Steel plants poised to become stranded assets or bust climate targets
The world’s steel sector could put an estimated US$70 billion of investment at risk of stranding if it pursues investment in new carbon-intensive steel projects, writes Caitlin Swalec from Global Energy Monitor in Carbon Brief.
Cambodia embraces dirty energy fearing drought-driven shortages
As climate change and drought has crimped the country’s hydro generation, the Cambodian Government has turned to new fossil fuel projects including a coal plant in the Botum Sakor National Park, write Danielle Keeton-Olsen and Yon Sineat in The Third Pole.
China’s biggest dumps Zimbabwe coal plan
The Industrial and Commercial Bank of China has revealed it won’t fund the 2800 megawatt (MW) Sengwa coal project in northern Zimbabwe, write Ray Ndlovu and Antony Sguazzin in Bloomberg.
North Macedonia announces coal exit by 2027
North Macedonia has announced it will close its lignite power plants by 2027 and invest in new solar and wind capacity. The announcement will affect two plants and associated mines: the 125 megawatt (MW) Oslomej power station supplied by the Oslomej mine and the 699 MW Bitola lignite plant supplied by the Suvodol coal mine. In late 2020 Elektrani na Severna Makedonija announced the first of the three units at the Bitola plant would be switched to natural gas within five years. Now Prime Minister Zoran Zaev has announced 1600 MW of solar capacity and 600 MW of wind generation will be built to replace the two plants. The announcement makes North Macedonia the first country in the Western Balkans to commit to a coal phase-out. (Emerging Europe, Balkan Green Energy News)
US Supreme Court delivers final blow to NW coal port plan
The US Supreme Court has refused to hear a legal challenge by Montana and Wyoming against a decision by Washington State to refuse a Clean Water Act permit for Lighthouse Resources’ proposed Millennium Bulk Terminals coal export terminal. The terminal, which was proposed to cater for the export up to 44 million tonnes of coal to the Asia-Pacific market, was opposed by tribal groups, residents along the rail line and environmental groups. After Lighthouse Resources declared bankruptcy in December 2020, Montana and Wyoming sought to take up legal challenges in the hope of providing access to the Asian market for coal from the landlocked states. Jan Hasselman, a lawyer representing the Power Past Coal alliance welcomed the decision. “The coal industry’s assault on the Pacific Northwest is officially over,” he said. (Portland Business Journal)
UK mining company rules out appeal on rejected project
The Banks Group has ruled out launching a legal appeal against the unanimous decision of Newcastle City Council's to reject permission for the proposed open cut mine at Dewley Hill. The company had planned to produce about 800,000 tonnes of coal over three years for a local brickworks. The council rejected the proposal on the grounds it was environmentally unacceptable due to its impacts on the landscape and biodiversity. In the last year the Banks Group has also suffered defeats over the proposed extension of its Bradley mine in County Durham and rejection of the proposed mine near Druridge Bay in Northumberland. A group of residents who campaigned against the Bradley mine recently gathered to celebrate the end of opencast mining in England. “It has been a difficult period, but we are delighted to see the back of Banks Group and that is what we are now celebrating,” said resident June Davison. (The Northern Echo)
Chile’s lower house votes for accelerated coal closures: A bill to ban the construction or operation of coal plants after 2026 has passed through Chile’s lower house, despite the opposition of the Minister for Energy, Carlos Jobet, and the national energy commission. The bill won the support of 93 members of the Chamber of Deputies with five voting against it and 47 abstaining. The bill has yet to be voted on in the Senate. An amendment to defer the phase-out date until the completion of a new transmission line in approximately 2028 was defeated. Civil society groups have been pushing for the closure of the country’s 23 coal units, which have a combined capacity of 4882 MW, due to pollution impacts and the availability of solar and wind resources. In 2019 the government negotiated an agreement with the country’s power utilities to retire all coal plants by 2040. (BNAmericas)
Canada calls in proposed mine for federal environmental assessment: Canada’s Federal Environment and Climate Change Minister, Jonathan Wilkinson, has insisted the proposed Tent Mountain coal mine near Alberta–British Columbia border must undergo federal environmental assessment. Wilkinson said the mountaintop mine project, which has been proposed by the Australian company Montem Resources, could affect the environment in both provinces as well as impact Indigenous rights and fisheries. First Nations and environmental groups had requested the federal government require assessment of the project. (CBC)
Study urges accelerated coal phase-out to avoid reliance on novel technologies: New research published in Environmental Research Letters argues limiting global heating to a 1.75°C increase in global temperatures without relying on uncertain large-scale carbon dioxide removal technologies will require a 70 per cent fall in carbon dioxide emissions by 2030. This would require the almost total elimination of unabated coal consumption by 2030. The authors estimate excluding reliance on carbon removal technologies would require dramatically more ambitious action including the commission of 1000 gigawatts (GW) of new renewables capacity a year by the mid-2020s. This would be four times greater than current renewables installation rates. (Carbon Brief, Environmental Research Letters)
Many Indian utilities ignore water efficiency standards: A survey by the Centre for Science an Environment of 154,000 MW of India’s coal plant capacity has found almost half the plants relying on freshwater do not meet water efficiency standards first announced in 2015. Most of the plants failing to meet the standards are owned by public utilities. The standards require coal plants built before January 1, 2017 to consume less than 3.5 cubic metres of water per megawatt hour (MWh) with plants commissioned after that date to use 3 cubic metres of water or less per MWh. India’s fleet of coal plants consumes about 70 per cent of water consumed by all industries with about half located in water-scarce districts, often causing conflict with other users. Coal plants reliant on seawater for cooling are exempt from the standards. (Centre for Science and Environment)
Bangladesh confirms cancellation of ten coal plants, others proceed: Bangladesh’s Prime Minister, Sheikh Hasina, has confirmed nine proposed coal plants that have made no progress towards construction will be scrapped. The cancellation of the nine plants, which have a combined capacity of 8146 MW, was flagged in February 2021 by the Secretary of Power, Habibur Rahman, but was subject to Hasina’s approval. A further one or two proposed coal plants may be scrapped. The decision has been driven by the poor viability of plants reliant on expensive imported coal and growing public opposition to the health impacts of coal plant pollution. However, construction work continues on five coal plants, which have a combined capacity of 4941 MW, including the controversial Rampal and Matabari projects. (Daily Star, Eco-Business)
Community leader charged over protest against Zimbabwean coal plan: One hundred community organisations have expressed their support for the vice-chairperson of the Dinde Residents Association, Never Tshuma, who faced court on June 17 after he led a protest against Beifa Investments seeking to establish a coal exploration project on land owned by the Dinde community. In September 2020, the Zimbabwean Government awarded Beifa Investments, a Chinese company, over 4000 hectares of Dinde land for coal exploration and a possible coal power station. In April, Tshuma led a protest of community members to remove a tent Beifa Investments had set up on their land. (Mail & Guardian)
“I tell you when you transition. When there are no ships sitting off Newcastle and sitting off Mackay. You know what you can come back and tell me? That we’ve got problems in the coal industry,”
said Barnaby Joyce, Australia’s Deputy Prime Minister.
Australia: Study finds pollution from 45-day Hazelwood mine fire in 2014 damaged lungs of residents living downwind.
India: National Green Tribunal urges environment ministry cancel the permit granted for Ambuja Cements coal washery in Chhattisgarh.
India: Talcher Fertilizers reaches financial close on coal-to-fertiliser plant in Odisha proposed to use 2.5 million tonnes of coal from the Talcher Mines.
Australian Government slashes forecast for seaborne thermal coal trade: The Australian Government’s Office of the Chief Economist has slashed its forecast for the seaborne thermal coal market and now estimates an increase of just 7 million tonnes to 2023 compared to its March estimate of 65 million tonnes growth. The agency’s latest Resources and Energy Quarterly notes curbs on imports to India, South Korea and Japan and a shift in exports as China’s unofficial import ban on Australian coal remains in place. The report notes Russian exports are expected to grow due to export infrastructure upgrades with Indonesian exports likely to rebound from about 400 million tonnes in 2020 to 450 million tonnes this year. Some Australian exports, blocked from the Chinese market, have been diverted to the Indian market with knock-on effects on South African exporters. (Argus, Department of Industry, Science, Energy and Resources)
Report estimates solar beats existing coal in China and India: Bloomberg New Energy Finance (BNEF) estimates new solar capacity was cheaper in 2020 than operating existing coal plants in both China and India. The two countries account for about 62 per cent of global coal plant capacity. BNEF estimates new solar capacity in China is US$34 per megawatt hour (MWh) compared to a coal-fired plant at U$35 per MWh. In India, BNEF estimated solar was US$25 per MWh, compared to an average cost of an existing coal plants of US$26 per MWh. BNEF estimates new build solar cost US$50 per MWh in Germany compared to existing coal and gas plants at over US$70 per MWh in 2021. The report estimates the costs of large-scale solar and onshore wind has fallen by up to 87 per cent and 63 per cent respectively since 2010. (Renewable Energy World)
Risk of stranded steel assets with investment in carbon-intensive projects: A survey of 533 of the world’s largest steel plants has revealed 42 proposed projects with a capital cost of about US$70 billion. Most of these projects propose to use the high-carbon blast furnace–basic oxygen furnace process even though decarbonisation scenarios suggest the industry’s emissions need to fall by around 90 per cent by 2050 to keep global heating below 1.5°C. The report finds global steel demand in 2019 was about 25 per cent lower than production capacity, suggesting many older and polluting steel plants can be closed without disrupting global supply. The report notes the recent trend to invest in ‘green steel’ projects but argues greater investment is required to ensure commercial deployment in the coming decades. (Global Energy Monitor)
Japan’s international bank proposes CCS and ammonia loopholes for coal lending: The Japan Bank for International Cooperation (JBIC), a government export credit agency, has announced it may fund international coal projects if they include provision for either carbon capture and storage or ammonia co-firing. At the recent G7 summit in the UK, Japan and other countries pledged to end the financing of international coal plants by the end of 2021. In a new three-year business plan JBIC announced it would provide finance to support carbon capture and storage projects as well as plants including ammonia co-firing with coal. (Reuters)
Shareholder resolutions target Japanese utilities, lenders: A shareholder resolution calling on Mitsubishi UFJ Financial Group (MUFG) to align its financing and investments with the goals of the Paris Agreement gained 23 per cent support. The resolution, filed by Kiko Network, Market Forces and 350.org, spurred MUFG to announce a plan to achieve net zero financed emissions by 2050. Shareholders in Kansai Electric Power Company have rejected a resolution proposed by the City of Kyoto to rule out new coal plants and require it to install carbon capture and storage on its existing 1800 MW Maizuru coal plant near Kyoto. Major investors, including KLP, Norway's largest pension fund, backed the proposal. “There is no excuse for wasting capital on risky nuclear or polluting coal when clean solutions are readily available,” said Kiran Aziz from KLP. (No Coal Japan, Nasdaq)
Glencore buys out joint venture partners in Colombian mine: Glencore has agreed to buy out the one-third shareholdings of BHP and Anglo American in the Cerrejon thermal coal mine in Colombia. Glencore announced it would pay US$588 million for its joint venture partners’ combined 66.6 per cent stake in the project. The company is aiming to complete the purchase later this year, subject to regulatory approval. The mine and associated port infrastructure was expanded in 2011 from 33 million tonnes a year to 40 million tonnes a year at a cost of US$1.3 billion. However, production has declined and is currently expected to supply about 18 million tonnes in 2020–21. The project has been hit by the rapid decline in European demand, the impact of COVID-19, prolonged strikes, legal actions and protests by indigenous landowners affected by the mine. (Glencore)
Colombian regulator rejects Glencore bid to surrender Prodeco licences: Colombia’s mining regulator, ANM, has rejected Prodeco’s request to relinquish three mining titles for mines it suspended production in March 2019 due to the downturn in coal demand caused by the COVID-19 pandemic. Prodeco, a subsidiary of Glencore, produced 13 million tonnes of coal from the three mines in 2019. The company wants to relinquish the mining titles to eliminate the care and maintenance costs of the mines even though the price for Colombia coal has increased by over 130 per cent in the last year. Prodeco has appealed against ANM’s decision and is expecting a final decision on July 20. Glencore is the world’s largest exporter of thermal coal with mines in Australia and South Africa. (Argus)
Report argues Indonesia’s 2060 pledge lacks crucial details: A report by the Institute for Energy Economics and Financial Analysis (IEEFA) argues that Indonesia’s Ministry of Energy and Mineral Resources current energy policies are inconsistent with President Jokowi’s pledge to achieve carbon neutrality by 2060. IEEFA said no early coal plant retirements have been proposed and 16,000 MW of new coal plants are still proceeding despite overcapacity in the main Java-Bali and Sumatra grid. While the 2021 draft Power Sector Business Plan reduces forecast demand growth from 6.4 per cent a year to 4.9 per cent a year, it continues to sideline solar and wind capacity in favour of biomass co-firing at coal plants plus new large hydro and geothermal projects. IEEFA notes the draft power plan appears to shelve 6800 MW of proposed coal plants – nearly all proposed by the publicly owned utility PLN or its subsidiaries – and substitute “renewable baseload” plants for them. (Institute for Energy Economics and Financial Analysis)
Do Not Revive Coal: Planned Asia coal plants a danger to Paris, Carbon Tracker, June 2021. (Pdf, registration required)
This 48-page report estimates 92 per cent of planned coal units in China, India, Vietnam, Indonesia and Japan will be uneconomic with up to US$150 billion at risk of being wasted. The five countries account for 80 per cent of the world’s planned new coal plants.