October 21, 2021
Issue 391  |  View Past Issues

Editor's Note

Restrictions on coal volumes and the resultant price spikes neatly illustrate the dangers of overreliance on coal generation. In Indonesia, exceptionally heavy rainfall in major coal-producing provinces has slowed exports, with potential knock-on effects on prices in the export market. A fire at a Russian coal export terminal may add more pressure to the export market. Coal India’s prioritisation of the short-stocked power sector has had knock-on effects on the energy-intensive aluminium sector which in turn has boosted demands from the grid. As Vibhuti Garg from the Institute for Energy Economics and Financial Analysis notes, the current crisis illustrates how coal is an expensive and unreliable option for electricity grids.

More countries have flagged possible new coal phase-out plans. The three German parties considering forming a coalition government will discuss the option of bringing the coal exit forward from 2038 to 2030. Bulgaria is pitching for an end date of 2038 or 2040 despite the financial and legal problems confronting coal generators. South Korea is touting 2050 as its possible coal end date. In South Africa, Eskom is caught between a minister uninterested in an accelerated coal phase-out, crippling financial problems and an unreliable coal fleet. In the US, a Senator with a significant personal interest in the coal sector is pressing to strip the Clean Electricity Performance Program out of President Joe Biden’s Build Back Better plan.

Bob Burton


Analysis: How power shortages might ‘accelerate’ China’s climate action

The latest directives by China’s leadership on addressing the coal supply shortage and power cuts could further accelerate the development of green energy, writes Xiaoying You in Carbon Brief.

India: Energy crisis shows coal is an expensive and unreliable source of electricity generation

Responding to India’s current energy crisis by supporting more investment in coal would completely miss the point that the country needs cheap and flexible power supplies, writes Vibhuti Garg from the Institute for Energy Economics and Financial Analysis.

Why the people of India’s Hasdeo forests are marching against Adani coal mines

Hundreds of Adivasi (indigenous) community members have marched over 300 kilometres to protest against the expansion of coal mining in the Hasdeo Aranya forest, write Vijay Ramamurthy and Tara Roy in AdaniWatch.

Where a US$5 billion green incentive runs into politics of coal

When envoys from the US, UK and Germany recently met South African Government ministers to discuss a US$5 billion package to transition away from coal power, the Minister for Energy, Gwede Mantashe, didn’t turn up. It highlighted the political challenges ahead for a transition away from coal, write Antony Sguazzin and Paul Burkhardt in Bloomberg.

Top News

UK Science Museum embraces sponsorship deal with Adani: London’s Science Museum has accepted sponsorship from an arm of Adani for a new “Energy Revolution” gallery to open in 2023. While the new sponsorship deal is with Adani Green Energy, the renewables arm of the diversified company, a spokesperson for Behind the Logos, a UK group campaigning against fossil fuel greenwashing campaigns, said the museum can’t separate itself from the track record of the parent company which has been embroiled in controversy over its ties with the Myanmar military regime, the development of the Carmichael coal project in Australia and plans for a doubling of coal plant capacity in India. The Science Museum has been the target of protests for accepting funding from oil and gas companies. (Financial Times [paywall], Science Museum, Behind the Logos)

German parties agree to negotiate over 2030 coal exit: The three potential coalition partners in Germany's new government – the centre-left Social Democrats, the Greens and the pro-business Free Democrats – have agreed to include an end of coal power generation by 2030 and expansion of renewables as a central issue in their negotiations. Germany’s current coal exit legislation sets the end date at 2038 by the latest. However, a recent the Constitutional Court decision ruled the country's 2019 Climate Protection Act is unconstitutional and needs a more ambitious emissions reduction target. The finalisation of a coalition agreement is possible before Christmas but the Free Democrats’ support for a minority government is not guaranteed. (Euronews)

Bulgaria unveils pitch to keep struggling coal sector going to 2040: Bulgaria’s interim Prime Minister, Stefan Yanev, said the coronavirus recovery plan submitted to the European Commission will propose 2038 or 2040 as the country’s end date for coal generation. Bulgaria currently has 12 operating coal plants with a combined capacity of 4829 megawatts (MW). The Bulgarian Government will have to negotiate an agreed coal phase-out date with the commission before it can access funds from the €800 billion (US$930 billion) pandemic recovery package. Greenpeace Bulgaria said the late end date ignored the financial problems with the 1602 MW Maritsa East 2 lignite plant which is subject to a legal challenge over breaches of European pollution standards. (Euractiv, Beyond Coal Europe)

South Korea under pressure to step up coal phase-out: South Korean civil society groups have called on the government to accelerate the retirement of existing coal plants and block the construction of new projects. An official committee advising the South Korean Government on achieving carbon neutrality has proposed two possible scenarios, both of which assume coal generation has been phased out by 2050. The government’s preferred scenario is scheduled to be finalised on October 27 ahead of the COP26 climate conference in Glasgow. South Korea’s recent nationally determined contribution under the terms of the Paris Agreement proposes only a 32 per cent decline in coal generation by 2030 from a 2020 baseline. Solutions for Our Climate said the country remains “a laggard relative to G20 countries”. South Korea is the world’s fourth largest buyer of thermal coal, importing 84 million tonnes in 2020. (Korea Times, Argus, Argus)

US President’s climate plan opposed by Manchin: President Joe Biden’s proposed Build Back Better plan is currently stalled in part because of opposition by West Virginia Democrat Senator Joe Manchin to inclusion of the Clean Electricity Performance Program. Manchin argues the transition away from coal is occurring without the program. However, critics point out the shift is occurring slower than proposed and is uneven across the states. The program would require power utilities to source 80 per cent of their power from low-carbon sources by 2030, increasing to 100 percent by 2035. The plan would require power utilities to supply four per cent more clean energy per year to customers with grants available for clean electricity investment, assistance with bills and support for workers. Utilities that fail to meet the target would be liable to pay US$40 per megawatt hour for the shortfall. Biden is hoping to finalise the bill before the Glasgow climate summit. (New York Magazine)

Global law firm reveals it advised Ohio utility on bailout bill: Abid Qureshi, a partner of the global law firm Akin Gump Strauss Hauer & Feld, has told a federal bankruptcy court that the firm was actively involved in the campaign by FirstEnergy Solutions for the US$1.3 billion bailout legislation for two Ohio nuclear plants. The bill which was adopted by the Ohio legislature was extended to include two coal plants. The firm was paid US$67.9 million for its work which included supporting efforts by Generation Now, a utility front group, to promote the bailout legislation and defeat a referendum seeking to overturn it. One Akin Gump adviser, Geoffrey Verhoff, wrote in a sworn declaration that he provided advice in 2018 to FirstEnergy on making political donations to Generation Now, the Republican Governors Association, the Democratic Governors Association, the Ohio Senate Campaign Committee and other ‘dark money’ 501(c)(4) organizations. “Similar meetings are common at the federal level in my experience,” he wrote. (Dispatch, Cleveland)

Indian villagers challenge coal project as farmers disrupt rail lines: Villagers have blocked officials from NTPC, India’s publicly owned power utility with coal mining interests, from marking out the boundaries of two coal blocks allocated to it and Adani in the Gondalpura area of Jharkhand. At an October 2 meeting at Badam, near NTPC’s coal block, the villagers voted to block any mining company officials from entering the village unless they had the permission of the village council. In the state of Haryana, villagers occupied rail tracks blocking at least 10 coal trains to protest against the deaths of five farmers by a car allegedly driven by the son of the Minister of State for Home Affairs, Ajay Mishra. (AdaniWatch, The Hindu)

Report estimates coal production overshoot for 1.5 degree target: A report to the United Nations estimates current government plans and projections could result in 240 per cent more coal being produced in 2030 than is consistent with the Paris Agreement goal of limiting global warming to 1.5°C. The Production Gap Report 2021, prepared by the Stockholm Environment Institute, argues coal production will have to decline by 11 per cent per year between 2020 and 2030 to be consistent with a 1.5°C pathway. (ABC News, Stockholm Environment Institute)

“Who wouldn't love a type of technology that captures carbon and utilizes it in a way that extends the life of a coal-fired power plant, extends the life of a coal mine, and extends the life of an oilfield,”

said US Senator Kevin Cramer at a Goldman Sachs event promoting a carbon capture project in North Dakota.


Australia: The South Korean utilities company KEPCO is seeking leave in the High Court to appeal against the rejection of its Bylong Valley coal project.

Australia: Extinction Rebellion supporter occupied a coal train in protest at the Federal Environment Minister appealing against a court ruling that she has a duty of care to protect children from climate damage.

Botswana: Government enters into agreement for Tlou Energy’s 10 MW Lesedi coal-bed methane project.

Portugal: Utility EDP proposes converting the site of its recently closed 1200 MW Sines plant into a green hydrogen hub.

“The reality that I think we all have to accept is that the institutional capital world is done with coal,”

said Stacey Dahl, an executive at Minnkota, a small US power utility unable to raise private funding for a carbon capture project.

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Companies + Markets

Indonesia coal exports hit by heavy rains: Heavy rainfall in Indonesia’s coal-producing provinces of Kalimantan and Sumatra has curbed coal exports despite high export market prices. Data from Indonesia’s meteorology agency indicates that August rainfall in Kalimantan was twice the monthly average of the period between 1981 and 2010. In April the Ministry of Energy and Mineral Resources raised its 2021 output target to a record 625 million tonnes, up 11 per cent on 2020’s output. In the year to the end of September, coal production has increased by 8.7 per cent compared to 2020. However, exports have fallen 4.6 per cent to 230 million tonnes compared to last year. (Reuters)

Indian coal shortage hits aluminium producers: India’s aluminium industry, which accounts for about 5 per cent of national electricity demand, has been hit by Coal India’s decision to prioritise coal supplies to the power sector and curtail spot auctions. As a result of curtailment to industrial customers, which rely on deliveries for captive coal plants, the aluminium sector has turned to power supplies from the grid. In Odisha, which accounts for over half of India’s aluminium production, electricity demand increased by 25 per cent during the first half of October, five times the national electricity growth rate. (Mint)

Fire disrupts Russian coal export terminal: A fire on October 11 at the Vanino coal export terminal owned by Siberian Coal Energy Company (SUEK) has caused major damage to the conveyor system. SUEK declared force majeure on contracts as coal loading operations were suspended as a result of the fire. It is currently unclear how long the terminal will be out of action. The terminal, which currently has a capacity of 24 million tonnes a year, is currently being expanded to cater for exports of up to 40 million tonnes a year to cater for demand from China, South Korea, Japan and Taiwan. Industry sources suggest some coal could be diverted to another nearby terminal but reduced exports could push export prices higher and result in increased demand for Indonesian coal. (Maritime Executive, S & P Global)

BHP says China ban on Australian coal imports could last years: BHP’s CEO, Mike Henry, confirmed there have been no new thermal or metallurgical coal sales to China despite the country’s recent fuel shortage. Henry said BHP, which is the world’s largest exporter of metallurgical coal and a major thermal coal producer, doesn’t expect any sales to China in the “near term” and is assuming “the restrictions stay in place for a few years.” S&P Global Platts data on recent metallurgical coal purchase indicates Chinese buyers paid about 55 per cent more than for cargoes from North Queensland. Chinese imports from Mongolia have been hampered by COVID-19 restrictions while a fire at a Russian coal export terminal has also affected supplies. (Australian Financial Review [Paywall])

Eskom to appeal deferral of power price application: Eskom has filed an appeal in the Gauteng High Court against a decision by the National Energy Regulator of South Africa (NERSA) to reject its bid for a power price rise for 1 April 2022 to 31 March 2025. NERSA’s decision proposed Eskom could apply for an interim price rise under a new process that has yet to be finalised. Eskom argues the regulator’s proposal is “incapable of lawful completion in time for the 15 March 2022 deadline” which could leave the utility unable to charge tariffs and force it to ask the government to provide up to 300 billion rand (US$2.7 billion) for the next financial year. Eskom, which stated in an affidavit that NERSA’s decision was only carried on the casting vote of the acting chair, has requested a hearing before December 1. (MoneyWeb)

South African project may be hit by Chinese ban on overseas coal plants: The backers of the proposed 1320 MW coal plant in the Musina-Makhado special economic zone (SEZ) in Limpopo province have expressed concern that China’s ban on new overseas coal plants will result in the plant being abandoned. Lehlogonolo Masoga, the CEO of the SEZ, said they want the South African Government to “facilitate interaction with the Chinese authorities in the country to get more clarity” about the fate of the project. The project was first revealed in July 2018 when the government signed a memorandum of understanding (MOU) with Chinese state-owned companies to develop a proposed US$10 billion metallurgical complex. The MOU stated PowerChina would finance and build the new plant, one of the largest proposed coal plants in Africa. (Sunday Times, Global Energy Monitor)

US CCS project loses lead contractor: Fluor Corporation has withdrawn from its role as lead contractor of Minnkota Power Cooperative’s (MPC) proposed US$1 billion carbon capture and storage project at the 692 MW Milton R. Young coal plant in North Dakota. Fluor’s withdrawal is reportedly because of a corporate-wide shift away from fixed price construction projects. The project, which received US$43 million in grants from the Department of Energy (DOE) under President Trump, has been unable to attract private finance. MPC is seeking US$700 million in loan guarantees from DOE and access to a US$250 million state loan program created for the project. The project proposes to capture 90 per cent of the carbon dioxide emissions from one of the two units at the plant which were commissioned in the 1970s. (S & P Global)


North American coal producers plan $US4.8 billion on 15 mines for steel export markets, Global Energy Monitor, October 2021. (Pdf)

This 8-page briefing paper details 15 proposed metallurgical coal mines in the United States and Canada and outlines the financial risks associated with them as steel producers are under pressure to pivot away from coal-based production.

Facility level net-zero steel pathways: Technical report on the first scenarios of the Net-zero Steel Project, Net Zero Steel, October 2021. (Pdf)

This 34-page report provides a detailed analysis of potential pathways for achieving net-zero steel production by 2050.

No New Coal Factbook, Ember, October 2021. (Pdf)

This 95-page report provides brief profiles on the 44 governments that have committed to no new coal, the 40 governments that have no proposed new coal projects and the 37 countries that still have proposed coal projects.

Phasing Out Unabated Coal: Current Status and Three Case Studies, International Energy Agency, October 2021. (Pdf)

This 39-page report collates data on current government commitments to phase out unabated coal plants and provides case studies on Ontario, the UK and Germany.