November 28, 2019
Issue 301  |  View Past Issues

Editor's Note

New data suggesting coal-fired power generation may decline by about 3 per cent in 2019 is welcome good news. The report comes as analysis suggests that the rapid expansion of renewables in India may drive the use of coal plants down to extraordinary low levels. While there’s some good news in India, the prospect that China will go from climate leader to laggard overshadows much of climate policy debate. However, financial institutions’ announcements on thermal coal keep piling up. In Italy, the country’s largest bank has announced it will exit thermal coal investments by 2023.

In South Africa, a sitting African National Congress Member of Parliament has been arrested and is facing charges of attempting to offer a bribe to derail a parliamentary inquiry into Eskom. As a Bloomberg columnist notes, the coal industry’s poor reputation may be contributing to the difficulty of obtaining debt funding for coal projects. In a sign of the growing isolation of US coal companies, an internal email revealed that Peabody Energy is finding it hard to attract interest from power utilities for its annual ‘clean coal’ awards.

The coal industry’s ‘clean coal’ pitch is lingering on long after its viability evaporated. In Europe, coal regions are proposing that ‘clean coal’ projects be included as part of their economic transition plans. However, in the US, the Public Service Company of New Mexico has spelled out in detail that it would prefer to retire the San Juan coal plant rather than take on big risks by pursuing carbon capture and storage in a bid to extend the life of the plant.

Meanwhile, China and the US have been having a verbal sparring match over the economic impact of Chinese-backed projects in Pakistan, many of which are coal plants. South Korea, which hosted the ASEAN summit this week, has also been in the spotlight over its role in subsidising the construction of new coal plants in Southeast Asia. In the Philippines, Greenpeace has reviewed the massive coal power expansion plans of five major utilities. A new report into South African companies highlights that many, such as Eskom, still have no greenhouse gas emission reduction target.

Bob Burton


How China moved from a climate leader to laggard

China’s renewed support for coal and waning support for renewables poses a major challenge for achieving the goals of the Paris Agreement, writes Leslie Hook in the Financial Times.

Coal knew, too

A newly unearthed journal from 1966 shows the coal industry, like the oil industry, has long been aware of the threat of climate change, writes Elan Young in Huffington Post.

Bond investors take a tougher stance on fossil fuels

Coal, oil and gas companies are unusually vulnerable to changes in the appetites of lenders, writes David Fickling in Bloomberg.

Top News

Coal power generation in 2019 set to fall: An analysis of global electricity generation for the first seven to ten months of 2019 indicates that coal power production could decline by about 3 per cent. Significant declines in coal generation have been recorded; the largest falls have occurred in the US with significant falls in Germany, Spain, the European Union as a whole and South Korea. India’s coal generation has also fallen significantly, while Chinese growth has flattened. While increased generation has occurred in Southeast Asia, it has been insufficient to offset the decline elsewhere. Increased generation from renewables, gas and nuclear power has been complemented by falling electricity demand in some countries. The reduction in coal generation amounts to about 300 terawatt hours, the equivalent of the combined 2018 coal generation of Germany, Spain and the UK. (Carbon Brief)

Former Zuma minister arrested over Eskom contracts: An African National Congress Member of Parliament, Bongani Bongo, is facing 13 corruption charges after allegedly offering a bribe in an attempt to block a parliamentary inquiry into state capture at Eskom. Bongo is currently the chair of Parliament’s Home Affairs committee and had been appointed by former President Jacob Zuma as Minister of State Security. In 2017, Nththuzelo Vanara, who had been appointed to present evidence to Parliament’s Public Enterprises committee inquiry into state capture at Eskom in 2017, submitted a sworn affidavit in which he alleged that Bongo had offered him a bribe on behalf of some of Eskom’s management team and board members to scupper the inquiry into Eskom. Bongo has been released on bail and his case has been postponed until January 31, 2019. (TimesLive, Daily Maverick)

Study estimates 16,000 premature deaths in US from fossil fuel power plants: A study published in Environmental Science and Technology estimates that PM2.5 fine particle pollution from fossil fuel power plants in the US caused 16,000 premature deaths in 2014. The study found that exposures are higher for lower-income people than those with a higher income but the most notable disparity was greater health impacts on African-Americans and non-Latino whites. The study also found that in 36 states most of the health impacts were from power plants in other states, with most health impacts attributable to coal generation. (Medical News Today, Environmental Science & Technology)

Report details coal plans of big Philippine utilities: Greenpeace has warned that the Philippines risks being locked into a high-carbon future if five major utilities — Meralco, San Miguel Corporation, Lopez Holdings, Aboitiz and DMCI Holdings — are allowed to proceed with plans to build 23,270 megawatts (MW) of new coal plants. The report comes as the Department of Energy has ordered Semirara Mining and Power Corporation (SMPC), the country’s largest coal producer, to suspend operations at its mine on Semirara Island due to a major mudflow in October which killed an employee. SMPC was also recently ordered to suspend its coal trading operations and fined 1.75 million pesos (US$34,000) for operating without proper authorisation. (Greenpeace Philippines, BusinessWorld)

South Korea under pressure over support for Asian coal plants: Ahead of major Association of Southeast Asian Nations summits hosted by South Korean President Moon Jae-in, a coalition of local and international NGOs have taken out a front page advertisement in the Korea Times urging South Korea to rule out financial support for coal projects such as the 2000 MW Jawa 9 and 10 plants in Indonesia. A report released by Greenpeace Southeast Asia estimates that South Korea’s financial support for 10 overseas coal plants could cause between 47,000 and 151,000 premature deaths over 30 years in countries such as Vietnam, Indonesia and Bangladesh. The lobbying comes as South Korea’s Ministry of Trade, Industry and Energy announced that, in a measure to cut fine particle air pollution during winter, generation at the country’s coal plants would he capped at 80 per cent of capacity between December 2019 and February 2020. (Greenpeace Southeast Asia, Yonhap News Agency)

Utilities shun Peabody Energy ‘clean coal’ awards: When Peabody Energy recently announced the 2019 winners of its Peabody Global Clean Coal Leadership Awards, not one was for a power utility. In an internal December 2018 email, a Peabody Energy executive, Bryan Galli, stated that it was “hard these days for utilities to take the praise publicly” and that the 2018 awards “could very well be the last one.” Peabody Energy, which operates major coal mines in the US and Australia, established the awards in 2014 to “raise the profile of clean coal technologies.” (Energy and Policy Institute)

European coal regions push ‘clean coal’ as part of exit package: Representatives from 14 coal regions attending the annual meeting of the European Union Platform for Coal Regions in Transition have backed a declaration calling for “clean coal technologies” as part of plans to phase out coal. The coal industry promotes ‘clean coal’ to mean new slightly more fuel-efficient power plants or plants which include expensive carbon capture and storage technology. Europe Beyond Coal rejected the suggestion as a “futile” delaying tactic promoted by the coal industry which, if adopted, would “lock regions into many more years of polluting and uneconomical coal.” (Clean Energy Wire, Europe Beyond Coal)


Australia: The CEO of ANZ, a major bank, tells a parliamentary inquiry ANZ does not have a thermal coal exit deadline, unlike other major domestic banks.

Australia: AGL issued with breach notices because multiple spot fires occurred in its Loy Yang mine but the fire authorities were not immediately notified.

China: Coal ship reported aground and swamped near a coal plant in southern China.

Czech Republic: Lignite mining company Sokolovska says it will cut 1000 jobs over the next two years as carbon price hits demand.

Indonesia: Eighteen months after a barge accident, coal still pollutes Sumatran beaches despite cleanup.

UK: Despite loss, GCM Resources plans to press ahead with proposed 6000 MW Phulabiri plant and mine in Bangladesh with the assistance of lobbyists in China and Bangladesh.

US: Somerset Operating Company is seeking approval to close the 675 MW Somerset plant, the last coal plant in New York State, in February 2020.

Vietnam: Deputy Minister of Industry and Trade Dang Hoang An expresses [Vietnamese] interest in investing in South African export-oriented thermal coal mines to supply new coal plants.

Companies + Markets

More European banks unveil thermal coal lending bans: UniCredit, Italy’s largest bank by assets, has announced it will halt all lending for thermal coal projects by 2023. The new policy would take effect immediately but existing deals would gradually expire by 2023. The France-headquartered bank, BNP Paribas, last week announced it would cease financing thermal coal projects in the European Union by 2030 and worldwide by 2040, stating that it would cease support for companies planning new coal plants. However, the bank’s new policy was silent on withdrawing support for coal mining or infrastructure projects and committed only to “intensify its dialogue” with utilities that operate existing coal plants. (Reuters, BNPParibas)

KPMG flags falling plant load factors will pose big challenges to Indian coal plants: KPMG estimates that if 135,000 MW of new renewables capacity is commissioned in India by 2022 the plant load factor for existing coal plants could fall from the current level of 51 per cent to as low as 35–40 per cent. The official Indian Government target is for 175,000 MW of renewables to be commissioned by 2022. KPMG estimates that plant load factors at Indian plants of 40 per cent “would require retrofitting of plant equipment and instrumentation along with extensive changes to operating practices” and staff training to handle ramping plants up and down. KPMG estimates the costs are unlikely to be worthwhile for old plants while operating at lower levels at other plants is unlikely to be feasible unless coal quality is improved and equipment upgraded. (Economic Times)

Utility backs coal plant closure instead of CCS retrofit: The Public Service Company of New Mexico (PNM) has estimated that the cost of retrofitting the 940 MW San Juan Generating Station with carbon capture and storage (CCS) technology would cost US$1.3 billion more than its preferred option of retiring the plant in 2022. PNM estimated that a CCS unit would consume about one-third of the power output of the plant and increase water consumption by between 50 and 60 per cent. PNM also warned that CCS technology was unproven at the scale proposed and there were doubts whether selling captured carbon dioxide (CO2) for enhanced oil recovery would outweigh the benefits. PNM also warned there was uncertainty over the economic impacts on customers given uncertainties over the sale of CO2 and potential future carbon costs. (Utility Dive)

India pursues Russian metallurgical coal prospects: India’s Minister of Steel, Dharmendra Pradhan, has met with Russian officials and industry players to discuss increased investment in railway and port capacity to reduce the costs of metallurgical coal exports from the Far East. India produces little metallurgical coal and in 2018 imported about 50 million tonnes for its growing steel sector, with the bulk originating from Australia. India is looking to diversify away from an overreliance on Australian exports while Russia is seeking to expand coal exports into the Asian market to boost foreign exchange earnings. The Indian delegation at the talks also included representatives from the Adani Group, Hindalco, JSW Steel, JSPL, Tata Power and government-owned companies. (Business Insider, Reuters)

South African companies have few plans to cut emissions: A Center for Environmental Rights review of 10 major South African companies found they performed poorly against international risk management benchmarks. Eskom, which contributes 39 per cent of South Africa’s greenhouse gas emissions, has no reported emissions reduction target. Sasol, which converts coal to liquids and chemicals and is the country’s second-largest emitter, has set an emissions reduction target of only 10 per cent. In a presentation to Parliament, the Department of Public Enterprises claimed that Eskom’s compliance with pollution standards limiting fine particle, sulphur dioxide and nitrogen oxide emissions would cost about 187 billion rand (US$12.60 billion). The standards first came into effect on April 1, 2015 but Eskom was granted a five-year delay. It is now seeking a further delay. (Biznews, Reuters, Center for Environmental Rights)

US and China spar over economic impacts of Pakistan projects: The US Government’s Deputy Assistant Secretary of State for South and Central Asia, Alice Wells, has warned Pakistan that projects funded under the China–Pakistan Economic Corridor (CPEC) would impose a growing economic toll on the economy as debts come due. Wells warned that non-concessional loans were often backed “with sovereign guarantees or guaranteed profits for Chinese state-owned enterprises” and that even if repayments were deferred they “would hang over Pakistan’s economic development potential.” Thirteen energy projects are being pursued under the CPEC, with coal projects featuring prominently. China’s Ambassador in Pakistan, Yao Jing, dismissed the criticism claiming that “China will never ever ask for these loan repayments as long as you are in need of this money.” The spat comes as new coal projects are being pursued including a coal-to-urea project in the Thar lignite fields and the 1320 MW Thar Coal Block-I plant. Financial close has also been reached on the second 600 MW unit at the Jamshoro coal plant which is being funded through non-Chinese sources. (Radio Free Europe, Voice of America, VoxMarkets, The News)

Coal India boasts of big coal mine expansion plans: India’s Minister for Coal, Pralhad Josh, has told parliament that the government-owned coal mining company, Coal India, has plans to open 55 new coal mines with a combined capacity of 92 million tonnes a year and to expand a further 193 existing mines to increase production by a further 310 million tonnes a year. Coal India claims these projects will be completed over the next five years. While the Indian Government has repeatedly stressed the importance of reducing thermal coal imports, which reached to 164 million tonnes in 2018, coal generation has recently declined as the economy slows and renewables generation undercuts expensive existing plants. (The Hindu)

Retirement plans for Montana coal plant accelerated: Avista Corporation, which holds a 15 per cent share in two 778 MW coal units at the Colstrip plant in Montana, has agreed to retire its debt on the plant to be ready to exit the plant by 2025. The commitment follows an intervention in a power rate case in Washington State by a coalition of NGOs, with a 2025 exit date bringing it into line with the state’s coal exit law. Beyond 2025 Avista will not contribute to maintenance costs at the plant, making the costs higher for the remaining owners and increasing the prospect it will be retired. Puget Sound Energy, which has a 25 per cent stake in the units, has previously stated the units would be retired in 2027. A coalition of environmental groups has also filed a legal appeal against the June 2019 decision of the US Department of the Interior to approve a major expansion of the Rosebud coal mine which is the sole supplier of the Colstrip plant. (Casper Star-Tribune, Montana Free Press)

Australia presses ahead with coal-based hydrogen plan: The Australian Government has won support from a majority of state governments for its proposed hydrogen production strategy including coal and gas feedstocks if they incorporated carbon capture and storage technology to catch 90 per cent of plant CO2 emissions. The ACT Government had proposed excluding fossil fuel projects from consideration but was rebuffed. The Australia Institute, a progressive think tank, has warned that the Australian Government risks rushing ahead with a coal-based hydrogen strategy based on massively overinflated estimates of hydrogen demand in Japan and South Korea. In 2018 the Australian and Victorian governments jointly pledged to contribute A$50 million each into a proposed A$496 million project in Victoria based on gasification of brown coal which would produce only 3 tonnes of hydrogen. (RenewEconomy, RenewEconomy, Guardian)


Production Gap, United Nations Environment Program, November 2019. (Pdf) (The Executive Summary  is here.)

This 80-page report documents the gap between achieving the Paris Agreement goals of limiting global heating to 1.5°C or 2°C and countries’ planned production of coal, oil and gas.

Double Standard, Greenpeace Southeast Asia, November 2019. (Pdf) (The Executive Summary is here.)

This 52-page report details the health toll South Korean support for 10 coal plants is likely to impose on people in Vietnam, Indonesia and Bangladesh.

Dirty Business, Greenpeace Philippines, November 2019. (Pdf)

This 32-page briefing paper reviews plans for a massive expansion in coal capacity by the Philippines’ four largest power utilities.

Collie at the crossroads: planning a future beyond coal, Beyond Zero Emissions, November 2019. (Pdf) (The media release is here.)

This 66-page report outlines some economic possibilities for the town of Collie in Western Australia after the closure of the nearby coal power plants and mine.

European Coal Exit Tracker, Europe Beyond Coal Europe, November 2019.

This new tracker provides a continent-wide and country-by-country breakdown of coal plant retirements since 2016, the estimated health impacts, greenhouse gas emissions and details of individual countries’ coal exit plans.

Beyond Coal Australia, November 2019. (Website)

The new Beyond Coal Australia alliance has launched a website complete with a background details on Australia’s remaining coal plants and proposed renewable generation.