August 9, 2018
Issue 240  |  View Past Issues
CoalWire

Editor's Note

The good news of the week is the growing number of financial institutions, most notably Munich Re and Lloyds Banking Group, paring back their support for the coal industry. In the US, the Tennessee Valley Authority has flagged that it does not envisage the need for any major new plants other than renewables over the next 20 years. The US Energy Information Administration has revealed that coal consumption has plummeted by over one-third over the last decade. In Taiwan, the government is now grudgingly conceding that public opposition to a new coal plant has to be reckoned with.

The transition is far from smooth, though. The revelation in the latest CoalSwarm coal plant data that some previously suspended coal plants in China are now being built despite the existing massive overcapacity is alarming. Even if the plants eventually run at a reduced capacity, huge amounts of scarce capital will have been wasted to provide a short-term economic boost from building them.

Coal controversies keep on rolling along. In South Korea, the major public utility KEPCO is facing an investigation into whether it, among other importers, breached United Nations sanctions on coal imports from North Korea. In the US, a coal company has been revealed to have secretly been bankrolling opposition to a wind farm in Ohio. In Indonesia, the global cement company Holcim is facing calls to clean up a major coal spill in a bay in Aceh province. In the Philippines a Holcim subsidiary has acknowledged it spilled coal into the ocean from a cement plant storage area.

Bob Burton

Features

Germany bulldozes old villages for coal despite lower emissions goals

Hundreds of protestors have gathered at Podelwitz in a bid to block the demolition of an 800 year old village to cater for the expansion of a lignite mine, writes Esme Nicholson in NPR.

Despite chronic overcapacity, China is allowing new coal plants to proceed

Satellite imagery reveals that many coal-fired power projects that were halted by the Chinese government have quietly restarted despite the prospect of dramatically increasing overcapacity, writes Feng Hao in China Dialogue.

Calls for clean-up after coal spill pollutes Indonesian bay

Fisherfolk and environmentalists in Indonesia are calling for a clean-up after a barge destined for a Holcim cement plant spilled 7000 tonnes of coal onto Lampuuk Beach in Aceh, damaging coral and marine life, writes Junaidi Hanafiah in Mongabay.

Top News

Chinese province to axe 3100 MW of existing coal units: Guangdong province has released draft guidelines to curb air pollution. The guidelines propose closing 3100 megawatts (MW) of old polluting coal power capacity at four plants by the end of 2020. However, additional generating capacity will be allowed from either clean energy sources or new, less polluting coal plants. (Reuters, BJX.com [Google Translate])

Taiwan Government plan for new coal plant faces growing opposition: Taiwan’s Minister for Economic Affairs has pledged to “negotiate” with residents “before going ahead with the plan” for a new 1200 MW Shenao plant. However, local media reported that the Presidential Office had responded to strong public criticism of the project and suggested Cabinet consider dropping the proposed plant. The government has proposed the construction of a new coal port and dismissed suggestions of potential impact on marine life. However, a team of divers recently discovered a large coral reef near the proposed port which would be damaged by dredging for the coal terminal. (Focus Taiwan, Taipei Times)

Coal company revealed as funder behind opposition to Ohio wind farm: Court documents have revealed that Murray Energy secretly funded the cost of an economic consultant and lawyers for two residents who testified against the proposed 20.7 MW Icebreaker Wind project in Lake Erie, Ohio. The wind project has support from environmental and business groups as well as the Ohio state government. The founder of Murray Energy, Robert Murray, has lobbied President Donald Trump on energy policy, in particular for the federal government to intervene in the electricity market to supporting failing coal plants. (Cleveland.com)

South Korea Customs investigates possible North Korean coal shipments: Korea Customs Service is investigating up to nine shipments of coal that could have originated from North Korea in breach of United National sanctions instituted in August 2017. Two of the shipments of coal, imported from Russia but believed to have originated in North Korea, were for a subsidiary of the publicly owned utility KEPCO. KEPCO insist the proof of origin documentation stated the shipments were Russian coal. However, if the utility is found in violation of the sanctions it could be added to the US blacklist. Despite the controversy, Hyundai Merchant Marine is seeking to restart the export terminal in Rajin in North Korea which was established to supply Russian coal to South Korea. (KBS Radio, Chosun, Fairplay)

Philippines cement plant spilled 40 tonnes of coal into ocean: Holcim Philippines, the Philippines subsidiary of the global cement company Holcim, has acknowledged that an estimated 40 tonnes of coal at its Bacnotan cement plant in La Union province washed into the ocean in a storm. The company has announced it will move its open coal stockpile to an enclosed storage area. Just days before the storm civil society groups held Break Free from Coal parades in nearby San Juan and San Fernando City. (Inquirer, Manila Times)

UK court dismisses charges against mine blockaders: Charges have been dismissed against eight demonstrators who protested against the construction of the Banks Group’s Bradley coal mine in Pont Valley. District Judge Helen Cousins found that the discovery of a rare Great Crested Newt two days before the protestors were arrested may have been seen as “too convenient” by the mining company but it should have investigated further. Cousins found that she couldn’t “be satisfied that Banks would not have committed or be about to commit an offence contrary to the Habitat and Species Regulations.” The site has now been cleared. (Northern Echo, BBC)

News

Bulgaria: A coalition of NGOs has filed a legal challenge against approval for Brikel lignite plant to also burn petrochemicals and other waste without environmental assessment.

India: Anti-corruption agency seeks tougher prison sentence for former Jharkhand chief minister Madhu Koda over the allocation of Rajhara North coal block.

India: Coal port stockpiles climb as increased imports overwhelm railway capacity.

Indonesia: Sofyan Basir, President Director of public utility PLN, questioned over Riau 1 coal plant scandal.

Myanmar: Three residents arrested over protest against coal-fired cement plant in Mandalay Region.

Pakistan: The depreciation of the rupee is increasing financial pressure on industries reliant on imported coal.

UK: High Court to hear Banks Mining challenge against rejection of its proposed Druridge Bay mine.

US: PacifiCorp wins temporary court order blocking Oregon regulator from releasing specific coal plant cost analysis.

Companies + Markets

Munich Re concedes a little ground on its coal policy: In response to growing pressure from investors and civil society groups, Munich Re, the world’s largest reinsurer, has announced it will cease investing in bonds and shares of companies that generate more than 30 percent of their sales from coal-related business. Munich Re said that “in principle” the company would “no longer insure new coal-fired power plants or mines in industrial countries.” This limitation applies to a small number of proposed coal plants, though the impact on new coal mines is less clear. The company’s announcement followed 850,000 people signing a petition urging the company to exclude coal. In early May, Allianz announced it would not provide stand-alone insurance for new coal plants or mines and would withdraw entirely from the coal sector by 2040. (Euronews, Unfriend Coal)

Lloyds unveils decarbonisation plan: Lloyds Banking Group has announced it will cease financing new coal-fired power stations or thermal coal mines, including any major expansion of existing plants. It also announced it will not take on as new clients companies that earn a majority of their revenue from coal-related business but will work with existing clients to “support their transition to lower carbon models in line with the Paris Agreement.” The bank also announced it will exclude financing mountaintop coal mining projects for new or existing clients. (Reuters, Lloyds Banking Group)

US coal production plummets: The US Energy Information Administration (EIA) estimates that in 2017 US power sector coal consumption was 36 per cent lower than in 2008 when US coal production reached its highest level. The decline is equal to 376 million US short tons or 247 million metric tonnes. The EIA estimates that 2017 was the fourth consecutive year that US coal consumption and coal shipments declined. (US Energy Information Administration)

US utility predicts no need for new large plants for 20 years: Bill Johnson, the President and CEO of the Tennessee Valley Authority (TVA), a federal US government-owned utility which operates six coal plants, has flagged that the agency’s revised 20-year plan is once more likely to conclude that no new conventional generation capacity will be required in the next 20 years. Johnson also said that “the decline in demand is real and, I think, permanent” due to energy efficiency gains. The decline in demand, he said, has resulted in reduced capital expenditure and declining debt levels. Public comments submitted on its 2019 plan included many from supporters of the 440 MW Red Hills coal plant and coal mine in Ackerman, Mississippi urging the TVA to continue power purchases from the plant. (SNL)

Indonesian Government stands firm on domestic coal price cap: Indonesia’s President Joko Widodo has rejected lobbying to abandon the domestic market obligations (DMO) for coal producers. The DMO requires coal producers to provide at least one-quarter of production for the domestic market. The DMO regulation also caps the sale price of thermal coal to the government-owned utility PLN at a maximum of US$70 per tonne. While the price cap eases pressure on PLN to increase electricity prices ahead of the April 2019 Presidential election, coal exporters wanted the DMO price set higher as the export price is currently far higher. (Platts)

Indian Government gives green light to coal seam and shale gas: The Indian Government has granted approval for the holders of existing oil and gas licences to explore or produce shale oil and coal bed methane within their licence areas. Previously oil and gas companies could not exploit shale oil or coal seam gas deposits in their licence areas. The change in the regulations expands unconventional gas and oil projects over 77,296 square kilometres. (Times of India)

Uniper unveils coal plant conversion plan: The European utility Uniper plans to build new gas-fired units to replace the two remaining coal units at its 700 MW Scholven coal plant in North Rhine-Westphalia. The gas units are intended to initially supplement the coal units but fully replace them by 2022 with the power supplied to a nearby industrial customer. The two units to be closed were commissioned by the early 1970s. In its report to investors Uniper did not mention its proposed 1100 MW Datteln 4 coal plant which it stated in May would be delayed until 2020. (Platts, CoalSwarm)