Captive: how the World Bank Group is financing the coal-powered destruction of Obi Island

The document examines the expansion of captive coal power on Obi Island, Indonesia, used to fuel nickel refineries for the electric vehicle battery supply chain. It highlights how the International Finance Corporation (IFC) is indirectly linked to these projects through financial intermediaries like Hana Bank Indonesia and OCBC NISP. The author argues that the IFC's 'Green Equity Approach' contains a loophole that explicitly excludes 'captive coal-fired power plants' from its definition of coal-related projects, allowing continued funding. The report details severe environmental and social impacts on Obi Island, including toxic waste from High-Pressure Acid Leaching (HPAL) refineries, respiratory illnesses, and increased structural poverty for women, while calling for the World Bank Group to close these policy gaps.

• The International Finance Corporation (IFC) maintains a policy loophole in its Green Equity Approach (GEA) that explicitly excludes captive coal-fired power plants used for industrial applications from its definition of 'coal-related projects'.
• The IFC is indirectly connected to captive coal on Obi Island through its investment in Hana Bank Indonesia, which acted as a mandated arranger for a $530 million loan to PT Halmahera Jaya Feronikel (HJF) to build a nickel smelter powered by six 150 MW captive coal units.
• The IFC is potentially exposed to captive coal via a $200 million debt investment in OCBC NISP’s Sustainability Bond programme; OCBC NISP subsequently invested in the PT Halmahera Persada Lygend nickel refinery project.
• Nickel processing on Obi Island, specifically using the High-Pressure Acid Leaching (HPAL) method, produces 4 million metric tons of toxic waste annually and is linked to increased rates of cancer, respiratory illnesses, and skin tumours in local populations.
• Captive coal development on Obi Island has disproportionately affected women, increasing their domestic workload due to invasive coal dust and exacerbating structural poverty.
• Greenhouse gas emissions from the Obi Island nickel industrial park reached nearly 3.5 million metric tonnes in 2022, a figure equivalent to six times the emissions of Timor Leste.
• Indonesia's captive coal capacity is projected to more than double from 14.2 to 32.7 gigawatts (GW) over the next decade if current expansion plans are realized.

APA

Trend Asia (n.d.). Captive: how the World Bank Group is financing the coal-powered destruction of Obi Island. https://trendasia.org/wp-content/uploads/2024/10/Recourse-Captive-coal-on-Obi-Island-2024-1.pdf

Chicago

Trend Asia. Captive: how the World Bank Group is financing the coal-powered destruction of Obi Island. n.d. https://trendasia.org/wp-content/uploads/2024/10/Recourse-Captive-coal-on-Obi-Island-2024-1.pdf.

Wikipedia

{{cite report |author=Trend Asia |title=Captive: how the World Bank Group is financing the coal-powered destruction of Obi Island |url=https://trendasia.org/wp-content/uploads/2024/10/Recourse-Captive-coal-on-Obi-Island-2024-1.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{trendasiandcaptive, author = {{Trend Asia}}, title = {{Captive: how the World Bank Group is financing the coal-powered destruction of Obi Island}}, institution = {Trend Asia}, url = {https://trendasia.org/wp-content/uploads/2024/10/Recourse-Captive-coal-on-Obi-Island-2024-1.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }