Why President Xi’s coal pledge is a big deal
President Xi Jinping’s announcement China will no longer support new coal plants will make countries such as Indonesia, Vietnam, Pakistan, Zimbabwe, and Turkey rethink their power development plans, writes Lauri Myllyvirta from the Centre for Research on Energy and Clean Air.
What does a new prime minister mean for Japan’s energy future?
The contenders to replace Japanese Prime Minister Yoshihide Suga will play a critical role in shaping Japan's energy future, writes Jacqueline Yujia Tao in Transition Zero.
Power shift: The Latrobe Valley looks for a new future, again
Early transition planning could soften the blow of the economic restructuring that will come from the inevitable closure of the three brown coal plants and associated mines in Victoria’s Latrobe Valley, writes Miki Perkins in The Age.
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Romania confirms 2032 coal power end date
The Romanian Government’s National Resilience and Recovery Plan submitted to the European Commission has confirmed the country will phase out coal and lignite power generation by 2032. Romania currently has nine operating coal plants with a combined capacity of 4675 megawatts (MW) with most burning lignite. Under the plan, three-quarters of current coal capacity will be closed by 2025 leaving just 850 MW online until 2032. In late May a leaked government economic recovery strategy proposed phasing out domestic coal mines and power plants to help decarbonise the economy and setting a target of sourcing 34 per cent of electricity from renewables by 2030. Romania’s commitment has been cautiously welcomed by Europe Beyond Coal and other NGOs which are hopeful the final retirement will be brought forward to 2030 or earlier once a clean energy transition is underway. (Europe Beyond Coal)
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Colombia’s new power plan excludes new coal plants: A revised 2020–34 generation and transmission expansion plan by Colombia's Mining and Energy Planning Unit (UPME) rules out the further expansion of coal power generation and instead relies on major growth of solar, wind and hydro generation. The 10 generation scenarios considered assumed the country’s five coal plants with a combined capacity of 1623 MW would remain unchanged. The new power plans casts a shadow over two proposed coal plants – the 465 MW Termobijao power station and the 1125 MW La Luna plant – which have been permitted but construction has not yet commenced. (BNAmericas)
Global coalition launched to build support for end to coal plants: A coalition of national governments – Sri Lanka, Chile, Denmark, France, Germany, Montenegro and the UK – have launched the No New Coal Power Compact, which requires supporters to cease permitting of new coal power plants and end new construction of unabated coal plants by the end of 2021. Signatory countries are aiming to enlist other countries to sign on to the compact ahead of the COP26 climate negotiations in Glasgow in November. Malaysia, which currently has five coal plants with a combined capacity of 13,424 MW, has announced it will not build any new coal plants. Prime Minister Ismail Sabri Yaako said Malaysia will build several gas plants to replace existing coal plants. (SeeForAll, The Star)
Enel brings coal retirement forward from 2030 to 2027: The Italian-headquartered utility Enel has announced it will accelerate the retirement of its coal fleet by bringing the end date forward from 2030 to 2027. In its recent half-yearly report, Enel stated it had 8904 MW of coal capacity with 5594 MW of that in Italy, 2764 MW in Spain and Portugal and the remainder in Colombia and Chile. In mid-2020 Enel’s head of power generation, Antonio Cammisecra, said the company would be out of coal generation in Italy by 2025 and “mostly” elsewhere too. In the last year Enel has announced the closure of its 660 MW Brindisi plant in Italy, gained approval for the closure of two plants in Spain and the early retirement of one in Chile. (Enel)
Hong Kong power utility announces coal power phase out by 2040: The Hong Kong headquartered CLP Group has announced it will phase out its fleet of coal power plants by 2040, “a decade earlier than previously pledged”. CLP’s Australian subsidiary, EnergyAustralia, owns the 1430 MW Mt Piper power station in New South Wales and the 1480 MW Yallourn plant and associated brown coal mine in Victoria. CLP subsidiaries also have stakes in a fleet of nine coal plants in China, one in India and another in Taiwan with the company’s share of capacity amounting to 9116 MW. In its report for the first half of 2021 the company said high coal prices had resulted in its Chinese coal plants reporting a loss while it has also made a A$65 million (US$47 million) provision for studies and potential remediation works after flood damage to a river diversion embankment at its Yallourn plant threatened the operation of the mine. (Nikkei Asia, CLP [Pdf], CLP Group [Pdf])
Chinese province blocks expansion of coal power: The Guangdong Development and Reform Commission, the development regulator for the industrialised Guangdong province, will not allow the expansion of existing coal plants or the construction of new ones. The ban also applies to captive power stations for major industrial sites. In August the National Development and Reform Commission identified Guangdong as one of 10 provinces that had not met national energy consumption and carbon emissions control targets. According to the Global Coal Plant Tracker Guangdong province has 65,866 MW of operating coal capacity with another 7120 MW under construction. A further 6020 MW is in various pre-construction phases. (S&P Global)
World Health Organization tightens air pollution guidelines: The World Health Organization’s (WHO) new Global Air Quality Guidelines has cut the recommended standard for PM2.5 fine particle pollution from 10 micrograms per cubic meter (μg/m3) to 5 µg/m3. It also slashed the recommended nitrogen dioxide level by 75 per cent from 40 µg/m3 to 10 µg/m3. The WHO estimates up to 80 per cent of the deaths caused by PM2.5 fine particle pollution could be avoided if the new standard is implemented. Estimates of the annual death toll from PM2.5 pollution are between 3 million and 8 million deaths per year. The WHO’s air pollution guidelines were last updated in 2005. (Guardian, Centre for Research on Energy and Clean Air, World Health Organization)
Indian Government aims to auction shunned coal blocks: India’s Ministry of Coal has called for fresh bids on 11 coal blocks despite having received only one bid on each of them in the last auction held in August. Under the terms of the last auction only blocks that received two or more bids could be sold. The blocks on offer include three in each of Odisha and Jharkhand, two in each of Chhattisgarh and Madhya Pradesh and one in Maharashtra. Six of the blocks have been fully explored and are estimated to have just over 1 billion tonnes of total coal resource and the other blocks are only partially explored. The Burapahar mine in Odisha accounts for over half the total resource of the explored blocks. The Ministry is seeking bids by November 29, 2021 and aims to finalise the auction by late January 2022. (Financial Express, Ministry of Coal [Pdf])
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Australia: Environment Victoria seeks judicial review of Environment Protection Authority’s failure to regulate greenhouse gas emissions of the state’s three brown coal power stations.
Australia: Mining baron Clive Palmer seeks council approval, without a formal public comment period, of a proposed 1400 MW coal power station in central Queensland.
Australia: Proxy adviser CGI Glass urges shareholders vote against BHP’s climate report stating it is “unclear” whether the targets for reducing the emissions of coal customers “are science-based”.
Europe: Europe’s carbon price exceeds €65 (US$76) per tonne as gas shortage drives increased coal generation.
Germany: Climate policy at heart of minority government negotiations after Social Democratic Party emerges as party with the most seats.
India: In a bid to cut air pollution the Indian Government has requested 11 coal plants within 300 kilometres of Delhi use 5–10 per cent biomass.
Indonesia: Rain, COVID-19 restrictions and equipment shortages limit Indonesian exporters’ ability to increase production despite high prices.
Poland: The environmental permit for proposed Zloczew mine has been formally cancelled [Tweet] after power utility PGE abandoned the project in June.
South Africa: China’s decision to end overseas coal finance raises doubts over plans for a 1320–3000 MW coal plant as part of the proposed Musina-Makhado Special Economic Zone.
US: Utah Inland Port Authority sought [paywall] to revive a disused California railroad to facilitate coal exports.
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New renewables in Turkey cheaper than plants runnng on imported coal: A report by the climate think tank Ember argues it is cheaper to install new wind and solar capacity in Turkey than to run the country’s 9000 MW of coal capacity reliant on expensive imported coal. Plants reliant on imported coal account for 45 per cent of the country’s coal capacity. At current prices it is estimated utilities reliant on imports will spend about US$3 billion on imported coal this year. The latest data suggests wind power in Turkey costs about US$40.8 per megawatt hour (MWh) and solar US$51.9 per MWh. In comparison, based on the forward cost of coal for the next month, plants reliant on imported coal will generate electricity for between US$62–77 per MWh. (Ember)
Bank of China ends lending for new coal mines and overseas coal plant: The Bank of China has announced that from October 1 it will no longer provide financing for new coal mining and coal power projects outside China. The restrictions also apply to Hong Kong and Macau. However, the bank said the new policy would not affect projects that have already been approved. In its statement the state-run bank said it would “strengthen the control of the balance of ‘high energy consumption and high emission’” industries and increase financial support for “green projects”, which it defines as including “the upgrading and transformation of emission reduction technologies, the clean and efficient use of fossil energy, and the flexible transformation of coal power” [translation]. (Reuters, Bank of China [Chinese])
Moody’s warns of Asian coal companies credit risk over water: Moody's Investors Service has found 10 Asian countries, including India, Pakistan, Bangladesh and China, have highly negative or very highly negative exposure to water management risks. The report classes coal mining and power generation as one of the most exposed sectors. Moody’s says coal mining companies are exposed due to competition with local communities for increasingly scarce water supplies and due to the risks of water contamination caused by their operations. Utilities NTPC and PLN, respectively owned by the Indian and Indonesian governments, are rated as having “moderately negative exposure”. (Business Standard, Moody’s)
Chinese planning agency pushes for higher steel scrap use: The National Development and Reform Commission, the central economic planning agency, estimates China’s steel scrap use will rise from the 260 million tonnes used in 2020 to 320 million tonnes in 2025 as part of the strategy to achieve peak greenhouse gas emissions by 2030 and carbon neutrality by 2060. Hwabao Securities, the research arm of state-owned Baosteel Group, estimates crude steel production could plateau in the 2021–25 period, with increased scrap usage resulting in metallurgical coal demand falling by 21 million tonnes over the period. China, which is the world’s largest importer of metallurgical coal, has faced high metallurgical coal prices due to increased restrictions on domestic producers and an informal ban on importing cargoes from Australia, the world’s largest metallurgical coal exporter. (S & P Global)
China’s coal utilities hit by high prices: Power cuts in major Chinese provinces have increased pressure on provincial and national leaders for power price reforms and increased domestic coal production and imports from potential suppliers such as Indonesia, Russia and Mongolia. Power utilities have been hit by high domestic and imported thermal coal prices which have made coal power generation unprofitable, leading utilities to cut loss-making coal generation. Reduced coal generation has occurred when power demand has been booming. (Reuters, Reuters)
High thermal coal prices crimp Indian demand: As global export market coal prices have soared, new data reveals Indian imports of both thermal and metallurgical coal have been curbed. The consultancy Kpler estimates imports in September may be just 13.3 million tonnes, the lowest level since June 2020. If Kpler’s forecast is right it would represent the fourth month in a row of decline, with September volume 38 per cent lower than imports in April. The high prices have also curtailed imports by China, which has an unofficial ban on imports from Australia over a diplomatic dispute. To offset Australian coal, Chinese importers have turned to cargoes from Indonesia, Russia and Mongolia. (Reuters)
Japanese insurer drops new thermal coal mining projects: Tokio Marine Holdings, one of Japan’s three largest insurance companies, has announced that from October it will stop underwriting and financing new thermal coal mining projects in Japan and overseas. Last year Tokio Marine, along with Sompo Japan and Mitsui Sumitomo, ruled out underwriting new coal power plants. Nikkei reports Sompo and Mitsui Sumitomo are likely to follow Tokio Marine’s new policy restrictions. It is estimated Japanese insurance companies earned 10 billion yen ($US91 million) per year from underwriting coal mining projects. (Nikkei Asia)
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ADB Backs Coal Power Retirement in Southeast Asia, Institute for Energy Economics and Financial Analysis, September 2021. (Pdf)
This 20-page paper examines the Asian Development Bank’s proposed plan to team up with private financial players to accelerate the retirement of coal plants in Southeast Asia.
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