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Japan Challenges Obama “No Coal” Policy

Japan Challenges Obama “No Coal” Policy

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July 23, 2014 (LPAC)–Japan said on Wednesday that it would step up support for coal-fired power plants in developing nations. This, according to the {Wall Street Journal}, challenges a U.S. policy that seeks to discourage such plants, supposedly “to fight global warming.”

The move represents a repudiation of the Obama administration’s strict stance on carbon emissions. Washington is talking to members of the Organization for Economic Cooperation and Development (OECD) about a rule that would ban national export-credit agencies from financing new overseas coal power plants. Washington is pushing a policy of “ending public financing for new coal-fired power plants overseas,” wihtout, of course, suggesting in the necessary energy-flux density to supercede them.

In the policy adopted Wednesday, Japan contended that developing nations would have to use coal whether others liked it or not. “Encouraging the adoption of the most efficient coal technology as possible is a realistic way to cut CO2,” said the policy statement.

Under Prime Minister Shinzo Abe’s growth strategy, Tokyo seeks each year to back overseas coal power-plant projects worth about $4 billion. Typically those projects have Japanese private investors and use at least some Japanese equipment.

On July 17, the government-owned Japan Bank for International Cooperation announced a $202 million credit line for Vietnam Electricity to purchase Japanese equipment for a coal-fired power plant. The credit line will be insured by state-backed Nippon Export and Investment Insurance.

Another is a $1.1 billion coal power project in Chile, partly owned by Mitsubishi Corp. The project is financed by a bank consortium led by the Japan Bank for International Cooperation, and the loans are insured by Nippon Export and Investment Insurance.

In Malaysia, meanwhile, Mitsui & Co. has a stake in a $3.3 billion coal power project.

Other than nuclear power, modern coal technology provides the lowest-cost electricity without significant environmental damage. With nations like Pakistan, Vietnam, Myanmar, Philippines, etc., all in power-generation crisis, where consumer demand just can not be met, coal is the only reasonably-priced, available option while nuclear plant production is ramped up on an emergency basis.

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