July 15, 2021
Issue 377  |  View Past Issues

Editor's Note

In the wake of Chile’s lower house voting for a 2025 coal power end date, the local subsidiary of the US utility AES has confirmed it will close its 558 MW Angamos plant. The future of the plant was effectively brought forward by 12 years when mining giant BHP ended its power purchase agreement for coal power from the plant, preferring instead to source cheaper renewable electricity. Investor interest in coal in India has also declined, with over two-thirds of coal blocks offered up for auction by the central government failing to attract a single bid. The President of Sri Lanka is pushing for an increased commitment to renewables by 2030, which will come at the expense of one or more coal or other fossil fuel projects.

Adani, which bid on one of the coal blocks, has also been revealed as planning a massive expansion in both coal mining in India and Australia and coal power plants in India. An Australian NGO has pointed out the contradiction of major banks promising to protect the climate and simultaneously underwriting Adani’s grand plans. As large financial companies have moved to restrict or exclude coal companies, the major “passive” financial investment funds such as Vanguard have remained unmoved. Passive funds are effectively set on auto-pilot to invest in all the large companies on a stock exchange no matter how poorly performing they are or how much damage to the global climate they do. Changing the investment parameters of the passive funds would have significant knock-on effects on the largest fossil fuel companies.

Bob Burton


In Goa, the water runs black

Locals near one of India’s coal-importing ports feel the effects of coal dust and are bracing for an even unhealthier future, writes Disha Shetty in Hakai Magazine.

Japan still seeking to exploit coal power loopholes

Japan is continuing to push its expensive coal-fired power technology on developing nations if such projects feature carbon capture and storage or if a proportion of ammonia or biomass is co-fired with the coal, writes Simon Nicholas from the Institute for Energy Economics and Financial Analysis

Passive investors’ hands aren’t tied on fossil fuels

Vanguard and other asset managers want us to believe that passive investing means they can’t take active decisions to exit fossil fuels. But that is not the case, writes Justin Guay from The Sunrise Project in Responsible Investor.

Top News

AES unveils closure plan as Chile considers 2025 coal phase-out: The US utility AES will close the Angamos 1 and 2 units, which have a combined capacity of 558 megawatts (MW), by the end of December 2024. AES originally had contracts to supply electricity from the two units to BHP until 2026 to 2037. However, BHP decided to terminate the power purchase agreement in favour of cheaper renewables. In September 2020, AES said it would phase that plant out when it was no longer required by the Chilean grid operator. AES has previously sought approval for the closure of Ventanas units 3 and 4, which have a combined capacity of 322 MW. Chile’s lower house recently passed a bill requiring the closure of all coal units by 2025. (Argus, Global Energy Monitor)

Sri Lankan President backs renewables, raising doubt about coal units: President Gotabaya Rajapaksa has directed the Ceylon Electricity Board (CEB) to implement his policy of requiring 70 per cent of electricity generation to come from renewable sources by 2030. The CEB’s current generation plan aims to source 55 per cent from renewables. The increased target has not been gazetted but when it is, would require the scrapping of 950 MW of proposed coal and/or gas units. Sri Lanka currently has three 300 MW coal units with the construction of a fourth recently allocated without tender to China Machinery Engineering Corporation. The existing units have been notoriously unreliable. A further coal unit has been flagged for the site along with three other 400 MW units at another unspecified location included in the CEB’s March 2020 long-term power generation expansion plan. It is unclear which coal projects will be affected by Rajapaksa’s direction. (Sunday Times)

Australian court orders minister to consider children in coal mine decision: Federal Court judge Justice Mordecai Bromberg has directed Australia’s Federal Environment Minister, Sussan Ley, “to take reasonable care” to “avoid causing personal injury or death” to Australian residents under 18 “arising from emissions of carbon dioxide into the Earth’s atmosphere” when she decides whether to grant approval for the expansion of Whitehaven Coal’s Vickery coal mine. The Vickery project would produce up to 10 million tonnes of coal a year with 40 per cent thermal coal and the remainder metallurgical coal. Ley has announced the Australian Government will appeal Bromberg’s decision. (Guardian, Guardian)

China elevates role of economic planning agency in charting transition: Responsibility for the development of China’s climate policies has been transferred from the Ministry of Ecology and Environment (MEE) to the country’s powerful economic planning agency, the National Development and Reform Commission (NDRC). NDRC was stripped of responsibility for climate policies in 2018 after criticism it had approved huge numbers of new coal plants. MEE will reportedly have responsibility for overseeing the carbon market, emissions reporting and international cooperation while NDRC will have responsibility for developing plans to cut emissions, especially in power generation and metals production sectors. (Bloomberg)

Study warns Bulgaria’s coal reliance will increase summer water conflicts: A study by scientists at Leiden University in the Netherlands has warned that water flows in the Maritsa River will decline by 2050, especially during summer, leading to competition for scarce water between coal power generation and urban, agricultural, and industrial sectors. Bulgaria’s National Energy and Climate Plan commits to continued reliance on lignite generation until 2050, with 90 per cent of the country’s coal generation in the Maritsa catchment. The report notes the Maritsa River basin is projected to be among the most heavily affected by climate change in Europe. Bulgaria’s coal and nuclear power plants currently account for about 70 per cent of the country’s fresh water use. (Greenpeace)

Pollution from Western Balkan coal plants dwarfs European Union emissions: A review by the Centre for Research on Energy and Clean Air (CREA) of sulphur dioxide emissions from 18 coal plants in the Western Balkans found they emit twice as much as all 221 coal plants in the European Union (EU). The plants are in Bosnia and Herzegovina, North Macedonia, Montenegro, Serbia and Kosovo. Under the terms of the 2005 Energy Community Treaty, 17 of the 18 plants are required to meet the pollution control standards of the EU’s large combustion plant directive to cut sulphur dioxide, and nitrogen oxides and dust pollution. CREA found that three years after the January 2018 deadline only two plants have installed desulphurisation equipment and in neither case is it in commercial operation. The other plants either have no plans to close or to fit pollution control equipment despite the threat to public health. (Centre for Research on Energy and Clean Air)

“All pure-play coal companies are rated below investment grade today,”

states [paywall] Moody’s in a review of the global coal industry.


Australia: Groundwater levels near Adani’s Carmichael mine have plummeted in the last two years raising concerns about the sacred Doongmabulla Springs.

Brazil: Legislator says power utilities set to lose tax exemption for coal purchases.

Canada: Poll reveals overwhelming support for wind and solar energy with just 19 per cent of respondents backing coal.

Germany: Vattenfall’s 1600 MW Moorburg coal plant closes after only six years online.

India: Coal train derailment results in some loaded wagons  falling into the Ailan River in Madhya Pradesh.

Indonesia: Government official says COVID-19 surge has infected “quite a lot” of workers in the East Kalimantan coal sector.

New Zealand: Country’s largest meat processor vows to halve coal consumption at its processing plants by 2023 and phase it out completely by 2030.

Philippines: Call to extend ban on new coal plants to include those under construction or that have been approved.

Russia: Finnish utility Fortum to sell its 195 MW Argayash coal plant to a subsidiary of Russian state-owned Rosatom.

Companies + Markets

ArcelorMittal announces green steel project for Spain: ArcelorMittal, a global steel and mining company, has entered into a memorandum of understanding with the Spanish and Basque regional governments to build a €1 billion (US$1.2 billion) hydrogen-powered direct-reduced iron plant at its Gijon steel plant. The MOU also provides for the construction of a new electric arc furnace as part of its plan to produce zero-carbon-emissions steel by 2025. However, details of the financial support provided by the provincial and national governments are not clear. The project also relies on solar-based hydrogen production on the Iberian Peninsula with the fuel transported to the Gijon plant via a network of pipelines. (BloombergQuint, ArcelorMittal)

Indian coal block auctions attract few bidders: The attempt by India’s Ministry of Coal to auction off 67 coal mines has attracted bids for just 19 coal allocations. Only eight potential mines attracted more than a single bid. Of the 19 proposed mines, 15 are thermal coal projects and four are metallurgical coal projects. Of the 34 bids, five were for the Burakhap Small Patch block with a further four on the neighbouring Rauta Closed Mine block in Jharkhand. The combined capacity of the two blocks is estimated to be 800,000 tonnes a year with a combined estimated resource of just 17 million tonnes. Of the 20 companies submitting bids, 12 submitted one bid while Sunflag Iron and Steel and Company and Aurobindo Realty and Infrastructure submitted four each. (Reuters, Ministry of Coal)

Adani’s carbon negative pitch dismissed as greenwashing: Market Forces, an Australian NGO group, has called on major financial institutions, such as Blackrock, JP Morgan Chase, TIAA, MUFG, the State Bank of India and HSBC, to end their support for the Adani Group due to the company’s plans for a major expansion of fossil fuel projects. Market Forces found Adani Group is planning to increase its coal power generation by a further 12,000 MW in addition to its current 12,450 MW of coal plants and increase coal production from its current 17.5 million tonnes to 132 million tonnes. Adani shares have been hit by adverse publicity after it was revealed three funds headquartered in Mauritius, which hold about US$6 billion in Adani Group shares, were suspended in mid-June by India’s national share depository. (Bloomberg, Economic Times, Market Forces)

Private finance dominates public funders of coal plants: A study by Boston University’s Global Development Policy Centre estimates China accounted for only 13 per cent of total financing for overseas coal power projects between 2013 and mid-2019. However, in that period China accounted for 50 per cent of global public finance commitments for overseas coal projects. The study estimates 87 per cent of public and private finance for overseas coal plants is funded by major private and public financial institutions from Japan, the US and UK. The authors endorse the need for phasing out public and private overseas coal projects but also urge the G20 group of countries to formalise a framework for disclosure of coal plant funding “so the global community can properly track, monitor and hold public and private actors accountable to new commitments.” (South China Morning Post, Boston University)

Texas regulator found coal, gas and nuclear plants behind June grid constraints: New data released by the Electric Reliability Council of Texas, the grid regulator, has confirmed unplanned outages from coal, gas and nuclear plants were the dominant factors behind the generation shortfall in June which led to a request to consumers to cut power usage. Four coal plants contributed to the 12,000 MW in unplanned outages: the 1660 MW Limestone plant and the 1120 MW W.A. Parish plant, both of which are owned by NRG Energy, the 2379 MW Martin Lake plant and the 1008 MW Sandy Creek plant. Wind generation was also lower than forecast, though Daniel Cohan from Rice University said the data also indicates solar generation “kept the lights on”. (Dallas Morning News)

Botswana pitches for funding to connect to export markets: Minerals Development Company Botswana is pitching to potential Chinese investors for funding for a 125 kilometre rail link to connect potential coal mining projects to South Africa’s coal export infrastructure. A recent presentation to Chinese investors estimated the cost of a rail link capable of carrying 25 million tonnes a year at between US$150 million and US$250 million. Last year Botswana’s Minister of Mineral Resources, Lefoko Moagi, said the country has a lot of coal and “we just can’t leave an abundance of a God-given resource like that.” (Bloomberg)

South African loan for coal highlights flawed bank policy: The Center for Environmental Rights (CER), a South African NGO, argues the 2017 decision of the government-owned Industrial Development Corporation (IDC) to finance the development of MC Mining coal projects is a telling example of funds being invested in environmentally destructive and climate-incompatible industries. MC Mining, an Australian headquartered company, was loaned 160 million rand in 2017 (US$11.1 million in current values) to develop its Makhado Colliery Project in Limpopo province and upgrade the Vele Colliery near the Mapungubwe National Park and World Heritage Site. The CER argues the decision to back MC Mining’s projects, despite the company’s early history of environmental non-compliance, illustrates the inadequacies of the IDC’s Responsible Investment Policy. (Center for Environmental Rights)


Who Funds Overseas Coal Plants? The Need for Transparency and Accountability, Boston University, July 2021. (Pdf)

This 10-page policy brief compares financing for international coal plants by China’s public banks and with the public and commercial banks of other countries and finds China’s role has often been overstated.

The Unquenchable Thirst of Energy Production, Greenpeace Bulgaria, July 2021. (Pdf)

This 13-page report details the results of a Leiden University study into the increasing competition for water from the Maritsa River between Bulgaria’s coal power plants and other users in a drying climate.

Responsible disengagement from coal as part of a just transition, Centre for Research on Multinational Corporations, June 2021. (Pdf)

This 54-page report outlines what the roles and responsibilities are for coal mining and power companies in a just transition strategy in the Cesar region in Colombia. Serious human rights violations by paramilitaries occurred during the 1990s and 2000s when Drummond and Prodeco/Glencore established and expanded coal mines and now the future for coal workers and communities is increasingly uncertain.