February 14, 2019
Issue 263  |  View Past Issues

Editor's Note

The setbacks for the coal industry keep on coming. In Australia, a court rejected a coal company’s appeal against a proposed mine in part because of its adverse impact on the global climate. In a similar vein a US magistrate has recommended a US Government agency reconsider the climate impacts of allowing a coal mine expansion. In the UK, the 2000 megawatt (MW) Cottam coal plant is set to close later this year. In Spain, the Balearic Islands Government has negotiated an agreement to close two coal units next year and will phase out the two other units by 2025. In Indonesia, a member of the campaign of the leading challenger to President Joko Widodo has flagged the need to cut plans for a fleet of new coal plants. A UN committee has urged the Japanese Government to “rethink” its support for overseas coal plants. In Germany, a utility facing a takeover bid is hoping to defy the odds and be allowed to complete the construction of a 1100 MW coal plant despite the coal exit commission’s recommended phase-out.

Nowhere is the coal industry’s mantra of ‘cheap, reliable, baseload’ looking more ridiculous at the moment than in South Africa. Eskom’s board has acknowledged that the two huge new coal plants, Medupi and Kusile, are unreliable and a significant factor behind the widespread blackouts gripping the country. In the US, President Donald Trump is lobbying the Tennessee Valley Authority to keep operating an old part-time coal unit that is barely economic. In Greece, the tender process to privatise two lignite plants has failed after the bids fell well below independent valuations the utility commissioned.

Bob Burton


The end of coal in Germany could come much quicker than you think

With the end date for coal power in Germany set for 2038 at the latest, the rundown of plants will occur far faster than most expect, writes Nick Butler in the Financial Times.

Coal miners derided climate action 'sideshow'. Now it's the main event

The decision of the Chief Judge of the New South Wales (NSW) Land and Environment Court to reject the proposed Rocky Hill metallurgical coal mine effectively resets the default decision for any new fossil fuel project to “no” because of climate change, write David Morris and Brendan Dobbie from the New South Wales Environmental Defenders Office.

New coal plants in Belt and Road countries would be toxic for China’s reputation

Unless President Xi ensures Belt and Road projects are “green”, “low-carbon” developments as originally promised, subsidies for new coal plants in countries such as Pakistan will be toxic for the environment and China’s reputation, writes Simon Nicholas in the South China Morning Post.


Australian court rejects proposed Rocky Hill mine on climate change grounds

The Chief Judge of the NSW Land and Environment Court has dismissed Gloucester Resources’ appeal against the Department of Planning’s rejection of the proposed Rocky Hill coal mine in New South Wales. The court found that the impacts of the proposed metallurgical coal mine on the local community, Aboriginal culture, the scenic quality of the Gloucester Valley and its contribution to climate change meant the costs outweighed the benefits. The judge decided the mine should be rejected as it “would be in the wrong place at the wrong time.” (Sydney Morning Herald, Guardian, NSW Land and Environment Court)

UK coal plant to close

UK utility EDF Energy has announced that the 2000 MW Cottam coal plant will close at the end of September 2019. EDF Energy stated that the plant, which was first commissioned in 1969–70, “will not be economically viable” after the end of September. The plant had failed to win capacity payments from the UK Government and faced significant investments to meet European Union pollution standards. EDF Energy also owns the nearby 2000 MW Burton plant, which is guaranteed capacity payments on three of its four units until the end of September 2021. The company said it intends to honour those agreements but will review the future of the plant beyond then. While the Department for Business, Energy and Industrial Strategy announced last year that legislation would be introduced setting a 2025 end date for coal power, a bill has not yet been tabled. (Guardian, ClientEarth, EDF Energy)

Top News

Campaign of Indonesian presidential contender urges cut to coal plans: A Member of Parliament from the Gerinda Party, Ramson Siagian, said his party will review all contracts in the country’s 35,000 MW new power plan. When the plan was first mooted, about 19,000 MW of new coal capacity was proposed. Ramson said that the Gerinda Party’s presidential candidate, Prabowo Subianto, had stated that Indonesia should reduce its use of coal power, increase renewables and overhaul the plan for the construction of 35,000 MW of new power plants. Prabowo is the main rival to President Joko Widodo in the April election. (Jakarta Post)

Spanish islands set coal plant phase-out schedule: Spain’s Ministry for the Ecological Transition, the regional government of the Balearic Islands and Endesa have agreed to close the 575 MW Alcudia coal plant by 2025. Under the agreement, the first two 130 MW units will close by January 1, 2020. The remaining two 125 MW coal units will have their operating hours capped at 1500 hours a year until August 2021 and then 500 hours a year afterwards and, in line with a new Balearic Islands law, be closed by 2025. (IIDMA, IIDMA)

Judge recommends that US agency reconsider climate impacts in coal mine decision: US Magistrate Judge Timothy Cavan has recommended that the Department of Interior re-assess the proposed expansion of Cloud Peak Energy’s Spring Creek Mine in Montana. The agency’s original decision to approve the mine expansion has been appealed by WildEarth Guardians and the Montana Environmental Information Center. Cavan agreed with the two groups that the department had “failed to take a hard look at greenhouse gas emissions” but stopped short of ordering a freeze on the mining operations while the re-assessment is undertaken. US District Judge Susan Watters has yet to review Cavan’s recommendation. (Associated Press, Western Environmental Law Center)

UN committee urges Japan to cut emissions and support for new coal projects: A committee reviewing Japan’s compliance with the United Nations Convention on the Rights of the Child has urged the government to “reconsider” its financial support for new coal plants “in other countries” and to cut its domestic greenhouse gas emissions in line with its international commitments. (Kiko Network)

China’s air pollution worsens in northern cities: Chinese Government data has revealed that PM2.5 air pollution in 39 major northern cities increased by 16 per cent to 114 micrograms per cubic meter in January compared to the same month in 2018. The World Health Organization standard for PM2.5 pollution is 10 micrograms per cubic meter while China’s official standard is 35 micrograms per cubic meter. Many of the cities won’t be able to reach their target of reducing fine particle air pollution by three per cent over the October to March period compared to the year before. Air pollution in China peaks in winter as a result of increased coal use and generation for domestic home heating along with normal industrial demand. (Reuters)

Adani closer to mining Indian forest: Indian billionaire Gautam Adani’s Adani Enterprises Limited has been granted preliminary forest clearance to establish the proposed Parsa coal mine within the 170,000 hectare Hasdeo Arand forest in Chhattisgarh that was once proposed as a ‘no go’ area to mining. A committee of the Ministry of Forests, Environment and Climate Change requested Chhattisgarh State Government investigate whether there was any “dense forest” in the proposed mining area and, if so, suggested it should be excluded. However, Chhattisgarh Bachao Andolan said the area is all dense forest and an important elephant habitat while the rights of the resident tribal communities had still not been finalised. The Centre for Policy Research warned that studies recommended by a 2014 National Green Tribunal decision had still not been undertaken. (Hindustan Times)

“The GHG [greenhouse gas] emissions of the coal mine and its coal product will increase global total concentrations of GHGs at a time when what is now urgently needed, in order to meet generally agreed climate targets, is a rapid and deep decrease in GHG emissions. These dire consequences should be avoided. The project should be refused,”

wrote Brian Preston, the Chief Judge of the New South Wales Land and Environment Court in rejecting the proposed Rocky Hill mine.


Australia: Adani coal terminal released polluted water into Caley Valley wetlands after downpour.

Botswana: Talks resume with Transnet over proposed coal railway to South Africa and export market via Richard Bay coal terminal.

India: Villagers launch legal challenge against land acquisition in Jharkhand for Adani’s 1600 MW Godda coal plant.

South Africa: Court orders government agencies to hand over documents on proposed Thabametsi and Khanyisa coal plants.

Zimbabwe: Parliamentary committee to investigate allegation that MP sought a US$400,000 “facilitation fee” from potential Hwange colliery contractor.

“They [the Medupi and Kusile coal plants] are probably the single largest disaster in South Africa’s economic history,”

writes Rod Crompton, Adjunct Professor at the Wits Business School's African Energy Leadership Centre.

Companies + Markets

Fate of new German coal plant up in the air: While the German coal exit commission recommended that agreements needed to be reached on new coal plants not yet commissioned, Uniper is pushing for the not yet completed 1100 MW Datteln 4 to be the last coal plant to close claiming it would be “best for grid stability and the environment”. However, civil society groups argue that the hard coal plant, which has been strongly resisted since it was proposed over a decade ago, should not be commissioned. The coal exit commission proposed the initial focus of plant closures should be in western Germany, where the Datteln plant is located, to limit the social and economic impacts on the poorer eastern states. It also proposed the plant be considered for compensation payments. Uniper is currently facing a likely takeover bid by the Finnish utility Fortum Oyj, and the life of the plant and the amount of compensation will affect the company’s valuation. (Clean Energy Wire, Bloomberg)

Analysts urge Germany to cancel carbon emission allocation as plants close: NGOs and carbon market analysts are urging Germany to adopt a policy of voluntarily cancelling emission allocations as coal plants are closed when  implementing the coal exit commission recommendations. The commission recommended that 12,700 MW of coal plants close by 2022 in the first phase of the coal exit plan. However, if Germany doesn’t cancel the carbon emissions allocations for the plants analysts fear a market glut will cause the carbon price to slump and undermine the transition away from coal in other European Union countries. (Argus Media)

Privatisation of Greek coal plants fails with low bids: Public Power Corporation’s (PPC) attempt to privatise the two lignite plants at Meliti and Megalopolit has collapsed after tender offers from two consortiums were rejected by the utility’s board. Mytilineos SA offered PPC €25 million (US$28.2 million) for the 330 MW Meliti plant, well short of the independent valuation of €153 million (US$173 million). A second 450 MW unit has been proposed at the plant. Mytilineos SA also offered €147 million (US$166 million) for the 600 MW Megalopoli plant. The European Union is pressing the Greek Government for the privatisation of the plants with PPC looking to rework its tender in the hope of attracting better offers. Civil society groups want the Greek Government to abandon negotiations to include the plants in a capacity payments scheme and instead retire the plants and replace them with clean energy. (Ekathimerini, Reuters, WWF)

South African blackouts as new coal plants fail: In the wake of widespread blackouts following the failure of numerous coal units, the board of Eskom has instituted an “urgent review” of the 4764 MW Medupi and 4800 MW Kusile coal plants. The review will include “the extent of design and other operational faults, what steps can be implemented to minimise the ever-escalating costs and what can be done to increase output.” The Eskom board stated the two plants “are continuing to show a lack of reliability to contribute meaningfully to Eskom’s generating capacity.” The Minister for Public Enterprises, Pravin Gordhan, told a parliamentary committee that the plants are “badly designed and badly constructed.” The week before the blackouts, President Cyril Ramaphosa announced the utility will be split into three units: generation, transmission and retail. The restructuring, which has been proposed before but never implemented, is supported by Eskom but opposed by unions which anticipate significant job losses. (Eskom, Bloomberg, Bloomberg)

Trump voices support for ailing TVA plant: US President Donald Trump has urged the Tennessee Valley Authority (TVA) not to proceed with its plan to close the 1117 MW Unit 3 at the Paradise Fossil Plant in Kentucky. A TVA review of the unit, which commissioned in 1970, found that in 2017 it was generating power just 25.7% of the time with the prevailing power price barely covering its operating costs. The main coal supply for the plant is from a mine owned by Murray Energy, the private coal company owned by Bob Murray, a Trump campaign donor and proponent of bailouts for the coal and nuclear power industry. Later this week the TVA board is set to consider the proposed closure of Unit 3 at the Paradise plant and the loss-making 872 MW unit at the Bull Run plant in Tennessee. (Inside Climate News, Tennessee Valley Authority)