July 5, 2018
Issue 236  |  View Past Issues

Editor's Note

Swiss Re’s initial steps in pulling back from reinsuring companies with major thermal coal or coal power interests is the latest indictor of the growing challenges the coal industry confronts. In the Philippines, grassroots pressure has led to a council withdrawing its support for a proposed 300 megawatt (MW) coal plant. In the Czech Republic, a mass protest entered a controversial lignite mine with over 200 arrested. New research is also pointing to the health impacts of air pollution, including from coal power plants, being far wider than previously thought. A new US study not only finds that there is a strong link between air pollution and diabetes but that existing fine particle pollution standards are set far too lax.

The coal sector continues to be dogged by controversies. In Malaysia, a former prime minister has been arrested over funds being funnelled to a company with interests in a coal project in Mongolia. In Australia, Adani’s Abbot Point Coal Terminal may face a legal challenge over its reliance on an Aboriginal cultural assessment for the port done by a group that was not the authorised indigenous body.

This week another senior Indian Government official has flagged huge growth in new renewables over the next decade. However, there is some uncertainty as to how much weight can be put on big announcements by the Indian Government in the lead up to the 2019 election. On the other hand, the results of the latest 2000 MW solar power auction are encouraging, with one of the winning bids equalling the record low price of 3.5 US cents a kilowatt hour. The Japanese Government, though, have baulked at substantially increasing the ambition of their renewable power target when finalising the next national energy plan. Instead, they have opted for an ever-so-slow renewables rollout and keeping coal roughly where it is.

Bob Burton


HSBC and Standard Chartered are making a killing on coal in Southeast Asia

HSBC and Standard Chartered willingness to keep funding polluting coal power projects in Vietnam and other Southeast Asian countries shows a flagrant disregard for public health, writes Nguy Thi Khanh, a 2018 winner of the Goldman Environmental Prize, in Asia Times.

India’s enormous solar power plan: Is it for real?

The recent suggestion that a 100,000 MW tender of wind and solar capacity would occur soon —reportedly retracted shortly afterwards — may be the latest example of the Indian Government making making ambitious promises about renewables and then back-pedaling, writes Ashish Fernandes in Unearthed.

Coal-reliant Kosovo gears up for wind shift to hit European Union target

Kosovo’s first wind farm is under construction as the government seeks funding for a proposed coal plant, writes Fatsos Bytyci in Reuters.


Philippines coal plant cancelled after council rescinds support

The City Council of Ozamiz in Misamis Occidental province has overturned its earlier resolution to support the construction of a 300 MW coal plant proposed by Ozamiz Power Generation. After revoking its resolution the council passed a second motion in support of investigating clean energy projects. The project was first proposed in early 2014 with most of the land for the project acquired by mid-2016. However, community opposition to pollution from the project grew, forcing the council to reverse its initial support for the project. (Mindanao Examiner, CoalSwarm)

Top News

Canadian coal company fined over water pollution: British Columbia’s Ministry of Environment has fined Teck Coal C$78,100 (US$59,400) for three breaches of its effluent discharge permit at its Line Creek Operations mine. Teck is the world’s second largest exporter of metallurgical coal. The Ministry reported the fines in the last quarter of 2017 were for “numerous discharges” from wash bays at the mine during 2013–2015, failure to inspect and maintain water treatment equipment and failure to “immediately report” the breaches. While Teck’s permit requires it to report permit breaches within 24 hours the ministry found one incident was not reported until 104 days later. (The Star, British Columbia Ministry of Environment)

Adani’s Australian coal port at risk over secret Aboriginal cultural assessments: Juru Enterprises, which the Federal Court of Australia ruled is the “nominated body” for the Juru indigenous people, has foreshadowed it will seek a court order against Adani over its Abbot Point Coal Terminal if the company fails to provide a copy of cultural heritage assessment it commissioned. On three occasions lawyers acting for the Juru have requested a copy of the assessment but so far Adani has failed to respond. The Federal Court of Australia recently determined the financially troubled Kyburra Munda Yalga Aboriginal Corporation, to which Adani had paid A$2 million ($US1.5 million) for the cultural assessment, was not the appropriate body to represent the Juru people. (Guardian)

Study links air pollution to diabetes: A study of 1.7 million US veterans estimates that outdoor air pollution significantly increases the risk of diabetes. The study estimated the risk of diabetes increased when PM2.5 air pollution levels exceeded 2.4 micrograms per cubic meter (µg/m³). The World Health Organization air quality guideline value is 10 µg/m³ while the US Environment Protection Agency threshold is 12.5 µg/m³. The study estimated that air pollution contributed to 3.2 million new diabetes cases globally in 2016, which is about 14 per cent of all new cases. The study identified Pakistan, India, Bangladesh and Indonesia as the countries with above average risk of diabetes due to air pollution. (Medical Express,  The Lancet Planetary Health)

Over 200 arrested over protest at Czech lignite mine: The Bilina lignite mine in the Czech Republic was shut down for 12 hours after 16 activists chained themselves to an excavator. Hundreds more people attending a five day climate action camp protested against the project with an estimated 234 arrested by police for entering the mine. In 2015 the Czech Government overturned a 1991 agreement not to expand the footprint of the mine and now plans to let it operate up to almost 500 meters from the town of Branany until at least 2035. (Prague Daily Monitor)

Japan makes little change to its draft energy plan: Japan’s Cabinet has endorsed a Basic Energy Plan similar to one adopted by the Abe Government in 2014 with renewables growing from its current 15 per cent to about 22 to 24 per cent by 2030. Earlier this year Japan’s Foreign Minister, Taro Kono, described the same goal in the draft plan as “significantly low.” The final plan aims for coal to provide of 26 per cent of the country’s electricity by 2030, similar to the target set in the last plan. In 2017 Japan imported an estimated 142 million tonnes of thermal coal. (Asahi Shimbun)

Former Malaysian Prime Minister arrested over company with coal ties: Former Prime Minister Najib Razak has been arrested and charged with embezzlement and bribery over the diversion of money from 1Malaysia Development Berhad (1MDB), the Malaysian Government’s infrastructure fund. In 2015 US$1 billion from the Malaysian public servants’ pension fund, KWAP, was loaned to SRC International which invested it in energy projects, including a Mongolian coal mine. Razak’s arrest followed an investigation into SRC International’s affairs. (Channel News Asia)

Goa coal port reopens amidst legal doubts: Despite public opposition the Goa State Pollution Control Board (GSPCB) has reinstated a “consent to operate” permit for Mormugao Port Trust (MPT) where subsidiaries of JSW and Adani operate coal berths. The permit allows each of the companies to import up to 4.8 million tonnes of coal a year with a maximum of 400,000 tonnes a month. On January 8 this year, following revelations the port had handled well in excess of its permitted volume, the GSPCB revoked the permit for coal operations at the port pending studies into pollution in the surrounding area. However, GSPCB refused approval for two new coal berths and rejected the use of three offshore mornings for coal transhipment. However, a local media outlet alleges that the three berths used by JSW and Adani have been illegally reclaimed by MPT from the Zuari River without the approval of the Goa Government. (Times of India, Herald, Herald)

China unveils revised air quality plan: China’s updated 2020 air quality action plan states the regions of Beijing, Tianjin, Hebei, Shandong and Henan will need to cut coal consumption by 10 per cent over the 2015-2020 period and the Yangtze delta region by 5 per cent while the Shanxi and Sha'anxi provinces won’t be allowed to increase consumption. Although these measures have been welcomed by environmentalists, concerns have been expressed about a provision requiring the closure of coal units smaller than 300 MW but allowing them to be replaced with new units meeting new emission standards. (Reuters, Lauri Myllyvirta)

“Coal is becoming the next tobacco … Who's going to want to invest in coal? Who's going to manage coal? Who's gonna join coal as a career?”

asked [paywall] former Rio Tinto CEO, Tom Albanese, at a mining industry conference in London.


Australia: NSW Audit Office report reveals government agencies have not acted on saline discharges from coal mines into Sydney water supply dams.

Australia: Queensland opposition to debate proposal to have publicly-owned Australian Rail Track Corporation build, own and operate a railway for Adani’s Galilee coal mine.

China: Bloomberg New Energy Finance tips batteries with wind and solar will be cheaper than old coal plants in China by 2028.

Mongolia: Parliament approves privatisation of 30 per cent of the government-owned company that owns the Tavan Tolgoi mine.

UK: Concern the Banks Group commenced work on its new Bradley mine before planning conditions had been met.

Companies + Markets

Swiss Re ends support for coal companies: Swiss Re’s long-awaited policy on coal excludes it from providing reinsurance to businesses which receive more than 30 per cent of their revenue from thermal coal or coal power. However, the policy does not exclude it providing reinsurance for diversified companies below the 30 per cent threshold or those planning new coal plants. Swiss Re, which was the world’s biggest reinsurer in 2016, joins AXA, Allianz and SCOR in announcing policies reducing their support for coal. (Swiss Re, Unfriend Coal)

Indian Government hypes huge renewables tenders: India’s Secretary of New and Renewable Energy, Anand Kumar, has claimed the government will auction 30,000 MW of solar and 10,000 MW of wind capacity each year until 2028. He said this would amount to 490,000 MW of wind and solar capacity by 2030 to meet the Central Electricity Authority’s estimated need for 862,000 MW of capacity based on the assumption of six per cent growth in electricity demand a year. A 2000 MW solar auction held by the Solar Energy Corporation of India has benefitted from plunging costs of panels exported from China with one winning 600 MW bid touching the lowest ever solar power price in India of 2.44 rupees per kilowatt hour (3.5 US cents per kwh). (Economic Times, Economic Times)

Australian Government forecaster sees thermal coal downturn: The Australian Government’s Office of Chief Economist (OCE) argues the expected 2018 seaborne thermal coal price of US$99 a tonne has been held up by “transitory factors” and is expected to fall to US$74 a tonne in 2020. OCE forecasts Chinese thermal coal demand will fall over the outlook period to 2020, Japanese demand will ease with possible nuclear power plant restarts and new South Korea’s new 0.4 per cent sulphur content cap will undermine demand for Australian exports. OCE estimates the seaborne thermal coal trade will decline by 22 million tonnes to 1036 million tonnes in 2020. It also estimates a 3 million tonne decrease to 1088 million tonnes in the seaborne metallurgical coal trade between 2018 and 2020. (Department of Industry, Innovation and Science)

Pakistan coal company pitches for big coal price hike: Sindh Engro Coal Mining Company (SECMC), is seeking approval from the Thar Coal Energy Board (TCEB) for a 21 per cent price increase in coal supplied to proposed new coal plants. SECMC, a joint venture between the Government of Sindh province and the privately owned Engro Corporation, was originally given approval to charge US$46.84 per tonne for a 6.5 million tonnes per annum mine. However, with two additional proposed 330 MW mine mouth projects, SECMC is seeking the price increase for a 1.4 million tonne per annum expansion of the mine. TCEB, which approved the initial price on the basis of guaranteeing a 20 per cent return on the capital cost of the mine, will discuss SECMC’s proposal on July 30. As of January 2018 Pakistan had 3190 MW of new coal plants under construction and a further 9195 MW proposed. (The News)

Breakdown of Asian thermal coal benchmark price: The collapse of negotiations between Glencore and Japanese utility Tohoku Electric Power over the annual contract price for thermal coal from the Australian port of Newcastle for April 2018 to March 2019 has created uncertainty for some other buyers. For decades the annual April-to-March benchmark price has been adopted by other buyers in Japan and Taiwan. Analysts believe the market is most likely to shift to using monthly or quarterly average price mechanisms. The practice of quarterly contracts for metallurgical coal ended last year. (Bloomberg)

Zimbabwe clears coal plant expansion: Construction of the Chinese-backed 600 MW expansion of Hwange Thermal Power Station has commenced with President Emmerson Mnangagwa attending the ground-breaking ceremony. Sinohydro Corporation of China, a Chinese government-owned company, has bought a 36 per cent stake in the expansion project which it is also building. China Export Import Bank is financing US$998 million of the US$1.5 billion project. The loss-making Hwange Colliery Company has been contracted to supply the expanded plant but is currently in disarray with the Zimbabwe Government announcing the appointment of six new members of the board. Five senior executives at the coal company were recently suspended for mismanagement of the company’s finances. (The Herald, Chronicle, AllAfrica, The Standard)


“Bangladesh has huge potentiality in wind power”, New Age, June 13, 2018.

This interview with three US wind energy researchers details how the wind energy resource can be far greater than previously thought due to changing wind technology and tower heights.