April 11, 2019
Issue 271  |  View Past Issues

Editor's Note

As with most weeks, the coal industry is never far from controversy. In Malaysia, former Prime Minister Najib Razak is facing charges over embezzlement from funds invested by a sovereign wealth fund in a company proposing a Mongolian coal project. In Indonesia, an NGO has raised questions over the sale of a coal company by Luhut Pandjaitan, who is now a minister in President Joko Widodo’s government. In Australia, the Minister for Environment, under pressure from pro-coal members of the government, granted approval for a vital water management plan for Adani’s Carmichael coal mine.

Meanwhile, leading investors have urged the International Energy Agency to include a scenario in its next World Energy Outlook that explicitly maps out how to limit global warming to 1.5 degrees. The Norwegian Government is also proposing to tighten the investment guidelines of its sovereign wealth fund which could force divestment from several major coal producers. In the US, declining exports are likely to result in intensified competition in the domestic market, causing more economic pain for struggling coal producers. Analysts also warn that production from the vast open-cut coal mines in the Powder River Basin in Montana and Wyoming could decline far faster than most community leaders expect.

In Vietnam, pollution from a newly commissioned Chinese-built and -financed plant has alarmed local residents. In Russia, Murmansk port authorities are pinning their hopes of controlling a persistent coal dust problem on the construction of 20-metre-high fences around their stockpile. In Canada, a government audit found that the federal environment agency responsible for protecting waterways had undertaken no inspections of coal mines since 2015. In Finland, the state-owned Fortum is seeking to downplay its role as one of Europe’s biggest and deadliest polluters as a result of its investment in Uniper, a company with major coal and lignite plants In Europe.

Bob Burton


Eskom in denial about premature deaths

Eskom's high-level denial of the health toll of its coal power plants is a symptom of a much bigger problem: the utility has focussed so heavily on coal they are in a terrifying death-spiral, writes Melita Steele from Greenpeace Africa in Fin24.

The fall and fall of coal mining in the Powder River Basin in the US

While Wyoming and Montana leaders have come to accept a gradual decline in coal production from the US’s largest open-cut coal mines, the fall is likely to be far faster than they are ready for, writes Heather Richards in the Casper Star-Tribune.

The high costs of Pakistan’s ‘black gold’

Far from being an economic boon for the people of the Thar region in Sindh province, the development of lignite power stations will impose heavy social, economic and environmental costs on Pakistan, writes Sohaib R. Malik in Dawn.

Top News

Ex-Malaysian Prime Minister faces court over corruption claims on coal deals: The trial of former Malaysian Prime Minister Najib Razak has begun. Charges against Najib concern 42 million ringgit (US$10.3 million) in suspicious transactions by SRC International, a former subsidiary of 1Malaysia Development Berhad (1MDB), which invested in a Mongolian coal project. Prosecutors allege the funds from SRC International were transferred to Najib’s personal bank accounts. A total of 42 charges have been filed against Najib over an estimated US$4.5 billion missing from the 1MDB sovereign wealth fund. (Asia Times)

More questions raised about coal dealings of senior Indonesian minister: An investigation by Global Witness has raised questions about the November 2016 sale by Luhut Pandjaitan of his 72 per cent stake in the Indonesian coal company Toba Bara Sejahtra to the Singapore-based Highland Strategic Holdings. The value of the transaction and the owners of the trust that owns Highland Strategic Holdings have not been made public. Pandjaitan is currently the Co-ordinating Minister for Maritime Affairs and an ally of President Joko Widodo, who is seeking re-election at the general election on April 17. Toba Bara Sejahtra operates coal mines in Kalimantan and is building two coal plants in Sulawesi. (Global Witness)

Australian Government approves Adani water plan: Australia’s Minister for Environment, Melissa Price, has approved Adani’s proposed groundwater management plan, an important permit the company needs before proceeding with the Carmichael coal mine. Ahead of the decision a Queensland National Party MP said Price should be sacked if she didn’t approve the plan before the federal election was called. However, Adani still has several hurdles to clear. The groundwater management plan requires the approval of the Queensland State Government; however, the Queensland Minister for Environment, Leeanne Enoch, has flagged that there are “uncertainties” relating to the groundwater modelling and that two further management plans require approval. Adani also requires insurance but Market Forces is stepping up its campaign to have Liberty Mutual rule out involvement in the project. The Australian Conservation Foundation is also considering the possibility of a legal challenge against Price’s approval of the groundwater management plan. (Guardian, ABC News, Brisbane Times, Market Forces)

Fine particle air pollution slashes life expectancy of babies: The latest State of the Global Air report found that in 2017, 92 per cent of the world’s population lived in areas that exceeded the World Health Organization’s (WHO) guideline for PM2.5 fine particle air pollution. The WHO’s target is for less than 15 micrograms per cubic metre (μg/m3) with interim targets of 35μg/m3 and 25 μg/m3. The report estimates that in South Asia, where air pollution levels are the highest, the life expectancy of children born in countries like Pakistan and Bangladesh is up to 30 months less than the global average. (CNN, BDNews24.com, Health Effects Institute)

Complaints over pollution from new China-backed plant in Vietnam: In response to complaints about air and water pollution by residents, Quang Ninh provincial authorities have requested the 600 megawatt (MW) Thang Long coal plant cut its emissions. The plant, which is owned by the privately-owned Vietnamese company Geleximco Group, was only commissioned in mid-2018. In particular, residents have complained about pollution from the fly ash dump, which the company has sought to address by erecting a fence and installing sprayers. Residents have also complained about black smoke from the plant and wastewater emissions. The plant was built by Wuhan Kaidi Electric Power Engineering and largely financed by the China Development Bank and China Export and Credit Insurance Corporation. (Dantri [Google Translate], CoalSwarm)

Canadian audit finds weak federal oversight of coal mines : An audit by the Commissioner of the Environment and Sustainable Development has found the Canadian Government’s regulation of mining impacts on fish is deficient. The audit notes that while the regulation of impacts on water quality by coal mines is notionally more stringent than metal mines, the government agency with federal responsibility for the sector has not undertaken any inspections since 2015 because they claimed they had found “a high level of compliance”. However, the audit noted that without data the risk factors associated with coal mines could not be properly assessed or priorities set to protect fish and their habitat. The audit found that while there was no data for inspections of coal mines, on average a non-metal mine was only inspected once every 2.4 years. (Commissioner of the Environment and Sustainable Development)

Russian port builds screens in hope of controlling dust pollution: With increasing public alarm over coal dust pollution, Murmansk Commercial Seaport is pinning its hopes on the construction of 20-metre-high screens to reduce coal dust blowing from the port’s coal stockpiles. So far just over 500 metres of the more than two kilometres of proposed screens have been built. An earlier dust suppression strategy of spraying the stockpiles with water did little to reduce air pollution in the surrounding area, in part because the volume of coal exported through the port increased. (Bellona)


Australia: Water pumping embargo hits Namoi River farmers while Whitehaven Coal wins exemption.

France: French Government sticks to 2022 coal phase-out date after report by grid operator.

Hungary: Analysts argue that close ties between the fossil fuel industry and the political establishment is blocking the transition away from coal.

Ireland: Government bows to legal threat from coal traders and defers the introduction of a ban on “smoky” coal for home heating.

Poland: Opposition group launches European Union election campaign promising to cut pollution by banning coal for home heating.

Russia: Republic of Yakutia proposes US$13.7 million upgrade to Zeleny Mys port on the Kolyma River to enable coal exports from the Zyryanovsk coalfield.

Slovakia: Newly elected president plans to urge government to end coal subsidies.

US: Judge castigates Rio Tinto over failure to disclose 25,000 documents relating to fraud charges the Securities and Exchange Commission has laid against the company over its failed Mozambique coal project.

US: A dozen senators oppose Trump administration proposal to cut carbon capture and storage funding for two programs from US$199 million to US$69 million.

Companies + Markets

Investors call on IEA to model 1.5 degree scenario: A group of scientists and major investors, including Hermes Investment Management, Allianz Group and Legal & General Investment Management, have written to the International Energy Agency (IEA) urging future editions of the annual World Energy Outlook to model an energy scenario aimed at ensuring a two-thirds probability of limiting global warming to 1.5°C. Ingrid Holmes from Hermes said that in recent years “the credibility of the scenarios from the IEA has been reduced” due to its failure to model scenarios that match the scale of the energy transformation required. The IEA defends its current scenarios. The IEA has been criticised for consistently underestimating the rate of deployment of solar and wind power and significantly overestimating their costs. (Financial Times, Corporate Knights, Bloomberg Opinion)

Norwegian Government set to tighten rules of sovereign wealth fund: The conservative Norwegian Government is proposing to change the country’s sovereign wealth fund guidelines to exclude investments in companies that produce over 20 million tonnes of thermal coal or have over 10,000 MW of coal power plants. The current guidelines, which were introduced in 2015, require a review or divestment only from companies that generate over 30 per cent of their revenue from thermal coal or coal power. The proposed new limits could force the fund to divest from the coal mining companies Glencore, Anglo American and BHP, as well as the big European power generators RWE and Uniper. The Government Pension Fund Global has stakes of US$122m and US$162m in Glencore and BHP respectively, making it a top-ten shareholder in the companies. (Financial Times, Bloomberg)

Transition challenge looms for Navajo Nation: With the closure of the Navajo Generating Station scheduled for December this year and closures looming at the San Juan Generating Station in 2022 and the Four Corners plant in 2031, the Navajo Nation is confronting how to generate employment for tribal members and tax revenue for the community. One option is using the 500 MW of transmission capacity the Navajo Nation is entitled to for new renewables capacity. Peabody Energy, which waged a campaign to keep the Navajo Generating Station open to secure the future of its Kayenta mine, recently laid off 40 workers and has proposed no retraining or redeployment options for the 300 remaining mine workers, most of which are Navajo. (EENews, Institute for Energy Economics & Financial Analysis)

Falling US exports to hit domestic market: With the price of thermal coal in the North European market falling from over US$100 per tonnes in October to just US$55 a tonne, US exporters are likely to divert production to the US markets. Over the last year 54 million tonnes was exported to Europe and Asia when prices averaged US$92 a tonne. Seaport Global analysts argue that exporters consider US$80 to US$90 per tonne as a profitable range but below US$75 a tonne as the lower limit for exports. With thermal coal exports estimated to fall by 12 per cent in 2019 and a further 25 per cent in 2020, the analysts argue that thermal coal from Northern Appalachia and the Illinois Basin is likely to face increased competition in a declining domestic market. (Platts)

Eskom decides to complete troubled Medupi and Kusile plants: Eskom has plans to spend another 18 billion rand (US$1.27 billion) to complete the part-built 4764 MW Medupi plant and the 4800 MW Kusile plant. Eskom’s Chief Executive, Phakamani Hadebe, said that “there is no turning back now. We just have to correct what we have. ” Five of Medupi’s six units have already been commissioned and the Kusile plant, which has only two units commissioned, is reported as being between 89 and 91 per cent complete. A November 2017 report by Meridian Economics recommended that Units 5 and 6 at the Kusile plant be scrapped. Eskom has discovered numerous significant faults in the commissioned units at both plants that make them unreliable and have contributed to the recent widespread blackouts. A further 5.5 billion rand (US$390 million) has been allocated to address the technical problems at the plants. Hadebe also flagged the utility is aiming to cut 20 billion rand (US$1.41 billion) in operating costs over the next three to four years in a bid to address its poor financial state. (Financial Times, Times Live)

Finnish government-owned company emerges as a major European polluter: A report by Climate Action Network Europe has found that Fortum, a company owned by the Finnish Government, is now one of Europe’s largest greenhouse gas emitters with its power station pollution the cause of an estimated 320 deaths a year. In June 2018, Fortum bought a half share in Uniper, which has over 11,000 MW of coal plants in Russia, Germany, the UK, France and the Netherlands. Fortum promotes itself as “a leading clean-energy company” but excludes Uniper’s greenhouse gas emissions from its own reporting on the grounds that Uniper is a separate company. (Yle, Europe Beyond Coal)

New study argues renewables plus storage better than CCS on fossil fuel plants: In a paper published in Nature Energy researchers from Lancaster University and four other universities argue that solar and wind coupled with storage is more energy efficient than investments in carbon capture and storage (CCS) on new coal and gas-fired plants. The team found that the worst-performing renewables plus storage projects achieved results equal to the best CCS projects while moderately efficient renewables locations ensured a better energy return than the majority of carbon capture technologies. The authors argue that CCS should be viewed as a niche player in decarbonisation rather than “as a critical technology option as current climate agreements view it.” (Lancaster University, Nature Energy)


Commission on Growth, Structural Change and Employment: Final Report, German Government, January 2019. (Pdf)

The 128-page final report of the German Government’s coal exit commission is now available in English.

Indonesia’s Worsening Air Quality and its Impact on Life Expectancy, Energy Policy Institute at the University of Chicago, March 2019. (Pdf)

This 10-page paper notes that increased coal generation is a significant contributor to the rapidly worsening air quality in Indonesia and one of the sectors where pollution control regulation would reduce the significant health impacts.

State of Global Air 2019, Health Effects Institute, April 2019. (pdf)

This 20-page report provides a global overview of air pollution trends including for PM2.5 fine particle air pollution, of which coal plants are a significant source.