September 23, 2021
Issue 387  |  View Past Issues

Editor's Note

After a decade of advocacy by civil society groups, President Xi Jinping has announced China will end public financial support for overseas coal projects, a decision that is likely to dramatically whittle back the global pipeline of proposed projects. China has also announced it will increase funding for clean energy projects in developing countries.

On the domestic front China’s powerful National Development and Reform Commission has released a new plan that outlines measures to rein in proposed, existing and under-construction high-emissions projects. This comes at a time when there is significant uncertainty about the financial stability of China’s real estate sector, which could have knock on effects on the country’s huge steel industry.

Elsewhere, three court cases have turned up very different results for coal projects. In Indonesia, a court has ordered President Joko Widodo and several of his ministers to develop and implement measures to improve Jakarta’s air quality. One of the items on the list will be cutting pollution from coal plants in Jakarta’s surrounding provinces.

Then there are two countries still in deep denial: Poland and Australia. The European Court of Justice has announced a $US586,000 per day fine for Poland continuing operations at its Turow lignite mine while a legal challenge brought by the Czech Republic against its expansion is heard. Poland is now refusing to pay the fine, escalating the crisis further. In Australia, the Minister for Environment, Sussan Ley, has approved the expansion of a coal mine despite an earlier landmark court ruling she had a duty of care to protect young people from the climate crisis.

Bob Burton


The promise of carbon-neutral steel

A new manufacturing technique could drastically reduce the footprint of one of our dirtiest materials, writes Matthew Hutson in The New Yorker.

Teck’s possible metallurgical coal exit an ominous sign for coal companies

Teck Resources consideration of offloading its Canadian metallurgical coal mines could be a signal that the company sees its coal operations as an increasing hindrance to its ability to attract investors, writes Set Fester from the Institute for Energy Economics and Financial Analysis.

Shaky Chinese property sector casts shadow over steel industry but meltdown unlikely

A downturn in the China’s real estate sector, which accounts for about a fifth of global steel demand, could have significant spillover effects on the steel industry, writes David Fickling in Bloomberg.


China to end overseas coal projects

Speaking at the United Nations General Assembly, China’s President Xi Jinping announced, “China will step up support for other developing countries in developing green and low-carbon energy, and will not build new coal-fired power projects abroad.” No other details on the policy have been released yet, such as the timing and whether it extends to cover construction and equipment supply contracts or projects that are yet to begin construction. Global Energy Monitor estimates there are 44 coal plants earmarked for about US$50 billlion in Chinese state financing. The projects would have the potential to produce 200 million tonnes of carbon dioxide a year. The climate think tank E3G estimates 40,000 megawatts (MW) of coal projects across 20 countries in the pre-construction phase of development had received public Chinese finance. Xi restated China’s commitment to carbon dioxide emissions peaking before 2030 and achieving carbon neutrality before 2060. China has an estimated 163,000 MW of coal capacity at the pre-construction phase, about 55 per cent of the global total. (Guardian, Reuters, People’s Republic of China)

Top News

China flags tighter supervision of proposals for high-emissions projects: China’s powerful National Development and Reform Commission (NDRC), the government’s central planning agency, has released a new plan on energy consumption that includes requiring all provinces to review already permitted high-emissions projects, including those under construction. Projects that would require energy over a threshold of 50,000 tonnes of coal equivalent are also subject to NDRC review. The plan states tighter constraints will be adopted for new high-emissions and energy consumption projects in order to “adjust” the structure of country’s energy system to help achieve the goal of peak carbon emissions by 2030 and carbon neutrality by 2060. The plan states there will be new incentives for renewable energy use. (Yan Qin [Tweet], NDRC [Chinese])

Indonesian court rules government must cut air pollution: In a landmark court case, the Central Jakarta District Court has ruled President Joko Widodo and the ministers of home affairs, health and environment, along with the governors of Jakarta, Banten and West Java, have failed to protect citizens’ rights to clean air. The 32 residents who brought the case did not seek damages but requested orders that the ministers ensure improved air quality. The court ordered the President and ministers to tighten national ambient air quality standards sufficient to protect human health and the environment. The Minister of Health must oversee efforts of the governors to cut pollution in the surrounding regions that directly affect air quality in Jakarta. An August 2000 report by the Centre for Research on Energy and Clean Air noted there is 7600 MW of operating coal plant capacity within 100 kilometres of Jakarta and estimated they are responsible for about 2500 premature deaths a year. (Independent, Greenpeace Indonesia [Indonesian])

Poland fined €500,000 each day the Turow mine keeps operating: The European Court of Justice has ordered Poland to pay the European Commission €500,000 (US$586,000) for each day the Turow lignite mine continues to operate until the Czech Republic’s legal challenge against the extension of the permit for the mine has been finalised. In May the court ruled the expansion of the mine is likely to “have negative effects on the level of groundwater in Czech territory” and ordered the mine cease operation during the legal challenge. Despite the order, the mine continued operating, prompting the Czech Republic to seek a €5 million penalty per day. Poland applied to the court requesting the original injunction be overturned. Poland's Deputy Minister of Justice, Marcin Romanowski, said Poland won’t pay a cent of the fine. Europe Beyond Coal has called on Poland and state-owned power company PGE to comply with the court order and begin Bogatynia region’s transition away from coal. (Guardian, Euractiv, Europe Beyond Coal, European Court of Justice [Pdf])

Australian mine expansion approved despite court ruling: Australia’s Minister for the Environment, Sussan Ley, has approved Whitehaven Coal’s Vickery mine expansion in NSW. The company proposes to produce 168 million tonnes of coal from the expanded mine over 25 years and contribute an estimated 100 million tonnes of carbon dioxide to the atmosphere. In July this year the Federal Court of Australia declined to issue an injunction against Ley approving the expansion but stated the Minister had a duty of care to protect young people from the climate crisis. Ava Princi, one of the eight students who brought the case, said Ley had “turned her back on the federal court, the international scientific consensus on climate change, and the children and young people of Australia.” Ley’s decision may yet be the subject of further legal challenge. (Guardian)

UK inquiry told proposed Cumbria coal mine would not be legal: The public inquiry into West Cumbria Mining’s (WCM) proposed Whitehaven underground metallurgical coal mine in Cumbria has been told by Professor Paul Ekins of University College London that the project is not “legally compliant” under the UK’s and European Union’s current policy frameworks on carbon emissions. South Lakes Action on Climate Change argued WCM’s proposal is seeking approval on the basis it would be needed “if the UK and EU fail on climate change.” WCM’s claim it would offset emissions with carbon credits purchased from The Gold Standard Foundation was contradicted with the group writing to Friends of the Earth stating that a new coal mine “must be avoided”. (Guardian, ITV)

US utility to consider early retirement of Rockport coal plant: American Electric Power (AEP) has agreed to close the 1300 MW Unit 2 Rockport coal plant in Indiana by the end of 2028 and evaluate the early retirement of the 1300 MW Unit 1. As part of a settlement with a range of groups including the Sierra Club, AEP agreed to assess the potential savings to customers of closing Unit 1 in May 2024, May 2025 or May 2026. Unit 1 was first commissioned in 1984 and Unit 2 was commissioned in 1989. AEP had previously agreed to shutter Unit 1 by the end of 2028. (Indiana Environmental Reporter)

 “It is a home run of stupidity for banks to think that it is a good idea to lead what is effectively an inaugural US dollar bond for a coal company,”

said Ulf Erlandsson, executive chair of Anthropocene Fixed Income Institute, on major banks supporting the bond raising bid of SUEK, a Russian mining and energy company’s bond raising.


Australia: Former coal lobbyist turned PM’s adviser has been appointed as Ambassador to OECD.

Australia: BHP tells 80 workers at its Mt Arthur coal mine to accept interstate transfers or resign.

Russia: Prime Minister Mikhail Mishustin says the government will develop a plan for a “step-by-step reduction” in coal and other fossil fuels.

South Africa: Shareholder resolution seeks coal-to-oil producer Sasol report on annual membership fees paid to industry associations campaigning on climate policy.

South Africa: Center for Environmental Rights requests the Minister of Mineral Resources and Energy to drop the proposed 1500 MW in new coal plants from the 2019 national energy plan.

Companies + Markets

Report estimates carbon capture not competitive even if free: A report by researchers at University of Oxford have excluded carbon capture and storage (CCS) fitted to fossil fuel plants from a model of the world’s future energy system on the grounds the technology is unlikely to ever be competitive. The report noted the technology is currently a very small, low-growth sector and in the 50 years since its inception “has exhibited no promising cost improvements”. The researchers concluded that within a few decades electricity produced with CCS “will likely not be competitive even if CCS is free.” (University of Oxford [Pdf])

Report urges closure of surplus European fossil fuel capacity: A report by TransitionZero and the Centre for Research on Energy and Clean Air estimates Bulgaria, Czech Republic, Germany, Italy, Netherlands, Poland, Romania, Spain, and Turkey have close to 38,000 MW of excess coal capacity that can be retired. The retirement of these plants would avoid 200 million tonnes of carbon dioxide emissions a year and save €1.7 billion (US$1.9 billion) annually. The report estimates Spain, Italy and Germany have 10,000 MW, 3000 MW and 8000 MW of surplus coal capacity respectively. (Centre for Research on Energy and Clean Air)

Reserve Bank of Australia finds minimal GDP impact from coal phase-out: The Reserve Bank of Australia estimates that under its Net Zero and Below 2°C scenarios Australia’s coal exports would fall by 80 per cent by 2050, with declining demand from China, Japan and South Korea accounting for around two-thirds of the decline. China, Japan and South Korea have all adopted net-zero emissions targets by mid-century. While the report estimates demand for Australian coal is unlikely to decline until the 2030s, it argues there is a risk both thermal and metallurgical coal mines could become stranded assets “even if there is no investment into new mines.” The bank says the risk to metallurgical coal projects is “somewhat lower … until greener alternatives become more widespread”. The report estimated that while the decline of fossil fuel exports could be significant in some communities the overall impact on GDP “is expected to be relatively small and gradual.” (Reserve Bank of Australia)

South African bank ends support for coal plants: In a revision to its fossil fuels policy, FirstRand, Africa’s biggest bank by market value, has announced it will no longer finance new coal-fired power stations and will cease funding new coal mines from 2026. FirstRand is the second African bank to ban lending for new coal plants. The bank plans to reduce its cap on coal lending from the current 2 per cent to 1.5 per cent of advances from 2026 with a further reduction to one per cent of total advances from 2030. The bank stated its reduction in coal lending “assumes the end of coal as the core energy source of South Africa between 2042 and 2049.” (Bloomberg, FirstRand [Pdf])

Coal India treads cautiously on coal price increases: The Chairman of Coal India, Pramod Agrawal, has told the government-owned company’s annual general meeting it is planning on increasing coal prices “slowly”. The company is facing higher costs as unions push for a 15–20 per cent pay increase in the next five-year labour agreement. Coal India last raised prices in 2018. In 2020–21 Coal India produced 596 million tonnes of coal, about 83 per cent of India’s domestic coal production. It also commissioned nine new mining projects with a combined annual capacity of 28 million tonnes and has approved a further 36 mining projects with an additional capacity of over 220 million tonnes a year. (Reuters, Coal India [Pdf])

Renewables groups criticise latest draft of Vietnamese power plan: The Vietnam Sustainable Energy Alliance (VSEA) has called for the reassessment of the proposal in the latest draft of Vietnam’s power development plan to cut 8000 MW of new renewables capacity by 2030. The revised draft plan also proposes to add 3000 MW of coal capacity by 2030 with another 8000 MW by 2045. VSEA noted the feasibility of further coal projects was in doubt because of the increasing difficulty in obtaining financial support from banks. They also said the current high cost of imported thermal coal meant electricity from existing coal plants was 10–11 US cents per kilowatt hour (kWh) compared to offshore wind power under the feed-in tariff at 9.8 US cents per kWh. Vietnamese exporters, especially major global brands, are increasingly seeking to source renewable power but cuts to renewable capacity could result in exporters facing trade barriers. (VietnamPlus)


Upper Hunter Futures: Roadmap for economic diversification in the Upper HunterDepartment of Regional NSW December 2020. (Pdf)

This 180-page report, which was commissioned by the NSW State Government, concludes urgent action is needed to offset the social and economic impacts of the decline of coal production.

“Adani Group’s new coal projects: why and how investors need to act”, Market Forces, September 2021. (webinar)

This webinar, hosted by Responsible Investor and Market Forces, on Adani’s coal plans features Tim Buckley from the Institute for Energy Economics and Financial Analysis, Peter Loow from Alecta, Lucie Pinson from Reclaim Finance and Pablo Brait from Market Forces.

Empirically grounded technology forecasts and the energy transition, University of Oxford, September 14, 2021. (pdf)

This 23-page paper estimates that if the deployment of solar, wind, batteries and hydrogen electrolysers continues at current exponential rates for the next decade the world’s energy system will be close to achieving net-zero emissions within 25 years.

Coal in Steel: Problems and solutions, Coal Action Network, September 2021. (pdf) (The media release is here.)

This 37-page report addresses claims by UK companies promoting new coking coal mines and outlines the alternatives to coal-based steel production.