How, and why, coal and nuclear interests are converging in South Africa
A motley coalition has emerged in South Africa seeking to stop the growth of renewables while promoting the continued use of coal power and the construction of new nuclear plants, writes Sarah Evans in News24.
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Kosovo coal plant proposal collapses
ContourGlobal, a UK-headquartered private power producer, has announced that its proposed 500 MW Kosovo C lignite plant has been abandoned. While the company attributed the collapse of the proposal to opposition to the project by the new Prime Minister, the project has faced community opposition for over a decade. The company had also failed to attract financial backing after the World Bank and the European Bank for Reconstruction and Development backed away from their initial support for the project. The project had been mired in controversy over the costs of an offtake agreement negotiated with the former Kosovo Government and public concern over the pollution impacts and poor governance standards in approving the project. The Director of the Energy Community Secretariat had also warned that the project could bankrupt the country. Civil society groups have argued for investment in an energy efficiency program and renewables. In May 2019 ContourGlobal selected a consortium of General Electric subsidiaries to build the plant. ContourGlobal also owns the 908 MW Maritsa East 3 lignite plant in Bulgaria. (Bankwatch, Global Energy Monitor, ContourGlobal)
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Indian utilities feel coronavirus impact: Restrictions introduced to combat the spread of the coronavirus may cause a lack of spare parts from Chinese suppliers for coal plants and coal mines. PwC India estimates that about 30 per cent of the 62,000 MW of coal projects under construction in India rely on Chinese suppliers. Declining trade and financial impacts of the coronavirus outbreak may also suppress demand for coal generation, which declined by 1.5 per cent over the April 2019 to February 2020 period compared to the year before. Restrictions on trade with China have also affected the development of Indian solar projects. The Punjab State Power Corporation Limited has shut all five state-owned and private thermal power plants, which have a combined capacity of 6000 MW, as reduced power demand due to the effects of coronavirus and weak economic conditions means all demand can be met from hydro and solar generation. (Argus, Tribune India)
Sale of Australian coal port suspended due to coronavirus fallout: Brookfield, a Canadian asset management company, has suspended plans to sell the Dalrymple Bay Coal Terminal in Queensland due to market uncertainty following the coronavirus outbreak. In the 2019 financial year the terminal exported over 69 million tonnes of mostly metallurgical coal. The terminal, which has the capacity to load 85 million tonnes of coal a year, is estimated to be worth about A$2.5 billion (US$1.5 billion). However, after the Bank of America and HSBC collated the bids for the terminal in late February, Brookfield decided to suspend negotiations as travel restrictions curtailed its ability to market the project to prospective buyers. (Reuters, Australian Financial Review [paywall])
Indonesia coal plants affected by coronavirus: Indonesia’s Minister of Energy and Mineral Resources estimates that proposed and under-construction coal plants will be affected by restrictions on Chinese equipment imports and construction workers. Indonesia is currently not issuing visas for people from China, South Korea, Italy and Iran. Data provided to the Indonesia newspaper Kontan revealed that independent power producers have told the government that six plants with a combined capacity of 5500 MW will be delayed as they have invoked force majeure clauses in their contracts. Private power developers have also flagged that a further seven coal plants with a combined capacity of 4400 MW will be affected by the coronavirus but that force majeure clauses have not yet been invoked. (Kontan[Indonesian])
Indonesian coronavirus cases making Chinese traders nervous: Chinese coal traders have flagged the prospect that the increase in coronavirus cases in Indonesia may lead to Chinese port authorities quarantining coal ships from Kalimantan. In the first two months of 2020, China’s coal imports were up one-third on the year before due to the impact of coronavirus restrictions on domestic coal production. Some ports have reportedly already imposed quarantine checks on seaborne coal shipments of imported coal prompting traders to suggest coal prices may decline further if standards are further tightened. One analyst said data indicating that power consumption in January and February fell by 8.2 per cent leading to coastal Chinese utilities having large coal stockpiles was perhaps more important than the impact of coronavirus. One Indian trader said Indonesian coal ships are not allowed to enter Indian waters unless they have been in quarantine for 14 days after leaving their last port. (Platts)
South Korean party unveils campaign pledge to end international coal financing: The election campaign platform of South Korea’s ruling political party, the Liberal Party, includes a commitment to end coal project financing and support for a carbon tax as part of a Green New Deal. South Korea is the third largest financial supporter of international coal plants after China and Japan. South Korea’s national election is scheduled for mid-April 2020. (Greenpeace)
Australian Government faces legal challenge over water pipeline for Adani: The Australian Conservation Foundation has filed a legal challenge in the Federal Court against the Australian Government’s refusal to apply the ‘water trigger’ in the Environment Protection and Biodiversity Conservation Act to assess the impact of Adani’s proposed North Galilee Water Scheme. The ‘water trigger’ was introduced in 2013 to require assessment of impacts of all major coal mines and coal seam gas projects on water resources. The Australian Government stated the water trigger wasn’t applied as the water pipeline “is not a ‘large coal mining development’” and that the developer of the pipeline, Adani Infrastructure, is “a different legal entity” to Adani Mining. Adani plans to extract 12.5 billion litres of water per year from the Suttor River for coal washing and dust suppression. (Sydney Morning Herald, Australian Conservation Foundation)
US council hit by lawsuits over coal and coke terminal ban: Three companies affected by Richmond City Council’s phasing out of handling and storage of coal and coke have launched legal actions in the state and federal courts claiming the ban infringes their constitutional rights. Two of the companies are Levin-Richmond Terminal Corporation, which operates the coal terminal in the city, and Wolverine Fuels, which exports coal through the port. Wolverine Fuels operates three thermal coal mines in Utah which produce about 13 million tonnes of thermal coal for domestic power plants and the Pacific export market. The companies dispute the council’s concern that coal dust results in a disease burden in the local community. (The Mercury News)
Taiwanese council vows legal challenge over coal plant decision: Taiwan’s national government has overridden parts of legislation adopted in 2016 by Taichung City Government to restrict coal consumption at Taipower’s 5500 MW coal plant. The central government has been in dispute with the Taichung council after it imposed fines on Taipower for burning more coal than permitted. In December 2019 the council also revoked permits for the operation of two of the ten 550 MW units at the plant. In 2017 the council’s then Democratic Progressive Party Mayor set a 2019 coal consumption cap for the plant of 13 million tonnes. After the election in 2018 of a Chinese Nationalist Party Mayor a new limit of 11.08 million tonnes was set. Taipower and the central government have objected to the lower cap. Taichung City Government has flagged its intent to appeal against the central government’s decision to the Council of Grand Justices. (Taipei Times, Focus Taiwan)
Greenpeace sues Polish utility: Greenpeace Poland has filed a lawsuit against PGE GiEK, a subsidiary of the state-owned utility PGE, seeking an end to fossil fuel investments by the company. Greenpeace also wants the company to be required to plan for net zero greenhouse gas emissions from its existing coal plants by 2030. PGE is the largest utility in Poland with about 90 per cent of its generation coming from coal and lignite plants. PGE GiEK operates the 5420 MW Bełchatów plant, the world’s largest lignite-fuelled power station. Greenpeace Poland’s statement of claim is not yet publicly available with further information only to be published after the Regional Court in Lodz has made its decision. (Greenpeace Poland)
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Colombia: Workers vote to strike after Cerrejon pressed for the reduction of benefits due to low global coal prices.
Mozambique: Port concessionaire claims work on Macuse coal port to start in 2021 to export coal from the Moatize coalfields.
Serbia: State utility EPS signs agreement for Power China to build the new 350 MW lignite-fired Kolubara B unit by 2024.
Japan: A stockholder resolution has been filed with Mizuho Financial Group calling on it to end its lending to coal power plant developers.
Pakistan: Coal barge belonging to China Power runs aground in Balochistan after anchor chain broke.
Sweden: Pension fund AP1, which has US $37.4 billion under management, will divest from all fossil fuel companies.
US: Dominion pays $US1.4 million to settle state and federal suits over alleged state and federal permit violations at its coal plants.
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Carbon Tracker report flags collapsing economics of coal: A new report by Carbon Tracker Initiative estimates that renewables are already cheaper than the operating costs of a large proportion of the existing fleet of coal plants in major coal consuming markets such as China, India, US and Europe. Carbon Tracker estimates that renewables are cheaper than 71 per cent of China’s 982,000 MW of coal plants, just over half of India’s 222,000 MW and 96 per cent of Europe’s 149,000 MW of coal plants. The report estimates that 47 per cent of the US’s 247,000 MW coal fleet is more expensive to run than new renewables. The report also estimates that by 2030 renewables will be cheaper than just about all coal plants globally and that up to US$638 billion would be wasted if the 499,000 MW of proposed or under construction coal plants were built. (Guardian, Carbon Tracker Initiative)
US coal generation and mining to fall further by 2021: The US Energy Information Administration (EIA) projects in its short-term energy outlook that coal power generation will fall from 24 per cent in 2019 to 21 per cent in 2020 and 2021. The EIA estimates coal consumption by US power utilities will decline from 539 million US short tons (489 million tonnes) in 2019 to 453.1 million US short tons (391 million tonnes) to 2020, a decline of 16.9 per cent decline. The EIA estimates coal consumption may increase slightly in 2021 assuming higher gas prices but this estimate predates the latest economic shocks from the global spread of coronavirus. It also estimates US coal exports may reach 82.8 million short tons (75 million tonnes) in 2021, down from 92.4 million short tons (84 million tonnes) in 2019. (Platts, US Energy Information Administration)
Indian parliament passes law to open coal mining to global companies: India’s parliament has passed legislation opening up coal mining to private companies, including those who do not currently have end-use plants such as steel mills, and allowing international companies to invest in the sector. The Modi Government claims the change will boost domestic coal mining, help reduce demand for expensive imported coal and facilitate foreign investment in more efficient mining practices and technology. Coal India previously had a monopoly on domestic coal production other than where end users such as steel and aluminium producers had been allocated a captive mine. (Economic Times)
Indian minister urges states to end thermal coal imports: India’s Minister for Coal, Pralhad Joshi, has told parliament that he has written to the chief ministers of ten states requesting them to direct state-owned generation utilities to maximise domestic coal consumption “and stop coal imports.” Joshi has also requested the Minister for Power, RK Singh, to ask NTPC, a utility owned by the national government, to cease imports as well. A switch to domestic thermal coal would boost demand for Coal India’s production in the short term. Joshi attributed the continued reliance of state utilities on imports to “some import lobby … This is the major problem.” (Economic Times)
NGOs file complaint that Romanian Government is illegally subsidising coal mine: Bankwatch Romania and ClientEarth have lodged a complaint with the European Commission alleging that the Romanian Government has unlawfully used taxpayer funds to cover compensation costs for villagers displaced by a mine expansion by Complexul Energetic Oltenia (CEO). The groups argue that the €6 million (US$6.6 million) in compensation constitutes state aid which is not allowed under European Union market rules that aim to prevent governments from subsidising power generation. Bankwatch Romania and ClientEarth argue the funds should not be used to prop up CEO but should be directed to diversifying the region’s economy away from polluting projects. (ClientEarth)
German coal utilities acknowledge renewables shift but go slow on coal end dates: RWE – which has 13,500 MW of coal and lignite plants in Germany, Netherlands and the UK – has announced that it aims to invest €5 billion in renewables by 2022. “We should pay our dues to this old power production technology by bidding it farewell in style and with dignity,” said RWE’s CEO Rolf Martin Schmitz. However, RWE plans to delay the closure of its last 3000 MW of lignite units in 2038. Uniper, another European utility with a heavy presence in Germany, announced that its power generation would be carbon-neutral by 2035. However, this would largely be achieved not by voluntary closures but government-enforced coal closures. Europe Beyond Coal also noted that Uniper’s statement failed to mention its threat to sue the Dutch Government over the country’s plan to close all coal plants by 2030. (Greentech Media, rope Beyond Coal)
Chinese utility plans proposed hybrid wind, solar and hydrogen plant: Beijing Jingneng Power Company (BEIH) plans to invest US$3.3 billion in a 5000 MW hybrid wind and solar power generation combined with a plant to produce 400,000–500,000 tonnes a year of hydrogen as energy storage. BEIH is a financing subsidiary of the Beijing Energy Group, a state-owned enterprise which operates coal plants. The hybrid solar, wind and hydrogen project in Inner Mongolia is proposed to commence construction this year. Hydrogen analysts have proposed that a likely route to low-cost hydrogen is by using curtailed wind and solar capacity but the details of this project are not yet available. (Bloomberg)
Indian agency launches tender for 5000 MW of firmed renewables capacity: The Indian Government’s Solar Energy Corporation of India (SECI) has issued a tender for 5000 MW of grid-connected renewable energy projects. SECI proposes that the solar and wind capacity would then be bundled with coal capacity to provide firmed power under a 25-year power purchase agreement. The projects would have to provide at least 51 per cent of the power from renewable capacity and be able to provide 80 per cent of the capacity all year round. (Economic Times)
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