November 10, 2022
Issue 442  |  View Past Issues
CoalWire
Published by Global Energy Monitor

Editor's Note

As the global climate negotiations get underway in Egypt, a high-level UN group has highlighted the yawning gap between the net-zero emissions pledges by many companies and their continued support for climate-damaging projects such as coal mines and power plants. The report also highlighted the need to invest in a just transition for affected communities. South African President Cyril Ramaphosa has explained that funding the country’s just energy transition plan will require far more grants. The recently announced US$8.5 billion funding deal for South Africa’s transition away from coal included little by way of grants. For countries such as Vietnam, a critical element in building support for a shift away from coal is the ability of civil society leaders to work across sectors. But the Vietnamese Government has imprisoned clean energy and environmental advocates. A just transition also requires listening to the voices speaking up for change against powerful interests.

Two new studies illustrate how coal mining and power impacts are more significant than previously thought. In the US, a review of 292 coal plants has found nearly all are failing to prevent toxic heavy metals leaching from coal ash dams and polluting groundwater. A Canadian study documents how coal dust from open-cut coal mines in another province has badly polluted an isolated alpine lake almost 10 kilometres away. A final note on pollution of a different sort: Glencore has been fined about US$322 million over bribes paid to a range of African officials over a decade. While the scandal focused on oil leases and trading, the eye-popping revelation of bags of cash being flown around the world in private jets speaks volumes about the company’s culture.

Bob Burton

Features

As COP27 kicks off, where are the coal-to-clean deals at?

Where are the “just energy transition partnerships” with South Africa, Indonesia, Vietnam, India and Senegal up to? asks Joe Lo in Climate Home News.

South Africa runs on coal. Can it transition to clean energy?

A township’s battle over a new mine shows the challenge of a nation dependent on coal but also desperate to leave it behind, write Lynsey Chutel and John Eligon in the New York Times.

Teck and British Columbia lobbied against a Canadian Government investigation into coal mine pollution

The Ktunaxa Nation has been calling for a Canada–US body to investigate coal pollution for a decade. New records show the BC government and Teck Resources lobbied against it, write Ainslie Cruickshank and Francesca Fionda in Narwhal.

Bosnia’s biggest power project runs out of steam

After 16 years of questionable decisions on its financing, an illegal state guarantee, and objections to its environmental risks, the largest energy project in the history of Bosnia and Herzegovina has, in all likelihood, failed, writes Predrag Blagovcani in Transitions.

Top News

UN group says net-zero claims must be backed up with cuts to coal: A report by a group appointed by the United Nations Secretary-General, Antonio Guterres, says industry and other non-state bodies “cannot claim to be net zero while continuing to build or invest in new fossil fuel supply.” The report stressed that credible net-zero emissions plans require immediate cuts to emissions and that companies must end the development and exploration of new coal mines, the extension of existing mines and phase out coal plants by 2030 in OECD countries and 2040 in the rest of the world. The report said net-zero targets and transition plans of all financial institutions “must include an immediate end” of lending, underwriting and investments “in any company planning new coal infrastructure, power plants, and mines.” When receiving the report, Guterres said, “we must have zero tolerance for net-zero greenwashing.” (Guardian, Climate Home News, High-Level Expert Group on the Net Zero Emissions Commitments of Non-State Entities [Pdf])

Canadian study finds long-distance movement of coal dust: A paper published in Environmental Science and Technology has found dust blown from open-cut coal mines in British Columbia’s Elk Valley has contaminated Window Mountain Lake in southern Alberta with a dramatic increase in selenium and cancer-causing polycyclic aromatic compounds. The lake is about 10 kilometres away from the mine. The study found sediment samples revealed polycyclic aromatic compounds levels were now about 30 times higher than pre-industrial levels and have doubled every 10 to 15 years since open-cut mining began in 1970. Some compounds exceed levels specified in Canadian guidelines as necessary to protect aquatic life. The authors, two senior scientists in Alberta Environment and Protected Areas, said the data revealed the level of selenium in the lake sediments almost doubled between the pre-industrial era and the mid-1980s. Emily Bernhardt, an ecologist from Duke University in North Carolina, said the study revealed contaminants from open-cut mines were spread across “large regions” with the “amount of pollution in a region increases with the total extent of mining.” (CBC, Environmental Science and Technology)

Report finds nearly all US coal plants are polluting groundwater: An Earthjustice and the Environmental Integrity Project report says 265 of 292 coal plants it reviewed are in breach of the US federal Coal Ash Rule aimed at preventing toxic heavy metals from polluting groundwater. The report says 200 unlined coal ash ponds within five feet of groundwater or sitting in groundwater are being closed in their current state, with 70 per cent of these located in low-income communities of colour. The groups note that most of the 70 million tons (64 million tonnes) of ash currently created is being diverted to lined dams. The report also notes coal ash has been excavated from 81 unlined dams and is scheduled to be excavated at a further 91 plants. However, the owners of 123 plants deny responsibility and have not submitted a plan detailing possible clean-up options. The owners of 142 plants have flagged potential clean-up options, with commitments to a specific clean-up plan applying to only 38 plants. (Energy News Network, Earthjustice [Pdf])

Germany approves North Rhine-Westphalia plan for 2030 exit: The German Cabinet has approved a proposal by North Rhine-Westphalia to extend the life of RWE’s Neurath D and E lignite units until March 2024, with the possibility of a further one-year extension. The units were scheduled to retire by the end of this year. The state and RWE have committed to ending coal generation by 2030 compared to the 2038 end date specified in legislation passed by the previous government. The Neurath units rely on lignite from the nearby Garzweiler mine, with the mine operator preparing to demolish the village of Luzerath as part of its plan to expand the open-cut pit. (Reuters, Balkan Green Energy News)

Vietnam’s transition hampered by imprisonment of NGO leaders: Michael Sutton, director of the Goldman Environmental Foundation, has warned that the imprisonment of four environmental advocates this year makes it harder for Vietnam to achieve its goal of shifting away from coal. Nguy Thi Khanh, the founder of GreenID and a Goldman Prize winner, was imprisoned for three years. “Leaders like Khanh are instrumental in building public support” for a switch to clean energy, Sutton said. Dang Dinh Bach, another imprisoned NGO worker, informed residents of the potential health impacts of new coal power plants. Solar and wind generation has increased rapidly in Vietnam. However, there is strong opposition from within government agencies and elements of the energy industry to a significant reduction in coal generation. (CNA)

Queensland Government flags watering down community appeal rights: Environmental groups are alarmed by the draft terms of reference for a review of Queensland laws that increased public rights of legal review for mining projects. The draft document notes that legal challenges against projects by Adani, New Hope Corporation and coal baron Clive Palmer have delayed their coal projects and pose the question of whether the laws should be changed. In 2014 the Liberal National Party Government of Premier Campbell Newman moved to scrap merit review rights of mining projects. Before the changes came into effect, the Labor Government scrapped them after winning the 2015 state election. Lock the Gate expressed alarm that the government is proposing an option to reduce public participation, such as appealing to a government-appointed panel rather than accessing the Land Court. Lock the Gate wants the terms of reference amended to “to make specific reference to the fact that it is merit review rights that must be maintained.” (Brisbane Times, Lock the Gate)

Former Chinese judge arrested as part of an anti-corruption investigation: According to the state-owned news agency Xinhua, Hu Yifeng, a former top judge in Inner Mongolia, has been arrested on charges of “accepting bribes” in return for favourable court decisions. Wide-ranging investigations into corruption in Inner Mongolia’s coal industry have been underway since 2018. Since 2020, 789 investigations have been launched into corruption allegations in the coal industry involving over 1100 party members and government officials. The anti-corruption drive was launched by President Xi Jinping in 2012 and has coincided with the increasing marginalisation of his political rivals. At the recent National Congress of the Chinese Communist Party, President Xi was appointed to a third five-year term after a 2018 constitutional amendment removed the two-term limit. (South China Morning Post)

“Using bogus ‘net-zero’ pledges to cover up massive fossil fuel expansion is reprehensible. It is rank deception. This toxic cover-up could push our world over the climate cliff. The sham must end,”

said Antonio Guterres, the United Nations Secretary-General.

News

Australia: A series of separate faults took offline the three units at the 825 megawatt (MW) Callide coal plant.

Australia: Coca-Cola and Glencore have won a legal challenge against the Queensland Government in a dispute [paywall] over A$130 million in coal royalties from the Rolleston open-cut mine.

Afghanistan: Minister for Industry Nooruddin Azizi says negotiations over an agreement to export coal to Iran are well advanced.

Kazakhstan: Five workers were killed in a methane explosion at ArcelorMittal’s Lenin underground coal mine. An explosion at the mine in 2006 killed 41 workers.

South Africa: Report suggests a build-up of a cement-like deposit was the cause of the collapse of the flue-gas duct at Unit 1 of Eskom’s Kusile power station.

US: Court rules that a coal company owned by West Virginia Governor Jim Justice owes a Swiss company US$1.5 million for undelivered coal.

US: Unless extinguished, a fire in the underground Lilla Canyon mine in Utah could force the early closure of the project. The mine supplies coal to Rocky Mountain Power’s 1472 MW Hunter and the 996 MW Huntington plants.

US: Alabama Power Company’s 109-year-old Gadsden Steam Plant will close on January 1, 2023.

Zimbabwe: A trial shipment of 20,000 tonnes of coal has been sent to a cement industry customer in China.

Companies + Markets

South African President calls for more grants in transition funding: The South African Government has warned that the high share of loans in the US$8.5 billion energy investment package by a coalition of rich countries risks worsening the country’s existing debt problems. Only US$330 million, representing 4 per cent of the package, is in the form of grants. South African President Cyril Ramaphosa said implementing the country’s full 1.5 trillion rand (US$8.5 billion) just energy transition would require more grant funding and low-interest loans. Civil society groups said support to make the plan “truly just” for affected communities, especially women, will require far more grant funding. South Africa’s investment plan prioritises transforming the electricity sector, developing electric vehicle manufacturing and green hydrogen production. The Life After Coal campaign has called for a more significant role of affected communities in shaping the transition plan. (Financial Times, UK Government, Life After Coal Coalition)

Bloomberg Philanthropies launches transition support coalition: Bloomberg Philanthropies, the foundation of Michael Bloomberg, has announced a partnership to support the development of energy transition plans and coal phase-out measures across Africa, Asia, and Latin America. The coalition of 25 involved in the project includes Bangladesh, Botswana, Brazil, Cambodia, Colombia, Mexico, Mozambique, Pakistan, Philippines, Turkey and Vietnam. The foundation announced it would partner with Glasgow Financial Alliance for Net Zero to support access to private capital for clean energy projects and the development of “high-quality carbon credits for avoided emissions from early retirement of coal power plants” as an “alternative revenue stream to make coal phase-out more financially viable.” (New York Times, Bloomberg Philanthropies)

Glencore fined over African bribery scandal: A UK court has ordered a subsidiary of Glencore to pay £281 million (US$322 million) in penalties and costs after pleading guilty to five counts of bribery and two counts of failure to prevent bribery under the UK Bribery Act. The court was told Glencore staff flew cash around the world in private jets to bribe African officials involved in the oil industry. The UK court decision is part of a series of penalties in cases brought in the UK, US and Brazil, which Glencore estimates could cost about US$1.5 billion. In May, Glencore agreed to pay over US$1.1 billion to settle a case bought by the US Department of Justice over violations of the Foreign Corrupt Practices Act and “a multi-year scheme to manipulate fuel oil prices at two of the busiest commercial shipping ports in the US.” The department stated Glencore had bribed government officials over a decade in seven countries to secure oil contracts, used bribes “to avoid government audits,” and “bribed judges to make lawsuits disappear.” Investigations by Swiss and Dutch authorities into the lack of measures to prevent corruption are ongoing. None of the charges related to Glencore’s coal interests. Glencore is the world’s largest exporter of thermal coal. (Guardian, Glencore, US Department of Justice)

Report reveals Switzerland plays a major role in the global coal industry: A report by Public Eye, a Swiss NGO, estimates Switzerland plays a dominant role in global coal trading, with companies accounting for about 40 per cent of the international coal trade. The group estimates that 245 companies with coal interests are either headquartered or have a trading arm in Switzerland and produce about 535 million tonnes of coal a year. Glencore, which is headquartered in Switzerland, is the largest company. The report notes that before the imposition of sanctions, about 75 per cent of the 212 million tonnes of Russian coal exports was marketed from Switzerland. Data from the Dutch research agency Profundo indicates that since the 2015 Paris Agreement, Swiss banks have loaned almost US$3.15 billion to the Swiss companies involved in the coal industry. (Public Eye [Pdf])

Colombian parliament approves tax on thermal coal: Colombia’s Congress has approved a tax reform bill that imposes an export duty of 10 per cent when the sale price of thermal coal exceeds US$60 per tonne. The government estimates the changes could raise between US$361 million and US$481 million per year. Lobbying by the mining industry resulted in the Senate excluding metallurgical coal exports from the new tax provisions. The bill also rules out companies deducting the cost of royalties from income tax, a change opposed by the mining industry and likely to be subjected to a legal challenge. (Reuters, BNAmericas)

India announces another round of coal blocks for auction: The Ministry of Coal has announced it will auction off 71 new coal blocks and reoffer 62 areas not successfully auctioned in earlier rounds. Eight coal blocks that received no offers in early rounds will also be reoffered for sale. The Minister for Finance, Nirmala Sitharaman, said India “needs greater investment in coal production and gasification projects.” The projects are located in 11 states. The ministry said the boundaries of the coal blocks had been modified to exclude protected areas, wildlife sanctuaries, critical habitats and areas with over 40 per cent forest cover. Some recent coal allocations have been mired in controversy over their impact on indigenous peoples’ rights, forested regions and local villagers. (Business Standard, Ministry of Coal)

Resources

Coal plants are still getting financed, despite pledges otherwise, Volts, November 3, 2022. (Podcast)

This 49-minute podcast on financing new coal plants, especially in Asia, features the executive director of Global Energy Monitor, Ted Nace, and the executive director of Reclaim Finance, Paddy McCully.