September 16, 2021
Issue 386  |  View Past Issues

Editor's Note

How fast can the transition away from coal power occur? A new report notes the number of proposed coal plants has declined dramatically since the 2015 Paris Agreement.

In Europe, the impact of high carbon prices is beginning to bite, especially in countries that have kept polluting old coal plants in the grid. Polish electricity consumers are facing power price hikes due to the resistance of utilities and the government to investing early in renewables. In Slovenia, a power utility is seeking a government bailout because of the rising cost of carbon emissions. The International Energy Agency has urged the Czech Republic to bring forward its exit from coal power to well before the current proposal of 2038. In Germany, an activist investor is arguing RWE would benefit massively from the early closure of its lignite plants. In Australia, the Minister for Energy in NSW, who is a member of the centre-right Liberal Party, has confirmed the state could phase out its fleet of coal plants by 2030. His national counterpart from the same party has been resisting growing domestic and international pressure for an orderly transition away from coal power.

There have been other significant moves in the last week. In the US, a bill promoted by House Democrats to accelerate the transition to clean energy has been approved by a key committee. In Illinois the legislature has passed legislation requiring the retirement of the state’s existing coal fleet by 2045. The federal bill, if passed, may accelerate the retirement schedule. There has been other good news too with an Australian court rejecting an appeal by the South Korean utility KEPCO over a proposed thermal coal mine.

Bob Burton


World’s coal-power pipeline has shrunk by three-quarters

The global pipeline of new coal plant projects has already shrunk dramatically since 2015, bringing the world closer to a pathway consistent with international climate goals, write Leo Roberts from E3G and Christine Shearer from Global Energy Monitor in Carbon Brief.

How coal turned from biggest asset to biggest risk for energy companies

Having cheap coal-fired generation in your electricity portfolio used to be one of the biggest competitive advantages for vertically integrated energy companies, but that is no longer the case, writes Marija Petkovic from the Australian energy consultancy, Energy Synapse.

New Adani mine project puts Indian villages at the coalface

In June 2021, Adani officials met with affected villagers and were told, in no uncertain terms, that the people would not give up their land for Adani’s proposed coal project near the quiet Indian village of Gondalpura in Jharkhand, writes Geoff Law in Adani Watch.


Australia court ends KEPCO bid to build Bylong coal project

The New South Wales Court of Appeal has dismissed an appeal by South Korean utility KEPCO against the decision of the New South Wales Land and Environment Court to reject the company’s proposed Bylong coal mine. In September 2019 the Independent Planning Commission (IPC) found the mine would have adverse impacts on groundwater, agricultural land and a range of scenic, heritage and natural values and that it was “rational” to reject fossil fuel projects that have higher impacts than alternative projects. KEPCO appealed the IPC decision in the Land and Environment Court but lost. It then sought to overturn that decision in the Court of Appeal. The decision was welcomed by the Bylong Valley Protection Alliance (BVPA) which called on the NSW Government to extinguish the coal licence, purchase the 13,000 hectares of agricultural land the company bought and allow farming to return to the area. The court ordered KEPCO to pay the BVPA’s legal costs. (Environmental Defenders Office, Lock the Gate Alliance, NSW Court of Appeal)

Illinois sets 2038 closure date for all but one coal plant

Legislation passed by the Illinois legislature and signed into law by Governor Pritzker requires the state to have a zero-emissions power sector by 2045. The legislation requires the state to invest US$580 million a year to increase Illinois’s clean energy from 9 per cent to 50 per cent by 2040, increase funding for community solar programs, expand energy efficiency programs with a priority on low-income households and extend labour standards in clean energy projects. The law also requires pollution upgrades at fossil fuel plants, with all but one of the state’s ten coal plants to close by 2038. Illinois currently has 33 coal units with a combined capacity of 9360 megawatts (MW). The 1776 MW Prairie State Energy Campus, which was commissioned in 2012 despite sustained community opposition, must retire by 2045. (NRDC)

Top News

Report finds new coal projects have slumped since Paris Agreement: A report by the UK-based NGO group E3G has found 1175 gigawatts (GW) of planned coal-fired power projects have been cancelled since the 2015 Paris Agreement was negotiated, a 76 per cent decline. Since 2015, 44 governments have committed to not build any further coal plants. The report states a further 40 countries do not have any coal projects in the pre-construction pipeline and “are in a position where they could readily commit to ‘no new coal’.” As of July 2021, six countries – China, India, Vietnam, Indonesia, Turkey, and Bangladesh – account for 82 per cent of the pre-construction pipeline of proposed coal plants. (RenewEconomy, E3G)

Proposed US clean energy bill to accelerate coal power phase- out: The US House of Representatives Energy and Commerce Committee has voted 30–27 to support the Democrats’ proposed Clean Electricity Performance Program. The bill, which proposes to run from 2023 to 2030, requires electricity utilities to supply four per cent more clean energy per year to customers. Utilities that meet the target will qualify for grants from the US$150 billion program to support clean electricity investment, assistance with bills and worker retention. Companies that fail to meet the clean energy growth target would be liable to pay US$40 per megawatt hour for the shortfall. America’s Power, a coal industry lobby group, complained the bill would eliminate coal power generation by 2030 if adopted by Congress. (Bloomberg, Utility Dive, NRDC)

NSW Minister says state’s coal plants could close by 2030: New South Wales Minister for Energy and Environment, Matt Kean, said the state could meet the United Nations call for the world’s richest countries to phase out coal power by 2030. NSW currently has five coal plants with a combined capacity of 10,625 MW. The 2000 MW Liddell is slated to close in 2023 and the 1320 MW Vales Point plant in 2029. Kean said the state government planned to add 12,000 MW of solar and wind capacity and 2000 MW of energy storage to the state grid. The 2000 MW Snowy pumped hydro stage 2 project, which is currently being built by the federal government-owned utility Snowy Hydro, will also provide storage capacity to the eastern states grid. NSW has Australia’s biggest fleet of coal plants but they are increasingly unreliable and struggling to compete with lower-cost renewables. (Guardian, RenewEconomy)

IEA urges Czech Republic to plan for a faster coal phase-out: The International Energy Agency (IEA) has advised the Czech Government that phasing out coal power before the 2038 deadline proposed by the coal commission “is conceivable purely based on economic considerations”. The IEA review stated the best prospect for additional capacity is with renewables and estimated there is potential for up to 7000 MW of solar capacity and 1600 MW of wind capacity by 2030. However, the review found the government’s current proposals for additional renewable capacity “appear to lack ambition” and urged the adoption of strategies to exploit renewables potential. (International Energy Agency)

Latest draft of Vietnam’s energy strategy increases coal, cuts renewables: In the latest draft of Vietnam’s proposed 2021–2030 energy strategy, the Ministry of Industry and Trade has proposed increasing coal capacity by 3070 MW to 40,649 MW or 31 per cent of installed capacity by 2030. The proposed plan cuts the country’s 2030 total installed capacity by 7688 MW to 130,371 MW, with renewables capacity cut by over 8000 MW. The plan, which is out for another round of public comment, proposes to slash 4190 MW of onshore and nearshore wind capacity and 2000 MW of offshore wind power. The draft also proposes cutting the share of generation from wind power from 8.1–10.3 per cent in the previous draft to just 5.6–6.5 per cent by 2030. (Lao Dong [Vietnamese])

Germany court rules eviction of Hambach forest protesters was illegal: A court has ruled the eviction of protesters blocking the clearing of the Hambach forest in 2018 was illegal as it was undertaken on the false “pretext” that treehouses built by activists “violated fire protection building regulations”. The court ruled the arrests and eviction of protesters was done “to suppress opponents of lignite”. The police operation was undertaken at the direction of North Rhine-Westphalia Premier, Armin Laschet, who is now the nominated candidate of the conservative parties to succeed Chancellor Angela Merkel at the September 26 election. (Clean Energy Wire, The Local)

NGOs press Bank of China to end support for international coal plants: A coalition of 35 NGOs has urged the Bank of China (BoC) to end its financing of international coal projects. The bank has provided over US$35 billion for coal plants since the Paris Agreement was adopted in late 2015. In a letter to BoC’s Chairman, Liu Liange, the NGOs warned the bank’s continuing support for coal plants is “out of step with China’s climate change ambition”. In August BoC’s President, Liu Jin, said the bank would “gradually reduce” the share of funding for coal projects between 2021 and 2025. (Reuters)

Coal plants still benefitting from Ohio nuclear bailout bill: The public controversy over the US$60 million campaign funded by FirstEnergy to bail out two nuclear plants with annual subsidies of about US$150 million resulted in the legislature repealing the subsidies in March 2021. However, the subsidies for two coal plants, one in Ohio and the other in Indiana, remain, with US$143.3 million paid by Ohio electricity consumers since January 2020. A bill sponsored by Ohio Senators Mark Romanchuk and Hearcel Craig proposes to repeal the coal plant subsidies as well. (Columbus Dispatch)


Australia: Canada’s Brookfield Infrastructure moves to increase its shareholding in Queensland’s Dalrymple Bay coal terminal to 60 per cent after selling off a 51 per cent stake in 2020.

Maecenas: sed ante pellentesque, posuere leo id, eleifend dolor.

New Zealand: Loss of a key customer and increasing environmental compliance costs force September 30 closure of Ohai coal mine in Southland.

Pakistan: Pakistan International Bulk Terminal plans to boost the capacity of its coal terminal at Port Qasim from 12 to 16 million tonnes.

US: US to propose – with support from Canada, the EU, South Korea, Norway, Switzerland and the UK – an OECD ban on export financing support for unabated coal power.

Companies + Markets

Report charts alternatives to coal in industrial uses of heat: A report for the World Business Council on Sustainable Development estimates the provision of process heat for industry accounted for 29 per cent of final energy use in 2018, with greenhouse gas emissions from the sector on a par with those from transport. The report estimates coal was used to produce 41 per cent of the energy used for industrial heat applications. Bloomberg New Energy Finance estimates China, France, Germany, Italy, South Korea and the UK are the most likely countries to deploy renewables based-industrial heat as they have electricity prices that are competitive with gas, existing providers of renewable heat solutions and favourable government policies such as a carbon price. (World Business Council on Sustainable Development)

Report says growth of Indonesian solar sector requires policy reforms: A report by the Institute for Essential Services Reform (IESR) says Indonesia could benefit from a significant increase in investment in solar capacity if the government reformed its power procurement process. The report says the current process requires renewables to compete against subsidised coal projects. IESR estimates Indonesia’s target of obtaining 23 per cent of its electricity from renewables by 2025 could be met with 18,000 MW of solar capacity at a cost of US$14.4 billion. However, Indonesia currently has only 154 MW of solar capacity. The report warns the government also needs to reconsider plans to add more coal plants to the grid as capacity payments are crippling the state-owned power utility, PLN, and only adding to the country’s over-capacity. (The Star, Institute for Essential Services Reform [Pdf])

Polish utilities seek price rises to offset rise in carbon costs: Poland’s Prime Minister Mateusz Morawiecki has sought to blame Europe for the price of a tonne of carbon in the European Union’s (EU) Emissions Trading System rising above €60 (US$71). The government-owned power utility, PGE, is reportedly seeking to increase domestic power prices by up to 40 per cent. PGE has spent almost €440 million (US$518 million) in the first quarter of 2021 to cover the cost of carbon dioxide permits, an increase of 22 per cent on the same period in 2020. The EU carbon price is now 12 times higher than it was four years ago. Lidia Wojtal from Agora Energiewende, a German climate policy think tank, said Polish utilities started investing in renewables last year but these decisions “should have been taken at least a decade ago”. (Politco)

Slovenia’s coal utility seeks bailout to offset carbon costs: HSE, the owner of the 945 MW Sostanj plant and the associated Velenje lignite mine, is reportedly seeking financial support from the Slovenian Government. The power plant reported a €280.4 million (US$330 million) loss in 2020 due to the rising EU carbon price. According to a local news website, HSE informed a Slovenian government agency that manages state assets that the remaining €650 million (US$767 million) value of the plant should be written off. (Balkan Green Energy News)

Activist investor urges RWE to accelerate coal retirement plans: Enkraft Capital, a minor shareholder in RWE, has urged the German utility to accelerate the closure of its lignite power plants and sell emissions rights it has stockpiled to cover the future cost of its carbon liabilities. Enkraft, which has the backing of a large German investment fund, Deka Investment, estimates RWE could realise a €10 to €13 billion (US$11.8 to US$15.4 billion) windfall from an accelerated exit from lignite. German legislation requires RWE’s last lignite plants to close by 2038 but the next government will be forced to bring the retirement dates forward to comply with a recent court order. (BloombergQuint)

China seeks to boost flow of Mongolian metallurgical coal: China’s Minister of Commerce, Wang Wentao, has raised the prospect of increased metallurgical coal imports with Mongolian Deputy Prime Minister, Amarsaikhan Sainbuyan. Mongolia has become China’s largest supplier of metallurgical coal after China banned imports from Australia, the world’s largest exporter of metallurgical coal. The ban has led to a spike in the price of metallurgical coal and left China struggling to find alternative suppliers. Mongolian coal exports, which heavily rely on truck transport across the border to Chinese railheads, have been repeatedly disrupted due to measures introduced to control COVID-19 outbreaks. Proposals for rail connections to major Mongolian mines have foundered for lack of finance. (The Star)

Canadian coal company mulls offloading coal division: Teck Resources, the world’s second largest exporter of metallurgical coal, is contemplating options for the disposal of its coal division to address investor concern over global heating. Teck Resources, a Canadian-headquartered company, operates four metallurgical coal mines in the Elk Valley in British Columbia, which have been dogged by controversy over water pollution. In 2020, Teck’s mines produced 21 million tonnes of metallurgical coal which accounted for 35 per cent of its gross profit. Teck is reportedly considering either selling the coal division off or spinning it off as a standalone company. Some major mining companies, such as Rio Tinto, have exited the coal sector entirely while others, such as South32, have sold off thermal coal projects but retained the more valuable metallurgical coal mines. The sale of its coal division would leave Teck with copper, zinc and oil sands operations. (Bloomberg)


Just Transition: Creating New Jobs for a Decarbonized Society, Kiko Network, September 2021.

This 12-page report collates examples of just transition strategies in a dozen countries and outlines the lessons for Japan as it faces growing international pressure to retire coal plants.

Solar Futures Study, US Department of Energy, September 2021. (Pdf) (The media release is here.)

This 310-page report estimates that solar could account for up to 45 per cent of US electricity supply by 2050 with supportive polices and aggressive price reductions. Coal generation would decline rapidly to zero by 2050.

“Why Corporate Credit Ratings Agencies Shy Away From Climate Risks: An Interview with Melissa Brown, IEEFA”, EnergyTracker Asia, September 14, 2021.

Melissa Brown from the Institute for Energy Economics and Financial Analysis explains why credit ratings agencies are struggling to account for climate risks in the ratings for companies with significant coal and other fossil fuel interests.