Editor's Note
When responding to the results of the 2018 Global Coal Plant Tracker report detailing the fall in proposed new coal plants, Associated Press tellingly noted that the World Coal Association “did not directly dispute the claim that coal’s growth in the power sector will peak by 2022”. The lobby group knows only too well its days of influence may be numbered. It is already struggling to persuade BHP, one of the world’s largest mining companies, to continue to be a member.
In Europe, diminishing financial support for Euracoal, the European coal industry’s peak lobby group, has forced it to focus on trying to slow the implementation of new pollution control measures which will further accelerate the closure of coal plants.
There have been plenty more developments in the last week to buoy up climate campaigners and dismay coal lobbyists. In South Korea the province with the biggest cluster of coal plants has announced its support for a coal power phase-out by 2050. In Bulgaria, a court has ruled against a permit for a coal plant expansion. In the UK, the government has blocked a new coal mine, in large part due to its climate impact. In the US, a federal court judge has ruled a government agency must assess the climate impacts of coal leasing program over an entire coal basin, not just individual projects.
The coal industry’s preferred consultancy, Wood MacKenzie, was also the unlikely bearer of encouraging news when it argued new solar power projects are increasingly beating coal plants on price alone. In Poland, the largest power utility is looking to invest in offshore wind rather than coal. As utilities shift their focus to renewables, the lobby groups for coal mining companies are becoming increasingly isolated.
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Europe’s coal lobby shifts focus to rearguard actions
Euracoal, the European coal industry’s peak lobbying group, may be declining in influence but is now focussed on slowing the seemingly inevitable demise of coal power in key European countries, writes Sara Steffanini in Politico.
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UK Government blocks Druridge Bay mine
The United Kingdom’s Secretary of State for Communities, Sajid Javid, has rejected a proposal by Banks Mining to mine three million tonnes of coal over a five-year period at Druridge Bay. In rejecting the proposal Javid noted the “very considerable negative impact caused by the adverse effect of greenhouse gas emissions and on climate change” which would be inconsistent with the government’s policies. The decision has been welcomed by environmental groups, with Friends of the Earth stating it was the first coal mine in the UK to be rejected due to climate change impacts. Coal Action Network also welcomed the decision and called on Javid to also block Banks Mining’s plan to begin construction of a new mine at Bradley. Banks Mining has six weeks in which it can appeal against the decision. (DeSmog UK, Guardian)
South Korea’s largest coal burning province backs 2050 phase-out
In response to growing controversy over air pollution, South Chungcheong province — which accounts for just under half of South Korea’s 36,000 megawatts (MW) of coal plant capacity — has pledged to promote the phasing out of coal power by 2050. In its recently released 2050 Energy Vision Plan the provincial government has proposed to expand renewable energy from 7.7 per cent to 47.5 per cent of electricity generation. The provincial strategy also proposes to reduce energy consumption, dramatically cut air pollution and commits to a just transition for the workforce and affected communities. While provincial governments only have the direct power to regulate air quality standards, South Chungcheong province has played a major role in pressing the central government to shift away from new coal plants. South Korea, which has little domestic thermal coal mining production, is estimated to have imported about 106 million tonnes in 2017, predominantly from Indonesia, Australia, South Africa and Russia. (Korea Joongang Daily, Google Translate version)
Bulgarian court rejects permit for power plant expansion
The Supreme Administrative Court of Bulgaria has upheld a decision by the Bulgarian Executive Environment Agency (EEA) to refuse a permit for a proposed expansion of the existing 250 MW Brikel power plant. In 2015 the EEA refused to grant a permit for the plant expansion but the company appealed the decision. In rejecting the company’s appeal the court noted the existing plant had failed to meet air pollution standards and lacked a waste disposal site. The court determined there was no guarantee that conditions in a new permit would be complied with either. The company’s appeal was opposed by the EEA and Za Zemiata Access to Justice, a legal arm of Friends of the Earth and Greenpeace Bulgaria. (ClientEarth)
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Mass rally against NSW coal mining: An estimated 5000 people marched through Sydney streets to protest against the social and environmental impacts of coal mining and coal seam gas extraction in New South Wales. NSW accounts for the vast bulk of Australia’s 200 million tonnes of thermal coal exports. The rapid expansion of coal mining has spurred growing public opposition over impacts on rural communities, water supplies, agriculture and pollution along transport corridors. The NSW Government, which has supported the expansion of coal mining and some new gas fields, is due to face an election in March 2019. (Guardian, SBS) Japan’s Environment Minister flags objections to new coal plant: Japan's Minister for Environment, Masaharu Nakagawa, has flagged his opposition to Kobe Steel’s proposed new 1300 MW coal plant at its steel mill in Kobe City. The Minister stated the proposed plant would emit about twice as much carbon dioxide as natural gas per unit of output and was inappropriate. Last October the provincial government suspended environmental assessment of the expansion after it was revealed the company had falsified quality data provided to its steel customers. The controversy over the plant comes as pro-coal Prime Minister Shinzo Abe and his wife are embroiled in a deepening controversy over a land sale scandal. (NHK World, CoalSwarm) Judge rules US agency needs to consider climate before coal leasing decisions: A US district court judge has ruled that the Bureau of Land Management (BLM) breached the National Environmental Policy Act when in 2015 it opened six million hectares in the Powder River Basin for coal, oil and gas leasing. The judge agreed with a coalition of environmental groups that the BLM was required to study the likely impact on the climate before its 2016 decision making the basin’s coal resources available for leasing. United States District Judge Brian Morris ruled that one of the options the BLM must consider that to reduce greenhouse gas impacts includes reducing coal production in the Powder River Basin. About 40 per cent of current US coal production comes from the Powder River Basin, which spans parts of Wyoming and Montana. (KTVQ.com, NRDC) Coal India fined US$1.3 billion for breaching licences: Mahanadi Coalfields, a subsidiary of Coal India, has been hit with a fine of US$1.28 billion (8.3 billion Indian rupees) by the Deputy Director of Mines for exceeding permitted production limits at 17 of its coal mines between 2000–01 and 2010–11. Coal India claims that, despite the Supreme Court ruling that fines be imposed on mining licence holders at the full value of the additional minerals mined in Odisha, the ruling does not apply to coal companies. (Economic Times) “I used to defend coal on the ground that it was a wider element than energy policy, that it facilitated our foreign policy … But renewables can also guarantee energy independence once you build them,”
said Monika Morawiecka, the director of strategy for PGE SA, Poland’s largest power utility.
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Australia: Anglo American concedes it may take five years to repair vital public road damaged by blast. Australia: Ahead of November Victorian state election, opinion poll reveals strong support for expansion of renewables rather than coal. Poland: Government moves to block civil society protests at international climate talks in December. Pakistan: Kapco scraps plan for 660 MW imported coal plant at Muzaffargarh. South Africa: In coal mining heartland, illegal coal mines boom in the guise of municipal clean up. US: Electricity demand fell by 1.7 per cent in 2017 and coal generation declined by 2.5 per cent compared to 2016. Zimbabwe: Government backs US$4.2 billion platinum project with 600 MW coal plant and mine. |
Coal industry consultancy declares solar the winner: Wood MacKenzie, which has long been the coal industry’s consultancy of choice, has reported solar power “continues to compete with — and beat — coal and natural gas.” Noting recent solar power tender results around the world, the consultancy noted that “recent bids are pushing average PPA [power purchase agreement] tariffs past the cost-competitive range with coal and gas” but cautioned that the projects have yet to be built. (Wood MacKenzie) Rio Tinto executive warned of “high-level corruption” in Mozambique: In May 2012 the head of Rio Tinto’s Mozambique coal business, Eric Finlayson, warned a colleague that there were serious infrastructure problems in the country and “high-level corruption” in government decisions. The memo was written about eight months before the company wrote down the value of its Mozambique coal tenements by over US$3 billion, due in large part to the company’s inability to win approval for coal barging down the Zambesi River. The document was tendered in court proceedings by the US Securities and Exchange Commission which has charged Rio Tinto and two former executives with fraud for failing to inform investors of the asset write-down in a timely manner. The company and the executives have applied to have the charges dismissed. (Sydney Morning Herald, Reuters) Debt restructure for new Australian coal export terminal: A coalition of lenders has agreed to an eight-year extension of a loan to the Wiggins Island Coal Export Terminal (WICET), a consortium of coal companies headed by Glencore. WICET was unable to refinance almost US$3 billion in debt by a September deadline and had initially proposed to restructure the loan on terms unacceptable to the banks and financial institutions. Under the revised plan, WICET is required to pay all free cash beyond operational expenses to cut debt to less than US$1.5 billion in the expectation it will be able to refinance the project as soon as possible. (Reuters) Botswana’s coal power exports confront tough market: With the commissioning of the new 600 MW Morupule B plant the Botswana Power Corporation (BPC) has begun power exports to the Southern African Power Pool (SAPP) via a new transmission line. When the last 150 MW unit of the plant is commissioned and the refurbishment of the 120 MW Morupule A unit completed, BPC is hoping to sell about 100 MW to SAPP. However, market conditions may be challenging as so far only South Africa and Namibia have been buyers. “While we would want bilateral supply contracts, the countries we know could pay us don’t need it and those that need the power have problems paying,” said BPC’s Chief Executive Officer, Stefan Schwarzfischer. (Southern Times of Africa) Poland’s largest coal generator shifts focus to wind: Monika Morawiecka, the director of strategy for PGE SA, Poland’s largest power utility, has signalled it plans to install up to 2500 MW of new offshore wind farms. The rapid decline in the cost of renewables combined with rising carbon dioxide emission prices is forcing a rethink in the company’s strategy. “The investment choice is simple for us: we’re heading toward the cheaper scenario,” she said. (Bloomberg) West Australia’s Muja plant debacle draws to a close: The West Australian Government’s publicly owned utility Synergy has confirmed A$20.3 million (US$15.6 million) will be allocated to rehabilitate the site of the Muja A & B plant. In 2009 the former WA government approved the refurbishment of four 30 MW units which were first commissioned in mid- to late-1960s. After the private investor backing the project withdrew, the WA government spent A$308 million (US$237 million) on the units. However, the units never ran reliably and were shut down in September 2017. (West Australian) |
Financing Investments in the Energy Sector, Heinrich Boell Southern Africa and Oxfam South Africa, March 2018. (Pdf)
This 66-page report explores the investment trends supporting coal projects in South Africa and the measures required to shift to a low carbon economy. |
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