Singapore banks can’t afford to miss out on coal phase-out despite immense challenges

THE hot topic in South-east Asian sustainable finance these days is the early retirement of viable coal power plants, known in industry shorthand as coal phase-out.

Supportive money and regulation have coalesced around coal phase-out at an incredibly rapid pace over the past year, highlighting the immense environmental and economic promise of coal phase-out. Singapore’s three local banks might seem primed to take advantage of this trend, given the country’s status as a regional financing hub and the banks’ prominence in the regional project financing space. However, the reality is that a Gordian knot of complex issues still stands in their way.

The financial and energy sectors now recognise that it is not possible to achieve key climate goals without phasing out existing coal-fired plants. The need is especially great in South-east Asia, where the majority of energy in the region’s largest economies is still produced from coal.