July 30, 2020
Issue 322  |  View Past Issues

Editor's Note

The fallout from the FirstEnergy’s Ohio corruption scandal has grown to include the Governor supporting public demands for the repeal of the bailout legislation, a legal action being launched against the utility and American Electric Power being drawn into the controversy. In Malaysia, former Prime Minister Najib Razak has been found guilty of seven charges in his first corruption trial over receiving funds from SRC International, a former part of the 1MDB sovereign wealth fund. One of SRC International’s mysterious investments was in a Mongolian coal project. In the US, a company owned by the coal-baron Governor of West Virginia has been found to be liable for over 3000 breaches of selenium pollution standards between July 2018 and March 2020.

Elsewhere, upheaval continues in the coal sector. In the US, one of only two operational carbon capture and storage units on coal plants has been mothballed as it is currently uneconomic. In South Korea, a group of MPs from the ruling Democratic Party has proposed legislation banning investments in overseas coal power projects. In India, power demand has been hit hard by COVID-19, increasing financial pressure on coal power utilities. While power demand has increased in recent months, new COVID-19 cases are accelerating rapidly. In the Czech Republic, the publicly owned mining company OKD, which was badly affected by a COVID-19 outbreak, has flagged a plan to shut its mines by 2022 or possibly earlier. In Poland, the government-owned coal company PGG is canvassing options for the closure of some of its mines.

Bob Burton


Will Vietnam’s new energy policy mark a turning point for coal?

As other countries pull out of Vietnam’s coal sector, Chinese banks have become the lender of last resort for struggling projects, writes Michael Tatarski in China Dialogue.

Power utility bribery scandals in Ohio and Illinois

The bribery scandals in Ohio and Illinois are a vivid illustration of how US utilities routinely exert financial and political power to shield themselves from the risks of doing business, writes Dan Gearin in Inside Climate News.

Government’s lack of capacity, political will threatens Poland’s energy transition

The Polish Government’s defence of the powerful coal sector is crumbling but there is little evidence that it has much of a plan for moving beyond fossil fuels, writes Claudia Ciobanu in BalkanInsight.

Top News

South Korea's ruling party proposes bill to ban overseas coal finance: Twenty-one parliamentarians from South Korea’s ruling Democratic Party have proposed a bill banning investments in overseas coal power projects. The bill explicitly proposes banning KEPCO, the Korea Export-Import Bank, Korea Development Bank and Korea Trade Insurance Corporation from involvement in overseas coal plants. The legislators have also written to all four public agencies calling for a review of all coal projects currently being promoted and considered. Assemblyman Seong-Hwan Kim said that if the agencies did not voluntarily announce they were suspending support for overseas coal projects then the legislation should be passed. South Korea is one of the top investors in international coal plants behind China and Japan. (The Hankyoreh [Korean])

Former Malaysian PM convicted of corruption: The Malaysian High Court has found former Prime Minister Najib Razak guilty on all seven charges in his first corruption trial relating to the 42 million ringgit (US$9.8 million) being transferred from the accounts of SRC International into his personal bank accounts via intermediary companies. One of the projects of SRC International, a former unit of Malaysia’s 1MDB sovereign wealth fund, was a US$45.5 million investment in a Mongolian coal project even though no feasibility study had been undertaken on the proposed mine. Razak, who said he will appeal the decision, is still to face other charges relating to the 1MDB scandal in which billions of dollars were misappropriated and resulted in his government being defeated at the 2018 national election. (Time)

Fallout from Ohio corruption scandal extends to AEP: After the revelation of the US$60 million campaign bankrolled by FirstEnergy and the arrest of the Speaker of Ohio’s House of Representatives, Governor Mike DeWine has called for the repeal of legislation that benefited the utility. The legislation, referred to as HB4 and championed by the FirstEnergy-funded group Generation Now, provided up to US$1.5 billion in bailouts for the utility’s two nuclear plants and the W. H. Sammis coal plant in Ohio. FirstEnergy has confirmed that since last week’s arrests it has received several subpoenas. A FirstEnergy customer has also filed a lawsuit — which has the potential to become a class action case — seeking a refund of power price hike awarded as a result of the legislation. The bailout also benefits coal plants in Ohio and another in Indiana owned by Ohio Valley Electric Corporation, of which American Electric Power (AEP) is the largest shareholder. AEP has also confirmed that it funded a group called Empowering Ohio’s Economy which in turn donated $150,000 to Generation Now. (Reuters, Resource, Cleveland)

US coal company owned by Governor found to have breached Clean Water Act 3000 times: A Federal Court judge has ruled that Bluestone Coal Corporation, a company owned by West Virginia Governor Jim Justice, is liable for 3033 instances of breaching selenium pollution limits at its Red Fox Surface Mine in West Virginia. The legal case was brought by four environmental groups over breaches of the Clean Water Act that occurred between July 2018 and March 2020. The preliminary ruling allows the case to proceed to trial. The company has paid US$278,000 for selenium violations that occurred between 2018 and June 30, 2019 but the environmental groups have argued the maximum civil penalty for Bluestone’s violations could exceed US$160 million. (West Virginia Public Broadcasting)

Protests erupt as company seeks to expend German lignite mine: Protests have erupted after demolition work commenced on a road to facilitate RWE’s expansion of the Garzweiler lignite mine. The expansion of the mine, which the recently adopted coal exit law allows to operate to 2038, will involve the destruction of several villages if it proceeds. In 2019, a villager’s representative on the coal exit commission voted against the compromise agreed to by other parties as it would allow for the continued destruction of villages. One resident of the village of Kuckem, which is slated for demolition in 2027, is hoping that there will be a change of government at the next election, which will allow the villages to be spared. (The Local de)

Report finds over 76 major Indian coal ash accidents in last decade: An investigation into coal ash management in India has found that there have been at least 76 major coal ash accidents since 2010. The report by Healthy Energy Initiative India and Community Environmental Monitoring notes that incidents tend to be reported in India’s English language press only if accidents cause deaths, extensive damage to farmlands and pollution of water resources. The report notes that Indian coal power plants generated 217 million tonnes of coal ash in 2018–19. In 2000, the national government reclassified fly-ash from “hazardous industrial waste” to “waste material”. (Indian Express)

Traditional owner loses appeal against Chinese-backed mine in Australia: Federal Court judge Wendy Abraham has dismissed an appeal by Dolly Talbott, a member of the Gomeroi Traditional Custodians, against a decision by Federal Minister for Environment, Sussan Ley, not to protect Aboriginal heritage within the footprint of Shenhua’s proposed Watermark mine in New South Wales. Talbott argued the mine would destroy grinding groove sites, scarred trees and Gomeroi sacred sites. The reasons for the decision have not yet been published. Despite the setback, Talbott said she would submit new information to the minister in support of an application for the protection of the sites under the Aboriginal and Torres Strait Islander Heritage Protection Act. (Guardian)


Australia: Opposition calls for investigation into the allocation of A$4 million (US$2.9 million) grant for a coal plant feasibility study two days before an application was received.

Australia: BlueScope Steel fined A$30,000 (US$21,500) for breaching dioxin emission standards on six occasions.

India: Adani Power shareholders approve stock market delisting.

India: Former Chairman of Coal India appointed to Ministry of Environment panel reviewing projects that have begun operation without obtaining environmental clearance.

Ireland: Minister of Environment extends ban on sale, marketing and use of household coal after September 1 in all towns with over 10,000 residents.

Russia: Coal production declined by 9.4 per cent to 193 million tonnes in the first half of 2020 compared to the same period in 2019.

US: Environmental Protection Agency flags need to control pollution from the coal ash dump site at the former Bailly Generating Station to protect the Indiana Dunes National Park.

Companies + Markets

Only US carbon capture plant mothballed due to low oil prices: NRG Energy has mothballed the Petra Nova carbon capture and storage (CCS) unit at the Parish Generating Plant in Texas due to low oil prices. Carbon dioxide from the CCS unit has been sold for use in boosting oil production of the West Ranch Oil Field. Back in 2015 NRG Energy CEO, David Crane, told the Houston Chronicle that the Petra Nova project “made both strategic and economic sense at US$75 to $100 a barrel” but not when the oil price was US$45 per barrel. The oil price is now lower than US$45 per barrel. The mothballing of the plant means the only coal power plant in the world with an operating CCS unit is SaskPower’s Boundary Dam unit in Canada. SaskPower reports that during June the Boundary Dam unit operated only 43 per cent of the time due to a scheduled outage for inspections and maintenance. (E & E News [paywalled], SaskPower)

European Union Ambassador urges Vietnam to begin coal transition planning: Giorgio Aliberti, the European Union’s Ambassador to Vietnam, has told a Vietnamese energy summit that the government needs to begin planning a transition to clean energy and supporting economic diversification for coal-dependent communities. He also urged the government to strengthen the inspection and enforcement of standards for current coal power plants. Vietnam will increase the emphasis on solar and wind generation in its next power development plan but currently supports the construction of new coal plants which have already been approved. Vietnam has seven coal plants with a combined capacity of 7420 megawatts (MW) currently under construction. (Dau tu Online [Vietnamese])

Polish government changes tack on mine closures as coal crisis grows: A plan proposed by the state-owned mining company PGG to close the Ruda and Wujek mines by October 2020 has been shelved after opposition from mining unions. Between 2010 and 2019 the two mines, which employ 7700 workers, racked up losses of US$666 million. The initial plan also proposed the closure of a third mine owned by Tauron. The original plan was to cut Poland’s hard coal production from 61 million tonnes to 54 million tonnes by 2021 due to falling demand, low prices and large stockpiles held at mines and power plants. Unions objected to the job losses as well as the proposal to suspend miners’ monthly bonuses for four years and tie 30 per cent of their wage to achieving productivity targets. The Ministry of State Assets has now proposed a new process including union representatives to develop a restructuring plan for the hard coal sector. (Platts, Reuters)

Coal company proposed early closure of Czech Republic coal mines: The Board of Directors of OKD, the Czech Republic’s only producer of hard coal, has proposed the closure of its mines as early as 2021 or 2022. OKD, which is owned by the state-owned company Prisko, has been forced to suspend three of its five mines due to a major outbreak of COVID-19. The company’s mines employ about 8400 people of which an estimated 2000 are international workers, many from adjoining Poland. (New Europe)

Indian power demand gradually recovers but utilities’ finances further stressed: ICRA, the Indian subsidiary of ratings agency Moody’s, estimates Indian power demand will decline by between five and six per cent over the financial year to the end of March 2021. ICRA estimates the fall in demand will depress the plant load factor of India’s thermal plants, most of which are coal-fired, to 50–51 per cent. Typically, the plant load factor of India’s public sector plants is substantially higher than those of private power generators. ICRA argues the decline in power demand has hit the finances of distribution utilities and will increase pressure for a tariff increase of 2.5–3 per cent. Power demand has increased as economic restrictions have been eased but new COVID-19 cases have surged from around 8000 per day at the start of June to over 45,000 per day in late July. (Argus, ICRA [Pdf])

Glencore subsidiary seeks changes to Colombian coal mining licence: Colombia’s mining regulator, ANM, is considering a request by Glencore’s subsidiary Prodeco to suspend the operation of its two thermal coal mines for up to four years until global demand and prices improve. Prodeco suspended its mining operations on March 23 in response to COVID-19 restrictions. ANM is also considering changes to the company’s mining plan to reduce costs. One of the changes the company is seeking is approval from ANM for the use of land in Palomino area to dispose of mining overburden in a bid to reduce haulage costs. However, former Minister for Mines, Amylkar Acosta, said the land is currently designated as ancestral territory for indigenous communities. It is unclear whether the company has sought approval from the affected communities. (Argus)

Deutsche Bank tightens coal policy, but leaves big loopholes: In an update to its fossil fuels policy Deutsche Bank has committed to end support for thermal coal mining companies that generate more than 50 per cent of their revenue from coal by 2025 “at the latest”. However, this would not affect diversified mining companies such as BHP, Glencore or Anglo American. The policy is also silent on its support for metallurgical coal and coal infrastructure such as railways and ports. The bank also stated that by the end of 2020 it will review the diversification plans of European and US clients who have over 50 per cent exposure to coal power capacity or energy output. For those without “credible” diversification plans the bank said it will “gradually” phase out support for those companies. Deutsche Bank stated it will not begin to review companies in Asia and unspecified “selected developing markets” until 2022. (CityAM, Deutsche Bank, Urgewald)


Coal Ash in India – A compendium of Disasters, Environmental and Health Risks, Healthy Energy Initiative and Community Environmental Monitoring, July 2020. (Pdf)

This 31-page report provides a detailed overview of the management and mismanagement of coal ash from coal power plants in India.

“The future of coal in a carbon-constrained climate”, Nature Climate Change, July 2020. (Pdf)

This 3-page article argues phasing out coal requires a fair process involving stakeholders, a roadmap of coal plant retirements and policy options to respond to the economic costs of closures.

Solar for coal swaps, Energy Innovation, July 2020. (Pdf)

This 10-page briefing paper outlines how it is possible to retire existing and increasingly uncompetitive coal plants and swap the capacity for new solar generation with benefits for consumers and utilities.

Coal Mining Cleanup Works, Western Organisation of Resource Councils, July 2020. (Pdf)

This 27-page report estimates that coal mining rehabilitation could create up to 4800 full-time equivalent jobs per year immediately for up to three years after the closure of mines in in Colorado, Montana, North Dakota and Wyoming.