April 12, 2018
Issue 224  |  View Past Issues

Editor's Note

The tide continues to recede on coal power. In Myanmar, residents alarmed at the prospect of air and water pollution have welcomed the decision of the central government to rule out a proposed 1280 megawatt (MW) plant in Kayin state. In Finland, the government has agreed to end coal power by May 1, 2029. In the US, Moody’s estimates many municipal utilities are running expensive coal plants when cheaper alternatives exist. In India, the Central Electricity Authority’s revised national electricity plan proposes a dramatic acceleration in the retirement of old coal plants, though with some complex caveats.

Over the last week controversies over pollution from coal and coal power have come to the fore once more. In India, a government advisory body has found that 13 mines in Telangana state were operating illegally without environmental approval. In the Philippines, a government agency has suspended work on a coal plant expansion after finding the company had illegally expanded into a marine reserve. In Australia, a court found the company behind a failed coal seam gasification project guilty on five charges stemming from extensive pollution of its site. In Indonesia, authorities are investigating whether the rupturing of a major undersea oil pipeline was caused by a coal ship dragging its anchor in a storm.

Cleaning up controversial deals over coal has also gathered attention this week. For example, in South Africa, President Cyril Ramaphosa has ordered an investigation into a range of scandals involving Eskom and coal and power station deals.

Bob Burton


Nedbank is moving on coal power, but two plants are stuck on its radar

Nedbank, one of South Africa’s biggest banks, has vowed not to fund more new coal plants, making it the first bank in the global South to distance itself from new coal projects. But Nedbank  insists its new policy will only apply after it has decided whether to fund the proposed Thabametsi and Khanyisa projects, write Robyn Hug from the Centre for Environmental Rights and Yann Louvel from BankTrack.

BHP gives the World Coal Association the cold shoulder

BHP has axed its membership of the World Coal Association because of its opposition to the Paris Agreement, but the mining company is no saint when it comes to protecting the climate, writes Bob Burton in EndCoal.


Myanmar Government axes proposed coal plant

Residents of Kayin state have welcomed the March 14 announcement by Myanmar’s Minister of Electricity and Energy, U Win Khaing, that the government will not approve the proposed 1280 MW coal power plant in Hpa-an. The plant, which has met with strong local community opposition, has been proposed by a Myanmar subsidiary of the controversial Toyo Thai Power Corporation (TTCL), a joint Japanese and Thai engineering and construction company. However, Kayin residents fear the state government will support the project despite the decision of the central government. In October 2017, the state government and TTCL entered into a joint venture agreement for the project and organised for some residents to visit the Hekinan coal plant in Japan. (Myanmar Times)

Finland bans coal power after May 2029

The Finnish Government has announced that it will legislate for a ban on the use of coal in power generation after May 1, 2029. In response to pressure from civil society groups to end coal power by 2025, the government will establish a €90 million (US$111 million) fund for energy companies that opt to end burning coal by 2025. However, the €90 million in funding will be diverted from support for wind farms and half of it be made available for biomass as a substitute for coal in combined heat and power plants. The remainder of the funds will be allocated for alternative means of providing heating, including energy storage and geothermal energy. (Finland Ministry of Employment and the Economy [Google Translate])

Top News

Ministry finds Coal India subsidiary flouting environmental laws: India’s Ministry of Environment, Forests and Climate Change (MoEF) has found that a Coal India subsidiary, Singareni Collieries Company Ltd (SCCL), has illegally been mining coal at 13 of its mines in Telangana state without having obtained environmental clearances. MoEF’s expert advisory panel has recommended that action be taken against SCCL and that the company submit environmental impact assessments and conduct public hearings on the projects. At five of its mines, SCCL illegally mined a total of 41.3 million tonnes between 2007–08 and 2016–17, which it is now liable to pay penalties for. (The Hindu)

Philippines subsidiary of US company illegally damaged marine reserve for coal plant: The Philippines Department of Environment and Natural Resources (DENR) has suspended the seabed dredging permit associated with the 300 MW expansion of the Masinloc coal-fired thermal power plant. DENR stated that Masinloc Power Partners Company Limited (MPPCL) had illegally undertaken land reclamation in the Masinloc Oyon Bay Marine Reserve, built a seawall and used the reclaimed land for activities including the stockpiling of coal, the construction of conveyors and access roads. Until March 20 the US-headquartered AES Corporation owned a majority stake in in MPPCL, which it has sold to SMC Global Power for US$1.05 billion. (Manila Times, Business Mirror)

Underground coal gasification company convicted on pollution charges: A Queensland court has found Linc Energy guilty on five charges of causing environmental harm between 2007 and 2013 at its four underground coal gasification sites at Chinchilla. Lock the Gate, which has campaigned against the expansion of the gas industry in Queensland, argues the damage to prime agricultural land occurred because of the “weak regulatory scheme” in Queensland. The company is in liquidation and did not defend itself in the court case. Sentencing is scheduled for May 11. (ABC News, Sydney Morning Herald)

Dutch Government backs reconciliation talks in Colombian coal province: The Dutch Minister of Foreign Affairs, Stef Blok, has visited Colombia’s Cesar province to offer support for a reconciliation dialogue between coal mining companies and victims of human rights violations. The Swedish power company VattenfalI has flagged that it may end coal imports from companies that don’t reach an agreement and implement an action plan with human rights victims. After Colombian human rights advocates met with the German and Dutch ambassadors, a paramilitary group issued a leaflet threatening the lives of the human rights defenders and their families. The Glencore subsidiary, Prodeco, denounced all threats and acts of violence. Drummond also issued a statement. (PAX, PAX)

Huge Indonesian oil spill may have been caused by coal ship dragging anchor: The Indonesian oil company Pertamina has admitted that an oil spill covering almost 13,000 hectares originated from a broken oil pipeline near the company’s Balikpapan refinery not the coal ship MV Ever Judger which had originally been blamed as the source of oil. However, Indonesian authorities are investigating the possibility that the anchor of the coal ship had dragged the pipeline 100 metres out of position during a storm, causing the pipeline to rupture. (Reuters, Radio Australia)

Indonesian coal mine closed after squabble with police-connected palm oil company: In early 2018 a mining permit issued to Sebuku Iron Lateritic Ores (SILO) for coal to run its iron ore processing plant was cancelled by South Kalimantan Governor Sahbirin Noor. At the heart of the dispute was a standoff between SILO and a palm oil plantation company, Multi Sarana Agro Mandiri (MSAM), owned by coal baron Andi Syamsuddin Arsyad. MSAM had paid members of a mobile police unit to work for it with SILO responding by hiring soldiers to guard its site. After a new commander withdrew the military personnel, SILO’s licence was cancelled, prompting it to launch a legal challenge against the decision. (Tempo)

Report argues need for proposed coal plants to be scrapped: A University of Maryland report argues that to achieve the Paris Agreement’s goal of keeping the global temperature increase to below 2°C, all proposed coal plants must be cancelled, and retirement of existing plants by 2030 must be accelerated. The report estimates that, at a minimum, the US, India, China, Japan and South Korea, must retire 10 per cent of their existing fleet and cancel at least half of their proposed plants to meet the plans they submitted to comply with the Paris Agreement. (University of Maryland)


Australia: Summertime breakdowns of old coal units in Victoria trigger price spikes and put reliability at risk.

Bangladesh: Analysts argue Adani Power’s proposed Godda plant in India would benefit company but punish consumers.

India: The 700 MW Badarpur coal plant, which contributes 11 per of Delhi’s air pollution, is likely to close by the end of April.

India: Coal India seeks go-ahead for coal seam gas development without requiring gas-specific leases.

Kosovo: ContourGlobal is seeking to sell a 49 per cent stake and raise funds by early 2019 for the 500 MW Kosovo C plant.

Oman: Call for tender bids for 1200 MW coal plant at Duqm, which would be the country’s first.

US: Contura Energy paid Blackjewel US$21 million to take Eagle Butte and Belle Ayr coal mines in Wyoming off its hands.

Companies + Markets

South African President launches inquiry into Eskom: South African President Cyril Ramaphosa has approved a Special Investigating Unit investigation into possible corruption and misappropriation of public money at Eskom and the public freight company, Transnet. The proclamation specifically identifies the need to investigate Eskom coal contracts and potential maladministration at the Medupi and Kusile coal plants, which are currently under construction. The inquiry is an addition to investigations by the Hawks, the South African Government’s anti-corruption agency, and the judicial Commission of Inquiry into State Capture led by Deputy Chief Justice Raymond Zondo. Eskom also has launched internal investigations into some of the coal contracts with Gupta-linked companies. (TimesLive, IOL)

India’s revised national electricity plan accelerates coal retirements: The Central Electricity Authority’s final National Electricity Plan foreshadows the need to accelerate coal plant retirements over the next decade with 22,716 MW to be closed between 2017 and 2022, up from the original 5200 MW flagged in the draft plan. The increase is due to the number of plants over 25 years old without space for the installation of flue gas desulphurisation plants to meet pollution control standards. The plan also envisages the closure of a further 25,572 MW by 2027. However, while the draft envisaged no need for new coal plant capacity before 2027, the revised plan includes 6220 MW of new coal plants to be commissioned by 2022. It also proposes 46,000 MW of new peaking capacity in the 2022–2027 period, ideally from flexible sources, in addition to the 47,000 MW of coal plants under construction. (Business Standard, Central Electricity Authority)

Moody’s says most US municipal utilities losing on coal plants: Moody's estimates that about 72.3 per cent of 65,000 MW coal plants owned by US municipalities or generation and transmission cooperatives have operating costs above US$30 per MWh, which they claim makes the plants vulnerable to cheaper alternatives such as renewables and gas. However, Moody’s argues the ability of many municipal utilities and most of the cooperatives to set their own rates provides a buffer against the risk of old plants becoming stranded assets. (Moody’s)

US agency urges end to self-bonding: The Government Accountability Office (GAO) has recommended the Department of the Interior's Office of Surface Mining Reclamation and Enforcement stop allowing coal mining companies to claims of their own financial health as a guarantee of their ability to cover the cost of rehabilitating mined land. In a report reviewing the current US$10.2 billion in financial assurances given for rehabilitation works, the GAO found self-bonding presented significant risk to the government. It also found that the financial stability of some of the third-party companies that guaranteed US$7.8 billion in surety bonds “has been challenging in certain instances.” A new report by the Western Organization of Resource Councils has found that self-bonds have fallen to historically low levels after the bankruptcies of Peabody Energy, Arch Coal and Alpha Natural Resources. (Government Accountability Office, Western Organization of Resource Councils)

Lloyds limits coal policy to a fraction of its funds: Lloyds of London’s coal divestment policy, which came into effect on April 2, will only apply to its £2 billion (US$2.8 billion) Central Fund but not the £77.5 billion managed by almost 90 associated syndicates. Lloyds accepted a proposal from Unfriend Coal to define a coal company as a company that earns over 30 per cent of their revenue or electricity from coal, produces at least 20 million tonnes of coal a year, or operates at least 10,000 MW of coal-fired power stations. However, the policy does not exclude investments in new coal plants or restrictions on underwriting insurance for coal projects. (Insurance Journal, Unfriend Coal)


How the International Energy Agency Guides Energy Decisions towards Fossil Fuel Dependence and Climate Change, Oil Change International, April 2018. (Pdf)

This 44-page report finds the International Energy Agency skews its analysis in favour of levels of fossil fuel consumption that are incompatible with meeting the goals of the Paris Agreement.

Now is the Time to End Self-Bonding, Western Organization of Resource Councils, April 2018. (Pdf)

This 20-page report argues that, as self-bonding has hit an all-time low in the US coal industry, it could be quickly brought to an end with little impact on the coal industry.

Coal Mine Reclamation: Federal and State Agencies Face Challenges in Managing Billions in Financial Assurances, Government Accountability Office, April 2018.

This 36-page report reviews the management by the US Department of Interior and 23 state government agencies of financial assurances for coal mine rehabilitation.

The State of Global Coal Power: Proposed New Capacity and Power Sector Decarbonization, University of Maryland, April 2018. (Report here; Technical report here.)

This 19-page report argues that the Paris Agreement climate goals require the cancellation of proposed coal plants and the accelerated retirement of existing plants before 2030.

Coal Demand, Market Forces, and US Coal Mine Closures, Resources for the Future, April 2018. (Pdf)

This 65-page report claims that most of the jobs lost in the US coal mine sector have been at mines rather than power plants and that rising production costs at Appalachian mines have been the largest contributor to job losses, followed by lower natural gas prices and falling demand due to energy efficiency.