China bank no longer considers fossil fuels ‘green’

Bloomberg

Fossil fuels are no longer considered “green” by China’s central bank.
The People’s Bank of China (PBOC) plans to remove “clean utilisation of fossil fuel” projects from the list of programs that can be funded by green bonds, according to a draft plan.
The bank has drawn the ire of environmentalists for allowing the sustainable financing tools to fund projects that burn coal but use enhanced technologies to reduce air pollution.
The draft plan could make it easier for foreign investors to tap into the world’s largest renewable energy market.
The new catalog of projects will meet the “international relevant standards,” according to the central bank. Only $31.2 billion worth of green bonds in the total $42.8 billion issued in China in 2018 met global criteria, according to a report by the Climate Bonds Initiative.
“The new catalog would make investing in China’s green bond market a lot easier for international investors,” said Wenhong Xie, China program manager at the initiative. “In the past, a sizable portion of green bonds from China were considered uninvestable due to a small fraction of coal assets in an otherwise green bond.”
The new draft plan also consolidates standards among the central bank, the National Development and Reform Commission and the China Securities Regulatory Commission, making a single standard for sustainable finance-worthy projects in China going forward.