Allianz commits to eliminating insurance coverage for coal plants
The financial services firm based in Germany, Allianz, has announced its commitment to stop offering insurance coverage to coal plants.
The company will no longer provide sole coal plant insurance, and will phase out coal risks from its portfolio by 2040.
The insurance has also confirmed that it will ban all companies with plans to install more than 550MW of new coal capacity from its portfolio.
“Allianz wants to cut the biggest climate killer out of the core business over time. We are getting even more serious on global warming,” stated Oliver Bäte, CEO of Allianz.
The news follows in the footsteps of other firms in the insurance field, with AXA, Zurich, and SCOR has pledge to no longer ensure some or all of new coal projects.
“The coal industry is the number one driver of climate change, and building new coal plants is incompatible with the goals of the Paris Agreement,” remarked Peter Bosshard, Coordinator of the Unfriend Coal campaign.
“We welcome Allianz’s move as an important step towards making the coal industry uninsurable and uninvestable.”
Allianz is anticipated to lose approximately €50mn (US$59.3mn) from premiums generated by coal plants and mines per annum.
However, the company noted that it earns more than twice as much from insuring renewable energy projects.
Drax advances biomass strategy with Pinnacle acquisition
The Group’s enlarged supply chain will have access to 4.9 million tonnes of operational capacity from 2022. Of this total, 2.9 million tonnes are available for Drax’s self-supply requirements in 2022, which will rise to 3.4 million tonnes in 2027.
The £424 million acquisition of the Canadian biomass pellet producer supports Drax' ambition to be carbon negative by 2030, using bioenergy with carbon capture and storage (BECCS) and will make a "significant contribution" in the UK cutting emissions by 78% by 2035 (click here).
This summer Drax will undertake maintenance on its CfD(2) biomass unit, including a high-pressure turbine upgrade to reduce maintenance costs and improve thermal efficiency, contributing to lower generation costs for Drax Power Station.
In March, Drax secured Capacity Market agreements for its hydro and pumped storage assets worth around £10 million for delivery October 2024-September 2025.
The limitations on BECCS are not technology but supply, with every gigatonne of CO2 stored per year requiring approximately 30-40 million hectares of BECCS feedstock, according to the Global CCS Institute. Nonetheless, BECCS should be seen as an essential complement to the required, wide-scale deployment of CCS to meet climate change targets, it concludes.