July 18, 2019
Issue 283  |  View Past Issues

Editor's Note

Wherever one looks the signs of the decline of coal power abound. A major party in Poland’s opposition coalition has put air pollution control at the centre of its platform by vowing to end coal burning for home heating by 2030 and for power generation by 2040. In Egypt, slowing demand has led to burgeoning overcapacity, leading the government utility to defer signing a contract for a 2640 megawatt (MW) coal plant with uncertainty surrounding another.

In Greece, the government’s plan to sell off two of its lignite plants and the rights to a new unit has fallen flat with no companies submitting bids. BHP, a major global exporter, is reportedly assessing selling off its thermal coal mines in Colombia and Australia as demand for its product falls. In Europe, coal imports for use within European Union countries have fallen to a 22-year low.

Nor has there been any let-up in scandals involving coal companies and power utilities. In Indonesia, a review of mining titles by the Corruption Eradication Commission (KPK) has led to the cancellation of permits for three coal mines in Kalimantan province. Civil society groups are also calling on the KPK to investigate the role of China Huadian Engineering in the scandal over the Riau-1 coal plant. In South Africa, Eskom has admitted that it has been operating units at its Kendal power station even though their pollution control equipment broke down over a year ago. In Australia, Adani faces prosecution for providing misleading information to the regulator on land clearing at its proposed mine site.

Bob Burton

Top News

Polish opposition vows to end coal by 2040: Grzegorz Schetyna, the leader of Civic Platform, a major opposition group in the European Coalition, has vowed that if the coalition is elected it will end the burning of coal for home heating by 2030 and coal power by 2040. While the ruling Law and Justice party has promised to reduce coal power’s share of generation, it supports the construction of new lignite plants and the phasing out of most existing onshore wind generation. The European Environmental Agency estimates that air pollution causes about 50,000 premature deaths a year in Poland with coal burning a big factor. Poland’s national elections are likely to be held in October or November 2019. (AFP, Reuters)

Three Indonesian coal mines canned after anti-corruption commission finding: Indonesia’s Ministry of Energy and Mineral Resources has terminated permits for three coal mines in East Kalimantan operated by PT Tanito Harum. Indonesia’s Corruption Eradication Commission found that a 20-year extension granted to the company in January 2019 was not consistent with the national law on coal mining. (Jakarta Post)

Indonesian NGOs call for scrutiny of China Huadian: Environmentalists and anti-corruption advocates have called on Indonesia’s Corruption Eradication Commission (KPK) to investigate the role of China Huadian Engineering in the now-suspended 600 MW Riau-1 power plant in Sumatra. KPK recently charged Sofyan Basir, the head of Indonesia’s power utility PLN, over his role in the proposed project in which he arranged meetings between PLN’s board and two politicians and a businessman who have subsequently been sentenced to prison after convictions on corruption charges. China Huadian Engineering is a partner in the project with the mining company Blackgold Natural Resources. (China Dialogue)

Indonesia’s president signals a transition away from coal power: Indonesia’s Minister for Environment and Forestry, Siti Nurbaya Bakarminister, recently recounted that at the July 8 Cabinet meeting President Joko Widodo emphasised that he wanted to “start reducing the use of coal.” While the relayed comment has been welcomed by civil society groups, Indonesia’s power development plan currently proposes increasing renewable capacity but also a rapidly increasing share of generation from coal. Widodo was re-elected in April to serve as President until 2024. During the election campaign the country’s growing air pollution crisis and climate crisis garnered relatively little attention from the Presidential candidates. (Mongabay)

Eskom’s largest coal plant runs despite pollution control breakdown: The publicly owned utility Eskom has admitted that its 4116 MW Kendal power station in Mpumalanga province has been operating since early 2018 despite the failure of its air pollution control equipment. Eskom admitted that the plant is “currently operating with very high particulate emissions” due to “significant” damage to the electrostatic precipitators and dust control systems on two of the plant’s six 686 MW units. The Centre for Environmental Rights said Eskom’s delay in complying with pollution controls is unacceptable. (Business Day)

Adani demanded names of scientists reviewing Australian mine plan: Adani Australia demands that CSIRO and Geoscience Australia, two government science agencies, provide the names of each individual involved in reviewing the proposed water management plan for the company’s proposed Carmichael coal mine. The agencies refused the request stating that the comments provided by the agencies on the water management plan reflected the views of the agencies not individual officers. Earlier this year a leaked legal strategy proposed by Adani’s legal firm, AJ & Co, included a section titled “Play the Man” which suggested that Adani “look for evidence of bias” in decision makers. In a separate development, Adani Australia is being prosecuted for providing misleading information to the Queensland Department of Environment and Science over land clearing at its Carmichael mine site. (ABC News, ABC News)

“Dirty energy is supported by dirty politics in Indonesia. You can generate profit easily if you are close with policymakers, or if you are a policymaker yourself,”

said Tata Mustasya from Greenpeace Southeast Asia.


Australia: Federal Court rejects appeal by five Wangan and Jagalingou members against Adani Indigenous Land Use Agreement.

Canada: Federal government sells 90 per cent of the Ridley coal terminal at Prince Rupert to Riverstone Holdings and AMCI Group with 10 per cent for two First Nations groups.

India: Delhi government to finally close 135 MW Rajghat coal plant and replace it with a solar park.

Mozambique: Vale announces one week for public consultation on plan to expand its Moatize coal mine.

Russia: Siberian Generating Company warns that a lake popular with Instagrammers is a toxic coal ash dam.

South Africa: Atha Africa Ventures latest bid to appeal the High Court’s decision setting aside approval for a new coal mine in the Mabola Protected Environment has been dismissed.

South Korea: Three smugglers of North Korean coal in breach of sanctions sentenced to suspended prison terms.

Thailand: Electricity Generating Authority of Thailand to hold public meetings after agreeing to rebuild two lignite-fired units at the Mae Moh plant.

UK: Numerous coal-free generation runs in Great Britain as coal power fades.

US: Utilities plan to keep closing coal plants despite Trump administration’s weakening of Obama’s Clean Power Plan.

Companies + Markets

Egyptian coal plants stalled as demand growth slows: Slowing demand growth has promoted the Egyptian Electricity Holding Company to delay the signing of contracts for the construction of the proposed 2640 MW Ayoun Moussa coal plant. Officials said that a large and growing power generating reserve margin combined with the costs associated with a new port for the project made deferral necessary. A public hearing on the Chinese-backed proposal for the 6600 MW Hamrawein coal plant has also been deferred with a new date not yet set. (Daily News Egypt, Global Energy Monitor)

Financing deadline for proposed Pakistan coal plant deferred: The Private Power Infrastructure Board has deferred the deadline for finalising financial support for the proposed 330 MW ThalNova Power plant until March 2021. The plant, which is one of the 3360 MW of new lignite plants proposed in the Thar Desert, was originally proposed to be commissioned in December 2021. In April 2019, ThalNova Power signed a loan agreement with China Development Bank and three other banks for the project. (UrduPoint, Global Energy Monitor)

European Union coal burn plummets as carbon prices climb: Declining coal demand in France, Italy, Poland, UK and Germany has resulted in the net coal imports into the 28 countries in the European Union (EU) declining to the lowest level in since August 2002. Declining demand has had a knock-on effect on coal exporters from Russia, Colombia and the US. One of the factors undermining coal demand is the rising cost of carbon emissions. A survey of eight analysts suggested the cost of EU Allowances would average €26.40 a tonne in 2019 but may rise to €34.37 a tonne in 2020. (Argus Media, Reuters)

No bidders emerge for Greek lignite plants: The Public Power Corporation (PPC), Greece’s publicly owned electricity utility, failed to attract any bidders for the proposed sale of its 330 MW Meliti and 600 MW Megalopoli lignite plants despite setting no minimum price and extending the deadline for bids. PPC was also offering the rights to a proposed 450 MW unit at the Meliti plant. The newly elected conservative government plans to announce a new plan for PPC that some analysts say may involve selling hydro plants along with the lignite units. The collapse of the latest sale process comes at the same time as uncertainty whether the 660 MW Ptolemaida V lignite plant, which is under construction, will ever operate after failing to gain subsidies under a capacity market mechanism ahead of the European Union’s Electricity Market Regulation coming into effect on July 3. (Reuters, WWF, ClientEarth)

BHP signals it is considering exiting thermal coal: The global mining company BHP has flagged that it is “exploring options for its thermal coal business including a disposal amid a growing investor focus on environmental, social, and governance issues.” BHP owns the Mt Arthur thermal coal mine in the New South Wales Hunter Valley and a one-third share of the Cerrejon mine in Colombia. The two mines produced 27 million tonnes of thermal coal in 2018–19. The mines are low-cost producers and considered very profitable, even in a declining market. In its latest report to shareholders BHP estimates thermal coal production in 2019–20 at between 24 and 27 million tonnes. (Financial Times, Australian Financial Review [paywall], BHP)

Adani Australia racks up big losses as Carmichael mine contractors under pressure: Adani Australia has recorded a loss of A$273 million (US$192 million) in part due to a A$128 million (US$90 million) impairment on its proposed Carmichael coal mine. The company attributed the impairment to legal challenges, delays in approvals and the need to redesign elements of the mine. The company also revealed it had made a A$132 million (US$93 million) loss on foreign exchange transactions but provided no details on how this occurred. The global engineering company GHD has declined to comment on suggestions that it has agreed to work on Adani’s proposed Carmichael project, prompting NGOs to step up lobbying pressure on the company. (Sydney Morning Herald, Market Forces)

Chinese data indicates government stimulus boosting coal: China’s latest economic data reveals that in the first half of 2019 coal power generation grew by just 0.2 per cent. Total electricity generation increased by 3.3 per cent over the same period. Solar and wind generation in the first six months grew by 11.2 per cent and 6.6 per cent, respectively. Domestic coal production in the first six months of 2019 was 1.76 billion tonnes which was an increase of 2.6 per cent on the same period in 2018. Coal imports rose by 5.8 per cent in the first half of 2019. Coal demand is remaining high in part due to strong demand growth in both the steel and cement sectors, which reflects government economic stimulus programs increasing infrastructure spending. (Reuters, Tom Baxter (China Dialogue)


The Risk of Fiscal Collapse in Coal-Reliant Communities, Brookings Institution and Columbia University’s Center on Global Energy Policy, July 2019. (Pdf) (Html version is here.)

This 56-page report examines three counties in Wyoming, North Dakota and West Virginia and the potential risks to the finances of these and other coal-dependent communities from a decline in coal production.