The World Bank announced Aug 2 its latest venture designed to help clean up the noxious air pollution belched out by China's coal-fuelled homes and factories. The bank's private-sector arm, the International Finance Corporation (IFC), said it was investing up to $50 million in China's Xinao Group to aid the conversion of coal into an environmentally friendly fuel.

More than one million Chinese die every year from air pollution and more than 60% of these deaths are the result of indoor smog, the IFC said. Over one billion Chinese suffer from harmful emissions due to the burning of solid fuels in their homes

The cleaner fuel, called dimethyl ether (DME), can be used for household cooking and heating or can replace diesel as a fuel for transportation and power generation. The use of DME in cooking emits up to 40% less carbon dioxide (CO₂) than the direct burning of coal. DME production also helps to reduce global warming as it does not produce black carbon, which contributes two to three thousand times more in greenhouse gas emissions than CO₂ the IFC said.

The IFC said it would buy shares worth up to $10 million in a Xinao subsidiary and lend another $40 million for a petrochemical plant being built by the Chinese company in Inner Mongolia. The facility, which has also won lending of $140 million from commercial banks, will produce up to 600,000 tons per annum (tpa) of methanol from coal, which will then be used to produce about 400,000 tpa of DME.

The World Bank has been stepping up its involvement in projects designed to clean up China's acrid pollution, which has been detected in air particles as far away as the eastern U.S.
   
Sources: IndustryWeek staff, Agence France-Presse