Since July 2026, Reclaim Finance has questioned more than sixty international banks on how their coal policies treat captive coal <\/span>\u2013<\/span> coal plants built to power a single industrial site (<\/span>aluminium<\/span>, nickel, steel) rather than the public grid.(1) The main finding from this update to the Coal Policy Tracker: most policies do exclude direct financing of a new captive coal plant, but that protection collapses as soon as financing covers the broader industrial project, or as soon as financing becomes indirect as general support to the client company planning captive coal. Reclaim Finance calls on banks to close these gaps at every level of their policies.<\/span><\/span>\u00a0<\/span><\/p>\n<\/div> Captive coal is a structural blind spot in the global coal phase-out. While a record number of banks have committed to exit coal, captive plants have remained largely untouched by these commitments \u2013 and are growing precisely because they fall outside the scope of most existing sectoral policies.\u00a0<\/span>\u00a0<\/span><\/p>\n In Indonesia, Earthwise Institute's database identifies at least 23.9 GW of operating captive coal capacity \u2013 more than 40% of the country's total coal-fired power capacity \u2013 and a further 19.2 GW in the pipeline, bringing the expected total to over 43 GW.(2) This capacity serves private industrial interests (nickel, aluminium) rather than public electricity access: on many islands where communities have no reliable grid connection, captive plants are built exclusively for industrial parks, leaving those communities behind. The climate and health consequences are severe and worsening.(3)<\/span>\u00a0<\/span><\/p>\n To pin down this blind spot, Reclaim Finance tested banks' coal policies against three levels:<\/span>\u00a0<\/span><\/p>\n On this question, most banks answer clearly with an exclusion. BNP Paribas, Cr\u00e9dit Agricole and Soci\u00e9t\u00e9 G\u00e9n\u00e9rale all confirm that their exclusion of new coal plants applies regardless of where the electricity ends up. HSBC is explicit in its policy stating that it '<\/span><\/span>will not finance the creation of new captive thermal coal facilities<\/span><\/span>',<\/span> defining captive plants as '<\/span><\/span>thermal coal-fired power plants dedicated to a specific project or industrial facility, such as an <\/span>aluminium<\/span> smelter, a steel mill or cement plant, and the majority of power generation is for the client's own use<\/span>'<\/span><\/span>,<\/span> and excluding them on the same terms as grid-connected <\/span>ones.(<\/span>4)\u00a0<\/span><\/span>\u00a0<\/span><\/p>\n<\/div> The strength of these policies erodes as soon as financing moves away from the plant itself.<\/span>\u00a0<\/span><\/p>\n One real transaction shows exactly how this gap plays out in practice. In 2021, BNP Paribas financed the expansion of the PT Halmahera Persada Lygend nickel smelter in Indonesia, despite a policy that restricts direct financing of projects expanding the coal sector, including captive plants. Reclaim Finance's <\/span>Behind the Smokescreen<\/a><\/span> briefing documents that BNP Paribas defended the deal by arguing its contribution financed only \u00ab\u00a0other components\u00a0\u00bb of the project, not the coal plant itself \u2013 an argument the briefing dismisses given that money is fungible and the coal plant is an integral part of the industrial project.\u00a0<\/span>\u00a0<\/span><\/p>\n<\/div> It is at the level of the client company that the gap is the widest \u2013 or hardest to assess.\u00a0<\/span>\u00a0<\/span><\/p>\n Another real transaction shows exactly how this gap plays out in practice. In September 2024, Cr\u00e9dit Agricole CIB led a US$155.6 million syndicated term loan to Titan AL-TEC & Resource, (6) a Singapore-based financing vehicle of China's Tianshan Aluminum Group, structured as general corporate financing but predicted mainly to fund Tianshan's Indonesian expansion \u2013 including a new alumina refinery paired with its own 160MW captive coal plant.(7) Reclaim Finance flagged the transaction to Cr\u00e9dit Agricole in October 2025, noting that the loan appeared to comply with the bank's own coal policy only because the plant's 160MW capacity falls under a 300MW threshold applied to coal developers. A general, non-earmarked loan reaching the group building the plant was compounded by a second loophole: a capacity threshold seemingly built for grid-scale coal plants, used here to clear a captive one.<\/span>\u00a0<\/span><\/p>\n<\/div> These findings confirm what Reclaim Finance has documented for years in its <\/span><\/span>Coal Policy Tracker<\/span><\/span><\/a><\/span>: the financial lever work<\/span>s<\/span> to constrain coal expansion but only where policies are explicit. Captive coal keeps growing precisely because it sits in the blind spots of existing policies. Reclaim Finance calls on banks to explicitly extend their coal exclusions across all three levels tested \u2014 dedicated <\/span>project<\/span>, general <\/span>project<\/span>, client <\/span>company<\/span>.<\/span><\/span>\u00a0<\/span><\/p>\n<\/div><\/div><\/div>\n
Dedicated project financing: the strongest line of <\/span>defence<\/span><\/span>\u00a0<\/span><\/h2><\/span>
![](\"https:\/\/reclaimfinance.org\/site\/wp-content\/uploads\/2026\/09\/Dedicated-project-financing_captive_coal_BP-2-1024x566.png\" "\\"Dedicated-project-financing_captive_coal_BP-2\\"")
<\/span><\/div>Once financing turns general, the protection weakens<\/span><\/span>\u00a0<\/span><\/h2><\/span>
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![](\"https:\/\/reclaimfinance.org\/site\/wp-content\/uploads\/2026\/09\/General-project-financing_captive_coal_BP-1-1024x561.png\" "\\"General-project-financing_captive_coal_BP-1\\"")
<\/span><\/div>At the company level, the blind spot widens further<\/h2><\/span>
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![](\"https:\/\/reclaimfinance.org\/site\/wp-content\/uploads\/2026\/09\/Client-company-level_captive_coal_BP-3-1024x561.png\" "\\"Client-company-level_captive_coal_BP-3\\"")
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![](\"https:\/\/reclaimfinance.org\/site\/wp-content\/uploads\/2026\/09\/Bank-by-bank-summary_captive_coal_BP-6-scaled.png\" "\\"Bank")
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