May 25, 2017
Issue 184  |  View Past Issues

Editor's Note

While the coal industry is never far from scandal and controversy, this week has been exceptional. In India a former Secretary of Coal and two other officials have been sentenced to two years’ jail for their role in a coal allocation scandal. In another case a former MP, Naveen Jindal, is facing more charges over another coal allocation scandal. In Bangladesh a former official has also been sentenced to jail for embezzling funds from a proposed coal plant. In the Dominican Republic protests continue over a massive bribery scandal with a part-built coal plant at the centre of the controversy. In Australia a former NSW Minister may lose his parliamentary pension and will soon be sentenced over his role in a Hunter Valley coal licence scandal. In South Africa an anti-corruption task force is investigating the coal supply deal between Eskom and Tegeta Resources. (Other recent scandals are documented on this website.)

The events of the past week illustrate how in too many countries the expansion of the coal industry is entwined with corruption scandals.

Bob Burton


Public opposition to South Korea’s coal pollution transcended political affiliations

The prominent support by major parties for a coal phase-out in the recent South Korean Presidential election campaign demonstrated how the impacts of pollution cut across political affiliations. Support for renewable energy is no longer seen as “liberal” or “conservative”, but simply a matter of public interest, writes Jang Daul from Greenpeace Korea in the Korea Times.

Shock waves from South Korea’s pollution crackdown to hit Indonesian exporters

The coal pollution crackdown planned by South Korea’s new President, Moon Jae-in, will have a big impact on Indonesia’s major coal producers, writes Yulanda Chung, a Southeast Asia energy finance consultant with the Institute for Energy Economics & Financial Analysis.

Lamu Coal: A much-needed energy boost or cancer causing project?

A proposed coal plant threatens the people and ecosystem of the Lamu World Heritage Site in Kenya, writes Daniel Wesangula in Standard Digital.

Top News

Indian court sentences former Coal Secretary to two years’ jail: An Indian court has found former Secretary of Coal, H C Gupta, and two other former Ministry of Coal officials guilty of breaching agency procedures in allocating the Thesgora-B Rudrapuri coal block in Madhya Pradesh to Kamal Sponge Steel and Power Ltd (KSSPL). The court also found KSSPL and its managing director had misrepresented the company’s financial position in seeking the coal block. The three former public officials were sentenced to two years’ jail but have been granted bail to appeal the decision.   (Economic Times, Economic Times)

Protests continue over Dominican Republic bribery scandal: Despite the confession of Brazilian construction company Odebrecht that it paid US$92 million in bribes in the Dominican Republic in recent years to win government contracts, no one has yet been charged with any offences. The government has negotiated a deal for the company to pay a US$184 million fine in return for protecting Odebrecht executives from prosecution, spurring public protests. The current government has refused to institute an independent inquiry into the US$2 billion contract for Odebrecht to build the 720 MW Punta Catalina plant, preferring instead to appoint a special commission. (Washington Post)

Eskom-Gupta’s deal subject of corruption investigation: The South African Government’s Anti-Corruption Task Team (ACTT) has told a parliamentary committee it is investigating Eskom’s coal deal with the Gupta family’s company Tegeta Resources. Despite the Chairman of Eskom defending the retirement and subsequent re-appointment of Brian Molefe as CEO of the utility before another committee, the parliamentary caucus of the African National Congress has called for his immediate removal. Molefe was Eskom CEO at the time of the deal with Tegeta Resources. (Business Day, Eyewitness News)

UNESCO urged to add Sundarbans to World Heritage in Danger list: UNESCO’s World Heritage Centre has recommended the Sundarbans be added to the List of World Heritage in Danger after the Bangladesh government refused to cancel the 1320 MW Rampal project and ignored eight of 10 recommendations from a recent report on threats to the area. The recommendation the area be added to the List of World Heritage in Danger, which will be voted on at the annual World Heritage Committee conference in Poland in July, has spurred a Bangladesh Government delegation to fly to Paris in an attempt to defeat the proposed change. (Prothom Alo, Energy Bangla)

Australian government cuts corners to court Adani: In a bid to extract a lucrative US$238 million “royalties holiday” from the Queensland Government, Adani has deferred a board decision on its proposed Carmichael coal project. The proposed waiver of royalties in the early years of mine operation has provoked opposition within the Queensland Government which vowed before the January 2015 state election that no subsidies would be provided for the project. The federal government has also quietly axed eight environmental conditions imposed on the project in 2015, including one to protect two species of vulnerable turtles. (Sydney Morning Herald, Sydney Morning Herald)

Indonesia’s deadly abandoned mines: East Kalimantan’s Office of Mining and Energy has estimated coal mining companies have left behind 632 un-rehabilitated mining pits, more than double the 314 pits the mining companies have disclosed to regulators. Twenty-seven deaths, mostly children and teenagers, have been recorded at 17 pits between 2011 and 2017, a human rights investigation found. Coal companies responsible for the pits include as shareholders or directors retired generals and a government minister. Regional governments, which have oversight of the mines, often fail to ensure abandoned pits are properly rehabilitated. (Tempo [paywall], Tempo)

Vancouver port biased towards coal, NGO tells court: Environmental groups have argued in Canada’s Federal Court that Vancouver Port Authority’s approval should be overturned as the agency was biased in favour of Fraser Surrey Dock’s proposed coal terminal. The Port Authority is legally required to impartially consider the project under the Canadian Environmental Assessment Act. The groups say Freedom of Information documents revealed the Port Authority passed information on the NGO’s activities to the coal lobby; and port executives would receive bonus compensation if the project proceeded. (Richmond News, Ecojustice)


Australia: Former NSW Minister Ian Macdonald may be stripped of parliamentary pension after misconduct conviction over coal licence.

Bangladesh: District head jailed for embezzlement of US$5.7 million allocated for Matarbari coal project; four others face charges.

India: Ex-MP Naveen Jindal charged with misleading the Ministry of Coal over Madhya Pradesh coal allocation.

Montenegro: NGO legal challenge seeks cancellation of approval for 254 MW Pljevlja II plant.

Papua New Guinea: NGOs alarmed as coal companies pursue country’s first coal licences.

South Korea: Following crisis meeting after election of new President, KEPCO vows to cut pollution.

US: Court rules coal ash from AES’s Puerto Rico plant can be landfilled despite local municipal bans.

Companies + Markets

Coal India markets local coal to importers: The Modi Government has approved a new coal supply policy which allows Coal India to auction coal surplus to independent power producers which have Power Purchase Agreements (PPA) reliant on imported coal. However, a condition for auctioning the coal is that the cost saving resulting from cheaper domestic coal is passed in full on to the power purchasers. Under the new policy the winning bidders at any coal auctions will be based on the size of the discount offered on their current PPA price. (Economic Times)

India cuts tax on coal, slugs solar: The Indian Government’s GST Council has decided to cut the tax on coal from 11.69 per cent to five per cent to take effect on July 1, 2017. The council also decided to impose an 18 per cent tax on solar modules compared to the current status of effectively being tax-free. Bridge to India, an Indian renewables consultancy, warns the changes to panel, inverter and services costs will increase total solar project costs by about 12 per cent and affect the viability of up to 10,000 MW of utility scale projects. The Minister for Power, Piyush Goyal, welcomed the reduced tax on coal, claiming it would lower costs while insisting the higher tax on solar panels would not increase the cost of solar projects. (Economic Times, Bridge to India)

Pakistan drops three coal projects as uneconomic: Pakistan and China have agreed to drop three uneconomic proposed coal power projects, with a combined capacity of 2940 MW, from the list of Chinese-backed projects included in the China-Pakistan Energy Cooperation Project. While Punjab Government officials are lobbying for the cancelled projects to be replaced by coal projects in their province, central government and Chinese officials are inclined towards hydro projects, pending the completion of feasibility studies. (The Nation)

Rebuff for Czech utility plans to privatise coal plant: The members of the supervisory board of the Czech Republic’s largest utility, CEZ, have rejected a proposal from senior management to sell the 1000 MW Pocerady plant to the privately-owned Czech Coal which supplies coal to the plant. The supervisory board’s opposition to the sale was in part due to CEZ’s commitment to phasing out coal plants by 2050 and doubt about the role of brown coal in Europe’s future power mix. Treasury, which owns 70 per cent of the utility, also objected. (Radio Praha, Reuters)

Trump’s budget aims to slash CCS funding: The Trump Administration’s draft budget for the Department of Energy proposes slashing spending on Carbon Capture and Storage research and development from over US$200 million a year to just US$31 million. A spokeswoman for the Secretary of Energy, Rick Perry, said the revised approach of the department would be to undertake basic research in emerging technologies - but leave development to private companies. (Bloomberg)


More coal equals more poverty: Transforming our world through renewable energy, Oxfam Australia, May 2017. (Pdf)

This 20-page report argues the direct and indirect impacts of coal power will drive more people into poverty while renewable energy is far better suited to addressing the energy poverty experienced by those living beyond the existing grid.

Dirty deeds, done for cheap dirt, Australian Conservation Foundation, May 2017. (Pdf)

This 32-page report investigates the possibility the Australian Government’s export credit agency, Efic, could be considering financial support for Adani’s proposed Carmichael coal mine.

A dark outlook, the health impacts of coal-fired power plants in Spain during 2014, International Institute for Law and the Environment, May 2017. (Pdf)

This 60-page report estimates coal plants in Spain in 2014 – the last year with complete data available – caused over 700 deaths with the total health costs estimated at between US$984 million and US$1.86 billion.

International finance for coal-fired power plants, IEA Clean Coal Centre, April 2017. (Pdf) (The report is available for free to registered residents of countries which sponsor the publisher.)

This 102-page report provides a wealth of detail including on how coal plants are financed, who the main global backers and major coal plant manufacturers are.  One limitation of the report is the reliance on financing data up to 2014.