Coal industry will never recover after coronavirus pandemic, say experts
The global coal industry will “never recover” from the COVID-19 pandemic, industry observers predict, because renewable energy is now cheaper for consumers and a safer bet for investors, write Jonathan Watts and Jillian Ambrose in The Guardian.
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COVID-19 outbreaks at mines in Czech Republic and Philippines: Public health authorities have detected 82 cases of COVID-19 among the estimated 900 employees at the Darkov coal mine in the Czech Republic. The mine is operated by the government-owned coal mining company, OKD. In the Philippines, civil society groups have called for an investigation into why the Semirara coal mine continued to operate throughout an enhanced community quarantine (ECQ) period. The ECQ restrictions, which preclude mining, were declared after the detection of a COVID-19 positive mine worker which has subsequently led to eight others, including mine workers, being infected. (Reuters, Philippine Inquirer)
Norwegian pension fund dumps five coal companies: Norges Bank has excluded five coal companies from the Government Pension Fund Global. The five companies are the South African coal-to-oil producer Sasol, the German utility RWE, the world’s largest coal exporter Glencore, Australian coal mining and power utility AGL Energy and coal producer Anglo American. The companies were excluded because they produce over 20 million tonnes of thermal coal and/or have over 10,000 megawatts (MW) of coal plant capacity. A further four coal companies — major coal producer BHP, the US utility Vistra Energy Corporation, the Italian utility Enel and the European utility Uniper — have been placed on a watch list for review. (Guardian, Norges Bank Investment Management)
Youth legal challenge launched against proposed Australian coal mine: Youth Verdict, a group representing Indigenous and non-Indigenous young people, has launched a legal challenge against the proposal by billionaire Clive Palmer to build a new coal mine in the Galilee Basin in Queensland. Youth Verdict has joined with the Bimblebox Alliance to object to the Mining Lease and Environmental Authority for the Galilee Coal Project. Youth Verdict argues approval of the project will breach their human rights including the rights of the child, the right to life and the cultural rights of Aboriginal and Torres Strait Islander Peoples. Clive Palmer, who owns Waratah Coal, spent A$83 million (US$54) promoting his own political party at the May 2019 federal election. His campaign was widely attributed as a factor behind the re-election of the pro-coal government led by Scott Morrison. (ABC 7:30, Environmental Defenders Office)
Researchers finds Kingston coal ash radioactivity three times reported level: An analysis by Duke University researchers of coal ash from the Tennessee Valley Authority’s (TVA) Kingston power station has found that it contains three times more uranium than previously reported. Knox News commissioned analysis of four samples collected from the plant since the 2008 collapse of the Kingston coal ash dam. Hundreds of former clean-up workers are suing the TVA’s clean-up contractor, Jacobs Engineering, over health impacts from exposure to the coal ash. It has been estimated 48 workers have died from health impacts of working for the company at the site. (Tennessean)
Coal ash stockpiles grow at Indian coal plants: The Centre for Science and Environment has estimated that over the last decade that 627 million tonnes of coal ash has not been utilised as required but left in dams and landfill. In the last year there have been three Indian coal ash dam failures. Central Electricity Authority (CEA) data indicates that in 2018–19 just 78 per cent of coal ash was utilised despite a Ministry of Environment, Forest and Climate Change regulation requiring all coal power plants to achieve 100 per cent reutilisation of coal ash after 2017. CEA data indicates that 43 per cent of coal plants do not meet the target. (Down to Earth)
Eskom challenged over pollution data breaches: Eskom has been forced to initiate an internal forensic investigation after it was revealed that illegal breaches of particulate matter emission limits at the 4000 MW Kendal power station were misclassified and not reported to authorities. EE Business Intelligence revealed an internal Eskom chart misclassifiying high levels of pollution. A December 2019 compliance notice issued by the Department of Environment, Forestry and Fisheries also alleged Eskom had “knowingly and deliberately” used the wrong methodology when calculating its compliance with emissions standards. Eskom acknowledged that instead of dividing the total tonnage of emissions for each unit by the number of days it operated, its reports divided the volume by the number of days in a month, resulting in a lower figure. (EE Business Intelligence)
Indonesian Government passed mining law changes decried by NGOs: The Indonesian House of Representatives has passed amendments to the Coal and Mineral Mining Law to allow six major coal mining companies to operate for a further 20 years under special mining permits. The six companies, which produce about 70 per cent of Indonesia’s coal, currently operate under contracts of work that expire between 2020 and 2025. The amendments also shift approval of new coal projects from regional governments to the central government. While the amendments have been welcomed by the Indonesian Coal Mining Association, civil society groups said they had not been consulted about the changes and argue they do little to address the environmental problems with existing mines. (Jakarta Post)
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Australia: Engie fined A$1.5 million (US$980,000) over pollution from 45-day mine fire at Hazelwood power station.
Australia: Legislation passed to assist with carbon capture and storage for proposed brown coal to hydrogen project in the Latrobe Valley.
Australia: Friends of Latrobe Water lodge complaint with Environment Protection Authority seeking investigation of Hazelwood coal ash dams.
China: Suspension of Australian thermal coal imports reported to take effect from July 1.
Japan: Mitsui is considering selling its 45.5 stake of Paiton Energy which owns 2045 MW of coal capacity in Indonesia.
Myanmar: Shan state MP push to close Chinese-owned 120 MW Tigyit power plant rejected by government.
South Africa: Eskom documents indicate the utility plans to operate three old coal plants — Camden, Grootvlei and Hendrina — until as late as 2030.
Spain: Enel confirms [Italian] that it will close the Litoral coal plant by June 2021 but is investigating coal and biomass co-firing for the As Pontes plant.
US: Federal court rules EPA broke the law in rejecting a request from Maryland and Delaware to tighten pollution standards at 36 coal power plants to protect upwind states.
Zimbabwe: A coalition of civil society groups calls for the government to scrap plans for the proposed 2100 MW Chinese-backed Sengwa coal plant.
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French bank unveils coal exit plan: The fourth largest French bank, Natixis, has unveiled a new climate policy in which it pledges to “completely withdraw from the coal sector” by 2040. In 2015 Nataxis announced it would cease all project finance for the thermal coal industry and tightened the policy further in 2019 to exclude all general financing to companies with over 25 per cent of revenue from thermal coal. Nataxis’s new policy states it will not finance new thermal coal power or mining projects and will withdraw from the sector by 2030 in European Union and OECD countries and by 2040 for the rest of the world. Nataxis’s policy is significantly stronger on its coal provisions than those of either BNP Paribas or Societe Generale. (Reclaim Finance, Nataxis)
Polish Government considers industry consolidation as downturn bites: Poland’s Minister for State Assets, Jacek Sasin, has flagged the prospect that a plan to consolidate government-owned coal companies could be released in June. Sasin suggested that one option being considered is merging the thermal coal mining companies PGG and Bogdanka with the mining division of Tauron and the hard coal export company, Weglokoks. The consolidation would result in reduced production but would leave the metallurgical coal producer JSW as a stand-alone company. Polish coal producers have been hit with falling export prices, declining demand and low-cost Russian imports. (Reuters, Climate Home News, Deutsche Welle)
Mongolian Government offers to build coal plant for Rio Tinto’s mine: The Mongolian Government has offered to build a state-owned 300 MW coal power plant on the Tavan Tolgoi coalfield to supply power for the Oyu Tolgoi copper and gold mine. The mine, which is owned and operated by Rio Tinto subsidiary Turquoise Hill Resources, is currently powered via a connection to the grid in Inner Mongolia in China. Under the terms of its 2009 agreement, the company agreed to source power locally. Turquoise Hill Resources told the Mongolian Government in mid-February that a 300 MW plant would cost US$924 million including a 55-kilometre water pipeline and a 126-kilometre overhead power line to the mine. However, the company and government could not reach agreement on the proposal. The company has indicated tentative support for the government’s latest proposal, subject to details of cost, timing and financing. Negotiations are scheduled to be completed by mid-June. (Turquoise Hill Resources)
Commissioning of new Bangladesh coal unit increases overcapacity: The Institute for Energy Economics and Financial Analysis (IEEFA) estimates that the commissioning of the first 600 MW coal unit at the 1320 MW Payra coal plant will only make the country’s overcapacity problem worse. IEEFA estimates capacity use of existing plants was only 43 per cent during 2018–19. Due to capacity payments agreements, the Bangladesh Government paid 80 billion taka (US$936 million) to the Power Development Board in 2018–19 to cover its financial losses. (Dhaka Tribune, Institute for Energy Economics and Financial Analysis)
India moves to cut coal imports and boost sagging finances of utilities: The Indian Government has reportedly directed Coal India to displace 100 million tonnes of thermal coal imports in 2020–21. Coal India has been hit by a downturn in demand resulting in growing stockpiles. To support import replacement the government has announced a 500 billion rupee (US$6.6 billion) investment plan to improve coal transportation infrastructure. The government-owned Power Finance Corporation will also provide seven- to ten-year concessional loans to generators and power distribution companies (discoms) to ease the financial crunch on them from the impact of the COVID-19 lockdown. However, to access the loans the discoms first have to pay the 1.17 trillion rupees (US$15.5 billion) in outstanding debts to power generators. (Economic Times, Argus, Bloomberg Quint)
Indian Government offers rebates to attract private miners: In unveiling a stimulus package, the Indian Government re-announced plans to auction coal blocks in a bid to attract private investment in the coal sector which has long been dominated by the government-owned Coal India. It also announced it will offer a 50 per cent rebate on revenue payable to the government for projects that begin early production or exceed a scheduled target and a 20 per cent reduction for coal gasification projects. While the policy has been touted to attract international coal companies, the most likely beneficiaries are Indian companies such as Adani, Jindal Steel & Power and Vedanta. (Economic Times, Economic Times)
Eskom aims to break pollution control terms of World Bank loan: Eskom is seeking World Bank approval to amend a condition of its US$3.75 billion loan requiring it to install flue gas desulphurisation equipment on its 4800 MW Medupi power station by 2025. Eskom confirmed it has had “informal discussions with the World Bank” about changing the terms of the 2010 loan arguing it would be cheaper and less water intensive to modify other coal plants than to honour the original undertaking to slash sulphur dioxide emissions. In 2019 environmental groups launched a legal challenge against the South African Government’s failure to implement the Air Quality Management Plan arguing that the lack of pollution control on the utility’s coal plants violating people’s constitutional right to clean air. (IOL)
US company hypes plan for US$2 billion coal gasification plant in Indonesia: The US company Air Products & Chemicals has announced it will invest up to US$2 billion to build, own and operate a coal-to-methanol production facility at Bengalon in East Kalimantan. Air Products said the plant will be commissioned in 2024. The proposed facility would convert six million tonnes of coal a year from mines owned by the Bakrie Group’s PT Kaltim Prima Coal and Ithaca Resources PT Kaltim Nusantara Coal to produce 2 million tonnes of methanol a year. The plan is for Bakrie and Ithaca to market the methanol for domestic consumption with the Indonesian Government recently adopting legal changes to encourage gasification projects. At present Indonesia imports methanol for use in its biodiesel. (Air Products)
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