Members of the Organisation for Economic Co-operation and Development (OECD) have agreed to new arrangements regarding export credit support for coal fired power plants.
The new OECD arrangements will restrict support for inefficient power providers, while ensuring the energy needs of developing countries are not ignored.
Trade Minister Andrew Robb, and the Minister for Resources, Energy and Northern Australia Josh Frydenberg, welcomed the new arrangements.
“Australia’s objective in these negotiations was to ensure developing countries have access to High Efficiency, Low Emissions (HELE) technologies, while at the same time, ensuring their energy needs continue to be met,” Mr Robb said.
Mr Robb said the arrangements strike the right balance between reducing global emissions, and providing countries – particularly in our region – with access to adequate power supplies to support development.
“The new arrangements will encourage the use of higher efficiency coal plants while addressing the energy requirements of countries like India, Indonesia and the Philippines, as they continue to bring millions out of poverty,” Mr Robb said.
Mr Frydenberg said: “Australia has a proud record of supporting renewable and clean energy technology.
“This agreement supports the development of new technology while also recognising the important role that coal will continue to play in providing affordable electricity to the world.
“Australia’s export quality coal is low in sulphur and ash and is ideal for use in HELE power plants, which means our coal producers are well placed to meet future demand.”
The new terms will allow for continued export credit support for all sizes of ultra-super critical coal plants, the most efficient coal plant technology in commercial use at present.
Countries facing energy poverty challenges – and who are eligible for International Development Assistance (IDA) – will be able to access support for small to medium units with super-critical technology (up to units of 500 MW and to a total plant size of 1000 MW).
Official export credit support for sub-critical plants will be available for small plants in IDA-eligible countries.
The new arrangements will begin from January 1, 2017.