September 9, 2021
Issue 385  |  View Past Issues

Editor's Note

The near-record prices for both thermal and metallurgical coal in the export market may be putting smiles on the faces of executives of major coal exporting companies but high costs hurt importers. For utilities operating coal power plants reliant on imports, the volatile costs of thermal coal make the low and stable costs of renewables far more attractive. In the US, Duke Energy has submitted a revised power development plan for its Carolinas subsidiaries which includes the closure of over 9000 megawatts (MW) of coal capacity by 2030. The utility decided the rapid closure of the coal plants was the most economic option.

Helping utilities shut economic coal plants well ahead of schedule is an emerging area of policy discussion. Several major banks have proposed schemes that are as yet vague on details on financing accelerated coal closures. But as one analyst notes, proposals that are profitable for banks don’t necessarily have protecting the climate as the prime consideration. This debate comes as the cost of keeping coal plants online in a carbon-constrained world looks increasingly difficult. In China, a professional group representing engineers has estimated the cost of carbon capture and storage for coal plants would be prohibitively expensive.

In the UK, the opening of a public inquiry into a proposed new metallurgical coal mine has prompted the local Conservative MP to state that the recent IPCC report and damaging extreme weather events has led him to change his mind and oppose the project.

Bob Burton


Fossil fuel’s price boom isn’t the victory it might seem

The recent price spike in the cost of thermal coal provides a reminder to generators of why the days of thermal power are numbered, writes David Fickling in Bloomberg.

Five rules to make sure coal plant buyouts benefit the public, not the big banks

Paying coal plants to shut down would help the climate and save money — if it's done right, writes Justin Guay from the Sunrise Project in Canary Media.

Joe Manchin’s dirty empire

Senator Joe Manchin— who may determine the fate of key elements of President Biden’s climate policy — has earned millions of dollars from the coal companies he founded, writes Daniel Boguslaw in The Intercept.

Top News

Inquiry begins into proposed UK coal mine: Dr Neil Hudson, the Conservative MP for Penrith and the Border, has told an inquiry into West Cumbria Mining’s proposed Whitehaven metallurgical coal mine that he no longer supports the project. In his submission Hudson wrote that the latest IPCC report and recent floods and fires led to his change of heart: “I do not think we should be progressing with new coal exploration, even for coking coal.” The public hearing is expected to run for four weeks. The UK Government, which is hosting the COP26 climate negotiations in Glasgow in November, has been under growing domestic and international pressure to scrap the proposed mine. (Guardian, The Independent)

Study estimates Western Balkans coal plants caused 19,000 deaths: Research by CEE Bankwatch Network and the Centre for Research on Energy and Clean Air estimates pollution from 18 coal plants in the Western Balkans was responsible for 19,000 premature deaths between 2018 and 2020. The study, which examined emissions from coal plants in Serbia, Kosovo, Bosnia and Herzegovina, North Macedonia and Montenegro, estimates about half the deaths occurred in surrounding European Union (EU) countries due to the long-distance transport of sulphur dioxide emissions. The study estimates sulphur dioxide emissions from the 18 plants are 2.5 times greater than all 221 coal plants in the EU. The plants continue to operate in breach of the requirements of the pollution standards of the Large Combustion Plants Directive. (Bloomberg, Centre for Research on Energy and Clean Air)

European Union court decision undercuts German utilities’ challenges: A European Union Court of Justice ruling on a contract dispute between Ukrainian investor Komstroy and Moldova has been welcomed by ClientEarth and the Climate Action Network as evidence fossil fuel companies cannot invoke the provisions of the Energy Charter Treaty to take action against EU member states over climate protection laws. The court ruled the treaty provision that allows foreign investors to sue governments for legal changes was incompatible with EU laws that provide EU courts with the power to address disputes. Both RWE and Uniper have launched legal challenges against the Netherlands after the government legislated to close all coal plants by 2030. The utilities are seeking compensation payments. Uniper’s 1100 MW Maasvlakte coal plant and RWE’s 1600 MW Eemshvaen and its 652 MW coal plants are affected by the legislation. (ClientEarth)

Study finds four NSW mines routinely breached air standards: A report for Lock the Gate has found four major coal mines in New South Wales Hunter Valley have routinely breached air quality limits. The study revealed that since 2017 there were 440 instances when the 24-hour average concentrations for PM10 fine particle pollution exceeded the national air quality standard of 50 micrograms per cubic meter. The mines – Mach Energy’s Mount Pleasant mine, BHP’s Mount Arthur mine, New Hope Corporation’s Bengalla mine and Idemitsu Australia’s Muswellbrook mine – surround the town of Muswellbrook, which has a population of 16,000 people. The report found that despite the hundreds of exceedances, only 32 air quality incidents or non-compliances had been reported with the New South Wales Department of Planning. Only 10 infringement notices or cautions had issued against the pollution by the companies. (Cessnock Advertiser, Lock the Gate)

Adani report on endangered finch buried and ignored: A report by an independent scientific panel commissioned by the Queensland Government found Adani’s proposed plan for the black-throated finch was “superficial” and said there was “little empirical evidence” it would be effective. The report, which was completed ahead of the 2019 federal election, was initially rejected by the state government but was approved in late May after minor modifications. The Queensland Government did not publish the scientific panel’s report and rejected several applications for its disclosure under freedom of information laws. Birdlife Australia and University of Queensland researchers gained access to the report and found Adani was not required to address key recommendations or concerns. (Guardian, Birdlife Australia)

India’s zombie coal plants not needed it renewables target met: A report by Ember and Climate Risk Horizons estimates India’s slowing electricity demand growth has rendered plans for 27,000 MW of proposed coal plants redundant. The report estimates that even if electricity demand grows at five per cent a year, the International Energy Agency’s most optimistic assumption, coal generation in 2030 will be lower than in 2020 if current renewables targets are achieved. If peak demand in 2030 is 301,000 MW and occurs during sunlight hours, as studies suggest, proposed solar capacity can meet much of the additional demand. Further investment in battery storage would save US$6 billion per year and avoid about US$18 billion investment in proposed coal capacity. (Ember and Climate Risk Horizons)


Australia: Minister for Environment approves Wollongong Coal’s mine expansion despite company’s financial woes.

Australia: AGL Energy has been dropped from the Australian Stock Exchange Top 50 companies index after its shares plummeted in value due to the rise of renewables.

Colombia: Glencore subsidiary Prodeco has gained approval to surrender its licences for the La Jagua and Calenturitas coal mines.

Indonesia: Heavy rains flood South Kalimantan coal mines disrupting export shipments.

US: Operator error causes coal ash air pollution from City Water, Light, and Power’s 618 MW Dallman coal plant in Illinois.

US: Study finds 40 per cent fewer species in watersheds heavily impacted by mountaintop coal mines in West Virginia.

Companies + Markets

Duke Energy aims to close coal plants by 2030: In a revised integrated resource plan (IRP) submitted to South Carolina’s Public Service Commission (PSC), Duke Energy’s two utilities servicing the state – Duke Energy Progress and Duke Energy Carolinas – have proposed to prioritise the accelerated retirement of over 9000 MW of coal plants by 2030. Duke proposes the coal plants – the 1137 MW Allen, 546 MW Cliffside, 2200 MW Belews Creek, 2076 MW Marshall, 2558 MW Roxboro and 736 MW Mayo plants – will be replaced by a mix of solar, wind and gas capacity. Environmental groups have criticised Duke’s failure to place increased emphasis on energy efficiency measures and its plan to build up to 9600 MW of new gas plant capacity by 2035. Duke’s revised IRP is open for comment by parties to the proceedings for 60 days before the PSC will make a final decision. (Utility Dive, Sierra Club)

Seaborne coal price spike hits companies reliant on imports: The near-record high prices of both thermal and metallurgical coal in the seaborne market are hitting power utilities and steel plants reliant on cheap imports. In the last three months, the price of Indonesian and Australian thermal coal has increased by 30 per cent and 50 per cent respectively. Metallurgical coal prices in China have also increased by 50 per cent over the last three months with cargoes traded in Singapore reaching US$274 per tonne. The price rises have been driven by a range of factors including weather-related disruptions to mining. In China, regulators have instituted safety audits at mines leading to production restrictions, and major utilities are restocking ahead of the winter heating season. In India, some major utilities have boosted imports due to difficulties in accessing domestic coal. (Reuters, Reuters)

Chinese engineers group says CCS uneconomic: The President of the Chinese Society for Electrical Engineering (CSEE), Shu Yinbiao, has cast doubt on the viability of carbon capture and storage as a way of meeting the targets of peak greenhouse gas emissions by 2030 and carbon neutrality by 2060. CSEE estimates the current capture cost at a coal plant is 400 yuan (US$61.81) per tonne of carbon dioxide. This would impose a cost of US$54–$61 per megawatt hour (MWh) on utilities for coal generation. The current profit margin for Chinese coal generation is about 60 yuan (US$9.27) per MWh according to a recent study by Huadian Group, a major Chinese utility. (Platts)

German steel producer warns time is “running out” to cut emissions: Thyssenkrupp, a diversified German company, said its ability to sell its steel division is contingent on making rapid progress in cutting greenhouse gas emissions. Thyssenkrupp is focussing on increasing use of hydrogen and being carbon neutral by 2050 but an anonymous auto industry manufacturer said “we need green steel now”. Bernhard Osburg, the chairman of Thyssenkrupp Steel Europe AG, recently wrote in a letter to employees that “in no other area is time running out more than here.” (Clean Energy Wire)

Draft Just Transition plans at odds with European Union standards: A review by WWF Europe of plans submitted by seven EU member countries for funding under the €17.5 billion Just Transition Fund has found only two – Greece and Latvia – plan to end coal power generation by 2030. The review found Poland, Romania, Slovenia and Estonia imply a coal phase-out after 2030 while the Czech Republic’s plan does not commit to or imply a coal phase-out at all. WWF Europe and nine other organisations have urged the European Commission to ensure plans submitted by the 27 member countries are in line with EU climate goals and sustainability and social principles. (WWF Europe)

Global banks back Russian coal miners bid for bond raising: Siberian Coal Energy Company (SUEK), Russia’s largest thermal coal producer and the world’s fourth largest thermal coal exporter, has attracted the support of a coalition of major banks including the Bank of America, Citi and the Bank of China to issue a five-year US-dollar denominated bond. After Russia’s February 2014 occupation of Crimea, the US, the EU and other countries imposed a range of financial sanctions on major Russian banks, companies involved in the oil and gas industry and key individuals. SUEK was not on the list of target companies; the depreciation of the rouble against the US dollar led it to finance its debt-funded acquisition strategy by raising loans in roubles. In 2020 SUEK produced over 101 million tonnes of thermal coal with just over half exported and the bulk of the rest consumed by its 26 domestic coal power plants. (Global Capital [Paywall], Fitch Ratings)

Vale ramps up Mozambique mining operations in hope of sale: Vale has reported a loss of US$264 million on its coal division in the second quarter of 2021 in part due to recording impairments of US$432 million on its Mozambique coal operations. The Brazilian mining company is seeking to finalise its purchase of Mitsui’s 15 per cent stake in both the Moatize mine and its 50 per cent share in the 912 kilometre Nacala coal railway. Vale has negotiated to buy each of the stakes for US$1 each. At the start of 2021 Vale said it was aiming to increase production from Moatize to 22 million tonnes of metallurgical coal a year in the hope of attracting offers for the sale of its Mozambique coal division. Vale is now aiming to increase production to just 15 million tonnes a year with executives telling analysts only 55 per cent of current production is metallurgical coal. (Vale, Vale [Pdf])


“Old King Coal”, ABC-TV Foreign Correspondent, September 2, 2021.

This 28-minute video compares Spain’s just transition plan for its remaining coal mines and power plants with the free-market transition occurring in the US.

The Spotlight Effect: Using satellite imagery to estimate the utilisation rate of steel facilities, Transition Zero, September 3, 2021. (Pdf)

This 16-page paper details the initial results of a satellite-based methodology for estimating production and emissions from coal-based steel plants and how the results can help shift the steel sector to align with the goals of the Paris Agreement.

Economic diversification in Russia’s Kuzbass coal region, Climate Strategies, September 2021. (Pdf)

This 9-page policy brief outlines how the Russian Government plans to diversify the economy of the Kuzbass, its main coal producing region. It notes all current plans prominently feature fossil fuels while ignoring the potential of renewable energy.

“Europe’s coal legacy – in pictures”, Guardian, September 8, 2021.

Photographer Dan Wilton has documented Europe’s journey beyond coal for the environmental law group ClientEarth.