June 18, 2020
Issue 327  |  View Past Issues

Editor's Note

The notion that the transition away from coal power plants will occur over decades took a further battering this week with the Italian utility Enel announcing that it plans to accelerate its exit from the coal sector and the Spanish utility Viesgo announced it is seeking the early closure of its 570 megawatt (MW) Los Barrios coal plant. New coal plant proposals are also facing a tough time with Vietnam announcing that it wants 7000 MW more wind power commissioned by 2023 to make up for stalled coal plants. In the UK, the Welsh Government has announced it will not extend the permit for Celtic Energy’s Nant Helen coal mine due to the impact of coal burning on the global climate.

In Australia, Adani has encountered yet more setbacks with its proposed Carmichael coal mine with three more insurance companies exiting the project as Aspen Re reassesses its continued involvement. This comes as Australian insurance brokers complain how the shift in sentiment against coal is making it far harder for companies in the coal supply chain to gain coverage.

In South Africa, the United Nations Special Rapporteur on Human Rights and the Environment, David Boyd, has offered to give evidence in a legal case brought by NGOs against air pollution from coal plants operated by Eskom and the coal-to-oil producer Sasol. In Australia, BlackRock’s investment in China Shenhua has been thrown into focus over a coal project in Australia which threatens to destroy sites the indigenous Gomeroi people want protected.

Bob Burton


Australia cannot expect China to import and burn coal it no longer needs

Australian policymakers need to stop misleading coal-mining areas and their communities on the outlook for coal exports, writes Alex Turnbull in the Guardian.


Welsh mine blocked over climate concerns

The Welsh Minister for Environment, Lesley Griffiths, has rejected an application for the operation of Celtic Energy’s Nant Helen coal mine on the grounds that it “would have inevitable environmental and climate change impacts.” In a statement Griffiths, a Labour MP, said that the decision “ensures the coal remains in the ground and it will not contribute to global climate change, which is in the best interest of the people of Wales.” (BBC)

Top News

Three insurers drop Adani’s Carmichael Australian coal project: Three insurance companies – AXA XL, Liberty Mutual and HDI – have ruled out providing further insurance coverage to Adani Australia for its Carmichael coal and railway project. The decision followed the leaking of November 2019 invoices revealing the three had secretly insured parts of the early work on the project. The leaked invoices also revealed that in January 2020 the reinsurance company Aspen Re was involved in the project. Aspen Re declined to comment on its support for the Adani project and stated only that it is reviewing its policy on insuring fossil fuel projects. (Guardian, Sydney Morning Herald, Market Forces)

Enel flags coal exit by 2025: Antonio Cammisecra, the head of power generation for the Italian-headquartered power utility Enel, said the company is aiming to exit from all its remaining coal plants, which have a combined capacity of about 11,000 MW, by 2025. Enel recently announced plans to exit from its Chilean coal plants by 2025 which would leave it with one more South American plant in Colombia. Enel has also recently been given approval to close two of its five Spanish plants and the Brindsi plant in Italy. Cammisecra said the decline in demand from COVID-19 restrictions was just one more factor on top of carbon prices and falling renewables costs pushing coal out of the global generation mix. “The quicker we do it [exit coal], the better for everybody,” he said. (Platts)

UN expert seeks to testify in South African coal plant pollution case: The United Nations Special Rapporteur on Human Rights and the Environment, David Boyd, is seeking to give evidence in a High Court case brought by NGOs against air pollution from coal plants operated by Eskom and the coal-to-oil producer Sasol. In his affidavit Boyd noted that air pollution is the “deadliest environmental problem in the world today” and that member states have an obligation under international human rights law to “protect the enjoyment of human rights from environmental harm.” (Reuters)

Aboriginal community condemns Shenhua mining plan: BlackRock, the world’s largest asset manager, is facing pressure over plans by China Shenhua Energy to develop the Watermark coal mine which is opposed by the traditional owners, the Gomeroi people. BlackRock holds an A$474 million (US$326 million) stake in China Shenhua including a A$1 million (US$690,000) stake through its Australian arm. The Gomeroi have filed an appeal against a 2019 Australian Government decision to allow the mine to proceed despite an independent assessment that “immeasurable cultural values and connection to Country for the … Gomeroi people as a whole” were at risk. Initially BlackRock did not respond to requests for a comment but, following media coverage of the issue, stated that it was “deeply concerned” and would engage with the company over issues “including the protection of Indigenous heritage sites across miners’ operations.” (ABC News, Sydney Morning Herald, Sydney Morning Herald)

Study tallies social costs of Chinese-backed Sri Lankan plant: A study by the Sri Lanka Energy Managers Association, a group dedicated to promoting energy management, estimates the social and environmental cost of the Chinese-backed 900 MW Norochcholai coal plant at 36.6 billion Sri Lankan rupees (US$ 244 million) per annum. The report also noted that fisherpeople and farmers near the plant have experienced reduced production and higher costs while residents have experienced health impacts from sustained coal ash pollution despite attempts at mitigation measures by the Ceylon Electricity Board. (Daily Mirror)

German Government advisors urge faster coal exit: An expert commission tasked with overseeing Germany’s energy transformation has criticised the government’s plan to legislate to keep coal plants open until 2038. The four members of the commission argue that the current proposal does not recognise that the adoption of a European Green New Deal will require a “significantly quicker” transition away from fossil fuels. They also argue that carbon prices should be used to drive the transition rather than pay compensation to coal plant owners as many existing coal plants will exit the market earlier than the government’s legislation proposes. The commission’s report states that the combination of low gas prices and the European carbon price provide an opportunity to accelerate coal and lignite plants closures. (Clean Energy Wire)


Australia: Residents alarmed by large orange cloud of nitrogen oxides pollution from Stanmore Coal’s Isaac Plains mine in Queensland.

Australia: The Queensland Government has given Glencore’s proposed 20 million tonnes a year Valeria mine special status to be assessed by the state’s Coordinator General.

Australia: Community groups call for full environmental assessment on Engie’s plan to let the abandoned Hazelwood mine fill with water.

Australia: NSW Police seize documents from auditing company which investigated the scandal over tampered results of coal export tests.

Canada: Canada Pension Plan Investment Board holds C$141 million (US$104 million) in stock in Chinese coal companies.

India: Congress leader calls for coal washing requirement to be reinstated to cut pollution.

Taiwan: Taipower seeks to issue $11.7 billion New Taiwan dollars (US$393 million) worth of bonds, in part to finance the expansion of the 2400 MW Linkou coal plant.

Pakistan: Residents raise alarm at plan for water transfer for Thar coal projects.

US: Ozone Transport Commission votes 9-2 to urge Environment Protection Agency to require Pennsylvania power plants to operate pollution control equipment every day during peak pollution season.

US: The Platte River Power Authority, a Colorado utility, will retire the 280 MW Rawhide 1 coal unit by 2030, 16 years earlier than planned.

Companies + Markets

Spanish utility seeks early retirement of plant as solar capacity soars: Just months after the Spanish utility Viesgo indicated its 570 MW Los Barrios coal plant would continue operating until after 2022, the utility has requested permission to close it. The target date for closure is unknown and subject to regulatory approval. However, once closed it would leave only two other coal plants operating in mainland Spain, EDP’s 556 MW Abono 2 and 346 MW Soto de la Ribera plants. Fifteen coal units are scheduled to close by 30 June with a further six by the end of 2021 to comply with the European Union’s Industrial Emissions Directive. By July, installed solar capacity is likely to be double that of the remaining coal plants. At the end of May 2020 Spain had 9276 MW of solar capacity, double the amount of a year earlier. (Argus, Argus)

Vietnam boosts wind target as coal plants stall: The Vietnamese Government has agreed in principle to increase the wind power target by 7000 MW in the current version of the country’s power development plan due to delays and opposition to proposed coal plants. The increase would bring the target for wind generation to 11,630 MW by 2023. The Ministry of Industry and Trade has also been asked to submit the next power development plan for 2021–2030 by October 2020. The ministry has also been asked to consider extending the current 20-year feed-in tariff of 8.5 US cents per kilowatt hour (kWh) for onshore wind projects and 9.8 US cents per kWh for offshore projects by two years to cater for projects commissioned before December 2023. Vietnam’s Minister of Industry and Trade, Tran Tuan Anh, said that coal power would decline as a share of generation in the new plant but would be developed in a “reasonable way.” (Dan Tri [Vietnamese], Duane Morris Vietnam)

Australian insurance brokers complain coal supply chain struggling for coverage: Australian insurance brokers report that the shift by insurance companies away from involvement with coal companies is having an impact on all aspects of the coal supply chain from mines to ports. A coal broker noted that insurance such as for professional indemnity for engineers and vehicle fleet insurance was becoming harder to obtain. Brokers complain that while thermal coal producers are finding coverage harder to obtain and more expensive some insurance companies are making little distinction between thermal and metallurgical coal producers. Insurance Campaigner at Market Forces, Pablo Brait, said if insurance companies were acting on science then no new coal project should get insurance and existing ones should only be covered if they have a specified closure date. (Insurance News)

Indonesian exports slump as thermal coal markets hit by COVID-19: Indonesia’s Ministry of Energy and Mineral Resources estimates that in 2020 coal exports could decline to 435 million tonnes, a 24 million tonne fall from 2019. The Chairman of Indonesia Coal Miners Association, Pandu Sjahrir, told a Coaltrans webinar that global seaborne thermal coal demand in 2020 is likely to be about 895 million tonnes, a significant decline from the pre-COVID-19 estimate of 980 million tonnes. The COVID-19 crisis has hit Indonesian exports to the Philippines, China and India. A ministry spokesperson said that the government would look to expand exports to Bangladesh, Pakistan and Vietnam. However, these markets are also being targeted by South African, Australian and Russian exporters. (Reuters)

Indonesian utility reports loss as capacity payments climb: The first quarter report for 2020 by the Indonesian Government-owned power utility, PLN, has revealed revenue rose by only five per cent while expenses, led by payments for independent private power plants, increased by seven per cent. PLN reported a 38.9 trillion rupiah (US$2.8 billion) loss, largely due to notional foreign exchange losses. Guaranteed payments to private power producers are likely to increase further this year as new coal units are commissioned, further undermining PLN’s financial position as power demand growth is curtailed by COVID-19 restrictions. January 2020 data from the Global Coal Plant Tracker indicates that there are 44 coal units, with a combined capacity of 11,840 MW, currently under construction in Indonesia. (Jakarta Post, Global Coal Plant Tracker)

Australian court ruling on mining land hits Glencore: The New South Wales Land and Environment Court has ruled in favour of Muswellbrook Council that that 4150 of 6600 hectares claimed as agricultural land by Glencore subsidiary Mangoola Coal Operations should be classified as mining land for the purposes of levying rates. Mining land is subject to higher rates than agricultural land. The council reviewed land Glencore claimed was being used solely for agricultural production by another subsidiary and found it was being used for air and water monitoring stations, land offsets against cleared land and as a buffer around the mine. Glencore declined to comment but has the option to appeal the decision. (Muswellbrook Chronicle, Sydney Morning Herald, NSW Land and Environment Court)

India launches coal block auctions: India’s Minister for Coal and Mines, Pralhad Joshi, has announced that up to 40 coal blocks will be auctioned off to private companies on June 18. Previously coal allocations to private companies have only been allowed for self-consumption such as by steel, aluminium and cement producers. The auction is expected to attract companies looking to reduce purchases from other coal producers and potentially mining companies seeking to sell coal on the open market in competition with Coal India and importers. With a dramatic decline in coal demand due to COVID-19 restriction, Coal India is lobbying the government for reduced rail charges on coal sold to displace imported thermal coal. (Times of India, Times of India)


Seaborne thermal coal market faces 2020 supply adjustment, Argus Media, June 2020. (Pdf)

This 5-page briefing paper provides an overview of the challenges for Indonesian, Australian, South African, Colombian and Russian thermal coal exporters into the seaborne market.

Getting off coal: orderly, early transition to minimise impact for Australian economy, Australia Institute, June 2020. (Pdf)

This 37-page report argues that Australia needs to plan for an orderly approach to phasing-out thermal coal would avoid the consequences of an unmanaged transition on workers, communities and the economy.