November 23, 2017
Issue 209  |  View Past Issues

Editor's Note

As opposition to coal mounts — from the results of a massive global survey on clean energy and coal to the launch of the Powering Past Coal Alliance — the shift away from coal continues to gather speed.

Storebrand, Norway’s largest private pension fund, has dropped 10 coal companies from its investment portfolio. Lloyds, the financial services and insurance company, has signaled it will start dropping some coal companies from April 2018. In Hungary, a court has overturned a permit for a new coal unit.

A record low solar price in Mexico and a huge increase in solar capacity in China have further underlined the declining prospects for coal power. A new report estimates the speed of India’s energy transition may mean the country’s coal consumption will peak within a decade. In South Africa, a new report argues Eskom’s perilous financial position would be best served by shelving two partly built coal units, accelerating the retirement of three old plants and the building of more renewables.

Meanwhile, the South African Government is embroiled in even more controversy after the main advocate assisting a parliamentary inquiry into state capture alleged that he was offered a blank cheque by the Minister for State Security. There were scandals elsewhere too. In China, the CEO of a company trying to develop a major mine in Mongolia has been arrested over allegations of a fraudulent loan. In India, questions have been raised about the dropping of charges against Adani for the over-invoicing of imported coal and equipment.

As the prospects for renewables grow brighter, setbacks and scandals are constraining an ever-diminishing number of new coal projects.

Bob Burton


India’s thermal coal peak is within sight

On current trends India’s peak thermal coal demand may occur within a decade, writes Tim Buckley of the Institute for Energy Economics & Financial Analysis in RenewEconomy.

New global survey reveals that everyone loves green energy and hates coal

A global survey of 26,000 people across 13 countries reveals high levels of support for a coal phase-out and a transition to clean energy, writes David Roberts at Vox.

The huge health toll of mountaintop removal mining

“We found that as the levels of mining [coal in Appalachia] go up, the health impacts become increasingly more pronounced,” states Michael Hendryx, Professor of Environmental and Occupational Health at Indiana University, in an interview in Yale 360.


Hungarian court sets plant permit aside

The Administrative Court of Eger in Hungary has set aside the environmental license for a proposed 500 megawatt (MW) lignite unit at the existing Matra plant. The court said inadequate definition in the assessment study of the area to be affected by the proposed lignite plant meant the review needed to be redone. The German utility RWE, which is the majority owner of the existing plant, is attempting to sell its stake on the project. However, the court ruling raises doubt about whether the company or potential buyers will persist with the plan for the new unit. (Vilaggazdasag [in Hungarian], CoalSwarm)

Top News

Countries launch coal-free power coalition:  Twenty countries have launched a coalition to accelerate the global phase-out of existing coal plants and a moratorium on new coal plants without carbon capture and storage. The Powering Past Coal Alliance, promoted by the UK and Canada, aims to have 50 members by the next high-level UN climate change conference in Poland in December 2018. (Business Green, Powering Past Coal Alliance)

Indian minister vows to cover coal trucks and trains: In response to growing controversy over coal dust and air pollution, India’s Minister for Railways and Coal, Piyush Goyal, proclaimed that “we will design a covering over every truck and railway wagon that transports coal.” Previously Goyal had stated only that he had asked government officials to “explore the option” of covering rail wagons. However, he has not yet specified a timetable for implementing the change. (Economic Times)

Despite Indian pollution crisis, regulator pushes for delay: Despite the recent extreme air pollution crisis, the Central Electricity Authority (CEA) has proposed a five-year extension of the December 2017 deadline for coal plants to comply with new pollution standards. Private power producers, as well as publicly owned NTPC, are seeking taxpayer funding for plant upgrades or regulatory changes to pass the costs on to consumers. The Centre for Science and Environment argues that despite the power sector being given two years to comply with the new standards, most have not even begun planning for upgrades. (Reuters, Centre for Science and Environment)

Alleged bribe attempt referred to South African Parliament:  A key official assisting South Africa’s parliamentary inquiry into the “state capture” of Eskom has filed an affidavit with the National Assembly Speaker alleging he was offered a blank cheque by the State Security Minister, Bongani Bongo. The affidavit by Advocate Ntuthuzelo Vanara, who is leading the inquiry, has been referred to the South African Parliament’s joint ethics committee for investigation. Bongo declined to confirm or deny the allegation. (BusinessDay, Fin24)

CEO arrested over Mongolian coal loan: The Chairman and CEO of SouthGobi Resources, Mr Aminbuhe, was arrested in China on October 11 “as a suspect in a fraudulent loan case,” according to the company. SouthGobi Resources, which is listed on the Toronto and Hong Kong stock exchanges, owns and operates the Ovoot Tolgoi mine in Mongolia, which exports about 4 million tonnes of metallurgical coal each year to China. The company’s two largest shareholders are China Cinda Asset Management Corporation and China Investment Corporation, both Chinese state-owned companies. (South China Morning Post, Bloomberg)

Rotterdam Council votes to end coal port by 2030: Rotterdam City Council has voted to end the storage and transport of coal through the Port of Rotterdam by 2030 and voted to oppose the proposed 25-year renewal of the lease for the port. However, the decision on the lease renewal is the responsibility of the Port of Rotterdam Authority, which wants to keep the port open indefinitely. Rotterdam Port is the largest coal port in Western Europe, with 15 per cent of its 31 million tonnes a year destined for coal plants in the Netherlands and the remainder transhipped to Germany. (Dutch, Port of Rotterdam Authority)

“The coal industry simply has to go if we are to meet climate targets. There is no such thing as clean coal but there are clean and profitable alternatives like solar and wind,”

said Jan Erik Saugestad, the CEO Storebrand Asset Management, Noway’s largest private pension fund company.

CEO of US$80 billion Norwegian private pension fund says “the #coal industry simply has to go if we are to meet “climate targets” - & divests from 10 coal co’s


Colombia: New Aguadulce terminal increases access for exporters to the Pacific market.

Germany: Coalition talks collapse as free-market party walks out over coal and immigration issues.

India: Ministry of Environment officials approve expansion of Maharashtra mine despite importance of forested area for tigers.

New Zealand: Bathurst Resources fined NZ$10,500 (US$7150) for 14 unauthorised mine discharges into waterways.

Serbia: Work begins on Kostolac B plant despite inadequate pollution controls or assessment of mine impacts.

US: Plan to close loss-making 11-year-old Hardin plant in Montana in early 2018.

US: Imprisoned Kentucky MP and ex-coal company owner set to face wire fraud charges.

Companies + Markets

Storebrand ditches 10 coal investments: The largest Norwegian private pension fund, Storebrand, has sold shareholdings in 10 major coal companies including Eskom from South Africa, RWE and E.ON’s Uniper from Germany, and Kyushu Electric Power from Japan. Under the company’s revised investment criteria, Storebrand will no longer invest in companies with more than 1000 MW of new coal plants under construction or power companies with high levels of coal generation in their power supply mix. (Reuters, Storebrand)

Eskom urged to shut old plants, shelve Kusile expansion: An economic assessment by Meridian Economics of Eskom’s deteriorating financial position has recommended that the utility close three of its older coal plants early, suspend the completion of two units at the Kusile plant and expand renewable supply. Eskom has rejected the proposal to stop construction of the Kusile plant. Silas Zimu, an energy adviser to President Jacob Zuma, told an energy conference Eskom is “going down and under very, very fast”. (BusinessLive, Fin24)

Lloyds flags coal divestments in 2018: In April 2018 Lloyds, a major specialist insurance company, will implement a new coal company exclusion policy which it states will affect about 75 per cent of the assets in its central investment fund. The company has yet to finalise the full details of the divestment criteria. Unfriend Coal estimates that 15 insurance companies are divesting an estimated US$20 billion in coal stocks and bonds. Some companies are also refusing to underwrite coal projects. (Insurance Business, Unfriend Coal)

Questions over Adani meeting after import tax charges dropped: Four days after India’s Directorate of Revenue Intelligence’s (DRI) adjudicating authority, under K.V.S. Singh, dropped all charges against Adani group companies for alleged over-invoicing the costs of imported coal and equipment, Gautam Adani met the Modi Government’s Revenue Secretary, Hasmukh Adhia. Neither Adani nor Adhia responded to questions on whether the DRI charges were discussed. Adhia, who is now Finance Secretary, did not respond to questions on whether the Ministry of Finance will appeal Singh’s decision. (The Wire)

Solar powers up in China and Mexico: Bloomberg New Energy Finance estimates that China will install an 54,000 MW of solar this year, far higher than its original estimate of 30,000 MW. One analyst notes that China has raised its 2018 target from 40,000 MW to 55,000 MW. The International Energy Agency, which has a long history of underestimating the growth of renewables, last week estimated that Chinese solar installations in 2018 would fall to just 29,000 MW. A solar power reverse auction in Mexico has set a new world low price of 1.77 US cents per kilowatt hour, representing an 80 per cent fall in prices from solar auctions over four years. (Bloomberg, RenewEconomy)


India’s Electricity Sector Transformation: Momentum Is Building; Peak Coal in Sight, Institute for Energy Economics & Financial Analysis, November 2017. (Pdf)

This 59-page report details the profound transformation in India’s electricity system and why India’s coal consumption may peak within a decade at about 10 per cent greater than current use.

Destruction of the Highveld: Part 2 – Burning Coal, groundWork, November 2017. (Pdf)

This 213-page report documents the pollution impacts on the Mpumalanga Highveld caused in particular by Eskom’s cluster of 11 power stations and Sasol’s coal-to-oil plant.

Insuring Coal No More: An insurance scorecard on coal and climate change, Unfriend Coal, November 2017. (Pdf)

This 20-page report reveals that while 15 insurance companies have begun to pull back from investing in and insuring coal projects, most have yet to take any action

Eskom’s financial crisis and the viability of coal-fired power in South Africa: Implications for Kusile and the older coal-fired power stations, Meridian Economics, November 2019. (Pdf) (Press release here.)

This 56-page report argues that South Africa can cost-effectively meet future electricity demand with renewables while retiring old coal plants early and suspending the construction of the Kusile plant.

The long-term viability of coal for power generation in South Africa, CSIR, October 2017. (Pdf)

This 51-page technical report details the cost of operating part-built and aging South African coal plants to assist in assessing how to optimally cater for electricity demand while minimising Eskom’s costs.

“Carmichael coal mine magnate Gautam Adani: from school dropout to $12bn empire”, The Age, November 19, 2017. (An accompany photo essay is here.)

This feature article charts the rise of Gautam Adani, the Chairman and CEO of the Adani Group, and the impacts of the company’s mines, power stations and ports on communities in Australia and India.