Improving Tracking of High-GHG Finance in the Power Sector

The report analyzes the tracking of 'high-emissions finance'—defined as primary investment in assets with a material contribution to global GHG emissions—focusing on the power sector in 2017 and 2018. Using project-level datasets, the authors tracked USD 40.8 billion in annual average commitments, representing roughly one-third of the total fossil fuel power investment estimated by the IEA. The analysis reveals that public institutions, particularly export credit agencies and state-owned banks, and private commercial banks are major sources of this finance. Significant data gaps exist because investments made through corporate balance sheets are not captured in project-level data, particularly in Europe and China. The report recommends that public authorities mandate the disclosure of capital expenditures for high-emissions assets and establish technical emission thresholds to deter harmful investments.

• The report tracked an annual average of USD 40.8 billion in new project finance commitments to fossil fuel power generation for 2017 and 2018, which is approximately one-third of the total investment in this sector worldwide for those years.
• Public financial institutions provided the majority of tracked commitments, totaling USD 21.7 billion per year. Export credit agencies were the largest single group, providing USD 9.2 billion annually, followed by commercial banks at USD 13.1 billion per year.
• Coal-fired generation was the primary recipient of tracked finance, receiving an annual average of USD 23 billion (57% of the total), while gas-fired generation received USD 15.0 billion (37%).
• East Asia and Pacific was the most significant region both as a destination for finance (USD 15.8 billion, or 39%) and as a source, providing over two-thirds of tracked commitments.
• There is a substantial data gap regarding investments made via corporate balance sheets, which are not captured in project-level datasets. This leads to an underestimation of the role of corporations and state-owned enterprises, particularly in Europe and China.
• Current sustainable finance taxonomies lack precise thresholds for 'dirty' or harmful investments, focusing instead on climate-positive criteria. The report argues that national regulators should mandate the disclosure of capital expenditures for high-emissions assets and set provisional emission thresholds to deter such investments.

APA

Macquarie, R., Naran, B., Rosane, P., & Wetherbee, C. (2020). Improving Tracking of High-GHG Finance in the Power Sector. Climate Policy Initiative. https://www.climatepolicyinitiative.org/wp-content/uploads/2020/12/1.-Improving-Tracking-of-High-GHG-Finance-in-the-Power-Sector-4.pdf

Chicago

Macquarie, Rob, Baysa Naran, Paul Rosane, and Cooper Wetherbee. Improving Tracking of High-GHG Finance in the Power Sector. Climate Policy Initiative, 2020. https://www.climatepolicyinitiative.org/wp-content/uploads/2020/12/1.-Improving-Tracking-of-High-GHG-Finance-in-the-Power-Sector-4.pdf.

Wikipedia

{{cite report |last1=Macquarie |first1=Rob |last2=Naran |first2=Baysa |last3=Rosane |first3=Paul |last4=Wetherbee |first4=Cooper |title=Improving Tracking of High-GHG Finance in the Power Sector |publisher=Climate Policy Initiative |date=December 2020 |url=https://www.climatepolicyinitiative.org/wp-content/uploads/2020/12/1.-Improving-Tracking-of-High-GHG-Finance-in-the-Power-Sector-4.pdf |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{macquarie2020improving, author = {Macquarie, Rob and Naran, Baysa and Rosane, Paul and Wetherbee, Cooper}, title = {{Improving Tracking of High-GHG Finance in the Power Sector}}, institution = {Climate Policy Initiative}, year = {2020}, month = dec, url = {https://www.climatepolicyinitiative.org/wp-content/uploads/2020/12/1.-Improving-Tracking-of-High-GHG-Finance-in-the-Power-Sector-4.pdf}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }