Unloading Coal Exposure: Where Are We and What Can Chinese Banks Do?

This research paper outlines a three-step framework ("plan/review, decide, implement") to help banks, particularly those in China, reduce and eliminate their coal exposure. It emphasizes that unabated coal use for power must drop from 36% in 2022 to 3% by 2035 to meet the 1.5°C goal. The paper argues that a holistic approach covering the entire coal value chain and all financial instruments is necessary, suggesting that international collaboration and increased transparency will provide Chinese banks with a competitive advantage in the energy transition.

• To maintain the 1.5 degrees Celsius (°C) goal, global coal combustion must decrease quickly. Specifically, unabated coal use for power generation needs to drop from 36% in 2022 to 13% by 2030 and further to 3% by 2035.
• The paper proposes a three-step framework to guide banks in reducing and clearing coal exposure, which can also be applied to other fossil fuels. This framework consists of: 1) Plan/review, using a checklist for information and resources; 2) Decide, using a prioritization table to assess priorities and update pledges; and 3) Implement, setting metrics to execute and monitor progress.
• While Chinese banks have already restricted coal financing, there is a need for greater transparency and clarity. The paper suggests that by strategically managing coal relationships and collaborating internationally, Chinese banks can gain a competitive edge and better adapt to the global energy transition.
• Banking institutions are critical to coal divestment because they provide funding through various instruments, including bond underwriting and loans, across different subsidiaries and markets. A comprehensive coal exit strategy should cover the entire coal value chain and all financial instruments, including indirect financing, which is an area requiring more clarification for Asian banks.

APA

World Resources Institute (n.d.). Unloading Coal Exposure: Where Are We and What Can Chinese Banks Do? https://www.wri.org/research/unloading-coal-exposure-where-are-we-and-what-can-chinese-banks-do

Chicago

World Resources Institute. Unloading Coal Exposure: Where Are We and What Can Chinese Banks Do? n.d. https://www.wri.org/research/unloading-coal-exposure-where-are-we-and-what-can-chinese-banks-do.

Wikipedia

{{cite report |author=World Resources Institute |title=Unloading Coal Exposure: Where Are We and What Can Chinese Banks Do? |url=https://www.wri.org/research/unloading-coal-exposure-where-are-we-and-what-can-chinese-banks-do |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{worldresourcesinstitutendunloading, author = {{World Resources Institute}}, title = {{Unloading Coal Exposure: Where Are We and What Can Chinese Banks Do?}}, institution = {World Resources Institute}, url = {https://www.wri.org/research/unloading-coal-exposure-where-are-we-and-what-can-chinese-banks-do}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }