GLObAL COAL RISK ASSESSmENT - World Resources Institute

Data Gap for Global Coal Trade
Further research is required to identify the major
companies/investors in infrastructure developments
for coal trade expansion.
The proposed capacity of new infrastructure development
is significantly bigger than projected demands.
Further study should analyze the possibilities and
consequences of over-construction.
Further research is needed to understand how growing
coal imports will affect domestic coal markets and coal
power developments in countries such as China and India.
Further research is required to analyze how the reductions
in nuclear power in Japan and Taiwan will affect
their coal imports. Both countries depend entirely on
coal imports for their huge coal power generations.
Further research is required to identify the source of
coal supply for the proposed new coal-fired plants in
countries with no domestic coal production capacities.
These include Cambodia, Dominican Republic, Guatemala,
Laos, Morocco, Namibia, Oman, Senegal, Sri
Lanka, and Uzbekistan.
Data Gap for Coal Finance
Global Coal Risk Assessment
Most of the literature reviewed for this paper was produced
by NGOs, including Coalswarm, the Environmental
Defense Fund, and the Sierra Club. It would be
useful to review industry materials, in order to better
understand how the industry views the risks of financing
coal development. An understanding of how risks
associated with coal finance are assessed by the industry
would be especially useful for climate advocates.
More in-depth research is required to unpack how
financing for coal projects works: the elements of a
financing package, how public and private banks interact,
and what role government plays. A solid understanding
of how deals are made is crucial to developing
an effective work strategy.
This paper briefly touches on different forms of subsidies
for coal projects. More country-based research
is needed to understand how coal is subsidized in a
particular country. Further research should also attempt
to quantify the size of subsidies. This work could
be linked to the ongoing global “phase out fossil fuel
subsidies” discussions.
There is little existing research that examines how
coal finance works in India and China—the two fastest
growing markets dominated by domestic players. It is
not clear to what extent coal-fired plant projects rely
on bank financing in these countries. Banks in China
and India do not appear vulnerable to the same reputational
risks as their international peers. A closer look
at the coal financing models in India and China could
perhaps shed light on how effective finance campaigning
can be organized in these two countries.
WORKING PAPER | November 2012 | 23