Publication Type
Working Paper
Version
publishedVersion
Publication Date
1-2025
Abstract
This study examines how national environmental performance, institutional investor divestment from fossil fuels, investment in renewable energy, and ownership type influence the global phase-out of coal power plants, and whether these effects are constrained by geographical boundaries. Using data on coal plant retirements across 90 countries, we test whether domestic and cross-border factors shape the timing and likelihood of asset closure. We find that companies headquartered in countries with stronger environmental performance are more likely to retire domestic but not foreign plants. While institutional investors divestment is often assumed to exert cross-border influence, our findings show that divestment pressure by domestic institutional investors only accelerates coal retirements within firms’ home-country operations and has limited impact on foreign operations. This challenges the assumption about global reach of investor-led divestment on climate governance and reveals a geographical limitation for private markets to promote global environmental sustainability. We find that companies headquartered in countries with stronger environmental performance and those investing in renewable energy are more likely to retire domestic coal assets. Publicly listed firms respond more actively towards retiring their foreign coal power assets than privately-owned firms. These results suggest that energy transition is shaped by institutional structures and market participants in addition to national policy, but all these factors have spatial limits. Hence, stronger international coordination among market participants and regulatory frameworks are needed to reach the global decarbonization goals.
Keywords
Coal phase out, Fossil fuels divestment, Energy transition, Transition risk, Environmental policies, Environmental Change
Discipline
Environmental Policy | Environmental Sciences
Research Areas
Integrative Research Areas
First Page
1
Last Page
44
Identifier
10.2139/ssrn.4920048
Publisher
Elsevier
Citation
KIM, Jiwon; COJOIANU, Theodor Florian; COJOIANU, Theodor F.; HARJOTO, Maretno Agus; and WOJCIK, Dariusz.
Mapping the end of coal: How policy strength, ownership, finance shape global plant retirements. (2025). 1-44.
Available at: https://ink.library.smu.edu.sg/cis_research/461
Creative Commons License
This work is licensed under a Creative Commons Attribution-NonCommercial-No Derivative Works 4.0 International License.
Additional URL
https://doi.org/10.2139/ssrn.4920048