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March 14, 2024
Issue 505  |  View Past Issues
CoalWire
Published by Global Energy Monitor

Editor's Note

The revelation of the underreporting of Indonesia’s coal mine methane emissions highlights once more that the actual costs of coal mining are still vastly underappreciated. The announcement that the US and Canada have finally agreed on an International Joint Commission project to address water pollution from metallurgical coal mines in British Columbia is testimony to how long it can take governments to address evidence of significant problems. First Nations groups raised concerns about the transboundary impacts of Teck Resources coal mines over a decade ago. Canada is still considering new projects, with environmental groups calling for an investigation into a company reportedly begging work on a new trial mine without required federal permits. In Bangladesh, a cash-strapped British company is seeking approval from the re-elected Hasina government to revive a proposed mine that the local community has opposed for decades.

The future of Eskom and coal mining are significant themes in the public debate ahead of the May 29 South African election. Disgraced former President Jacob Zuma is seeking to make a comeback with the backing of a new party. The Economic Freedom Fighters, a minor party hoping to make significant gains, has vowed to oppose the closure of any coal mines. Eskom’s faltering coal plants are the central factor behind the persistent load shedding crisis. A South African news site extracted shocking pictures from a recently released consultants’ report highlighting the poor state of Eskom’s power stations.

Bob Burton

Features

Climate-science deniers and right-wing think tanks are plotting against the US clean energy transition

Residents supporting wind and solar in their communities are running up against the same barrier: a chorus of disinformation, much of it tied to, or even circulated directly by, fossil-fuel-backed groups wanting to preserve the status quo, writes Rebecca Burns in Sierra.

Don’t be duped by fossil fuel tactics

The fossil fuel industry, through its expansive influence over politics and the mainstream media, has been aggressively spreading fears about renewable energy projects, writes Tracey Davies in Business Live.

Modi’s fading renewables vision fires up India’s coal sector

The revival of interest by India’s private utilities in new and existing coal plants is an object lesson in the power of state intervention to skew markets away from cheap, clean power toward costly, fossil-fired incumbent businesses, writes David Fickling in Bloomberg.

Top News

Report finds Indonesia underreporting methane emissions: A report by Ember, a UK-based energy think tank, estimates that Indonesia’s methane emissions from open-cut coal mines could be up to eight times higher than reported by the government. Indonesia, which is the world’s third-largest coal producer and largest thermal coal exporter, does not report emissions from underground coal mines, which are typically significant sources of methane. The report also argues that Indonesia uses an outdated methodology for estimating methane emissions. Independent assessments of Indonesia’s methane emissions, calculated using satellite data or individual mine-level assessments, found emissions could be six or seven times higher than the official estimate. Indonesia is a signatory of the Global Methane Pledge that commits supporters to reduce methane emissions by 2030. However, Indonesia has not yet developed any comprehensive action plans to tackle methane emissions in the coal sector. (South China Morning Post, Ember, Ember [Pdf])

Canada and US agree on investigation into cross-border mine pollution: Canada and the US have announced an International Joint Commission (IJC) investigation of pollution from Teck Resources coal mines in British Columbia’s Elk Valley that flows into Lake Koocanusa, which straddles the border between the two countries. The IJC will establish a two-year study group to initiate action to reduce and mitigate the impacts of pollution from the mines. For over a decade, the Ktunaxa Nation, which includes four First Nations in British Columbia, the Confederated Salish and Kootenai Tribes in Montana and the Kootenai Tribe of Idaho, have pressed for an investigation into water pollution from the mines, with high selenium levels affecting fish populations. Canada, Teck Resources and the British Columbian government had previously opposed an investigation. In November 2023, Teck announced that it would sell its Elk Valley mines to Glencore, subject to Canadian government approval. (Reuters, The Narwhal, US & Canadian governments)

Call to investigate work on Canadian mine expansion: Ecojustice has called on the Canadian Department of Fisheries and Oceans (DFO) to investigate Coalspur Mines for commencing work on the expansion of the Vista mine in Alberta without seeking the required federal permits under the Fisheries Act and Species at Risk Act. Ecojustice represents two environmental groups, the Keepers of the Water Society and the West Athabasca Watershed Bioregional Society. Coalspur is proposing to expand its current 6 million tonnes a year mine by a further 4.5 million tonnes annually. It also proposes building a test mine to assess whether it could undertake a larger underground expansion. Both the proposed expansions are in water catchments with large populations of the Athabasca rainbow trout and bull trout. DFO said they had contacted the company but had not commenced an investigation. (National Observer)

UK company pitches Bangladesh mine plan to government: GCM Resources, a cash-strapped UK company, announced it has signed a four-year US$1 billion contract with PowerChina for the development of the 15 million tonnes a year Phulbari coal mine in northern Bangladesh. The contract is conditional on government approval for the development of the controversial open-cut mine, which has stirred local community opposition over the last two decades. In August 2006, three people were killed and more than 200 injured by police attacks on a protest against the mine and a proposed 1000 MW coal power station. In its recent annual report, the company stated that it planned to press the government for approval of the project once the Awami League government had settled in after the January 2024 election. In August 2022, the company hired a Bangladeshi lobbying firm, DG Infratech, on a two-year contract to achieve government approval for the mine. The company says it has received expressions of interest to supply coal to SS Power’s 1320MW Banshkhali coal plant and Barisal Electric Power Company’s 350MW unit at Barisal. Without the benefit of a cash flow from an operating business, GCM Resources has been reliant on a series of loans and small share raisings to stay afloat. (UK Investor Magazine, GCM Resources, Global Energy Monitor)

Turkish coal generation keeps increasing with growing Russian imports: A report by Ember, an energy policy think tank, estimates that Turkish coal generation reached record levels in 2023 and passed Poland to become the second-largest coal power generator in Europe after Germany. In 2013, coal generation in Turkey accounted for 12 per cent of electricity but increased rapidly to a 36 per cent share in 2023. Ember estimates that Turkish coal power generation could surpass Germany’s in 2024. Turkey spent an estimated US$3.6 billion on imported coal in 2023, with 17.4 million tonnes or 73 per cent, coming from Russia. In a separate development, Turkish President Recep Tayyip Erdogan issued a notification that 190 blocks of agricultural land would be compulsorily acquired to allow the expansion of the controversial lignite mine to supply the Yenikoy-Kemerkoy coal plant in Mugla province. Opposition to the expansion of the mine continues, with legal challenges before the courts. (Al-Monitor, Ember, MedyaNews)

South African party opposes coal mine closures: The leader of the populist Economic Freedom Fighters (EFF) political party, Julius Malema, said at the launch of the party’s platform for Mpumalanga province that the party opposed the closure of coal mines in the country. Mpumalanga province accounts for about 80 per cent of South Africa’s coal production and a dozen Eskom coal plants. South Africa will hold a general election on May 29, with polls suggesting that the African National Congress (ANC) is likely to lose its majority for the first time since 1994. Persistent load-shedding, corruption scandals and high unemployment have undermined support for the ANC. The newly formed uMkhonto weSizwe Party (MK) backed by former President Zuma is polling over ten per cent. The rise of the MK party has come at the expense of the EFF, which holds 44 seats in the 400-member lower house of parliament. Zuma resigned in February 2018 after a string of scandals, including over the ‘state capture’ of Eskom and other state-owned enterprises by the Gupta family companies. (SABC)

News

Australia: Environmental groups are dismayed that the federal Minister for Environment, Tanya Plibersek, will proceed to assess Vitrinite’s proposed Vulcan South mine in Queensland. The company proposes to clear nearly 800 hectares of koala habitat.

China: Coal industry officials and traders expect Chinese coal imports to be steady or decline in 2024. In 2023, China imported 474.42 million tonnes of coal.

China: Twelve workers died, and four are missing following accidents at two underground coal mines.

India: Mahan Energen, a subsidiary of Adani Power, has won the auction for the 956 million tonne Mara II Mahan coal mine in Madhya Pradesh.

India: The Indian government has announced plans to sell up to seven per cent of its stake in NLC India, a state-owned utility that mines over 50 million tonnes of coal and lignite a year and has 4600 MW of coal plant capacity. The government owns 79.2 per cent of NLC.

Mongolia: The Mongolian Coal Association estimates coal exports in 2024 could fall 13.8 per cent to 60 million tonnes.

Mozambique: Thai Mocambique Logistica has revived its proposal to build a new coal export port at Macuse with a 525-kilometre railway to the coal mines in Tete Province.

Poland: A Fitch Ratings analyst has warned that state-owned utilities could face ratings downgrades unless the government develops a plan to spin off coal assets and support investment in new renewables.

Russia: An explosion at a coal-based combined heat and power plant in Shagonar in southern Siberia killed one worker and injured 23.

Russia: Coal exporters refuse to dispatch cargoes to ports owned by companies named in the latest round of US sanctions.

Taiwan: The Minister of Economic Affairs, Wang Mei-hua, has highlighted the need to increase power prices to offset high imported coal and gas prices and stem losses by state-owned Taipower.

US: Ten coal barges broke free of the towing vessel on the Ohio River, with two partially sinking.

US: The State Policy Network, a hub for a national network of right-wing think tanks, announced that in 2024, it aims to mobilise state lawmakers to block states from supporting wind and solar power projects.

Companies + Markets

China endorses weak energy intensity target for 2024: The annual work plan presented to China’s National People’s Congress includes a weak 2024 energy intensity reduction target of 2.5 per cent. The current five-year plan includes a commitment to reduce energy intensity per dollar of gross domestic product by 13.5 per cent by 2025, a critical emissions reduction goal. The Centre for Research on Energy and Clean Air (CREA) recently estimated that China’s energy intensity fell by only two per cent between 2020 and 2023. CREA estimated carbon dioxide emissions would need to fall by four to six per cent by 2025 to meet the current energy intensity target by 2025. “China is effectively admitting its failure to fulfil the five-year target,” said Li Shuo from the China Climate Hub at the Asia Society. (Climate Home)

Inquiry launched into allegations over coal supply for Pakistan coal plant: An investigation has commenced into the coal supply contract for the 1320 MW Sahiwal coal plant that was funded as part of the China-Pakistan Economic Corridor. Three days before completing his role as acting Minister for Energy, Muhammad Ali detailed allegations of overcharging under the long-term coal supply contract entered into in 2022-23. Following objections from other suppliers, the National Electric Power Regulatory Authority switched supply to spot pricing, which resulted in a significant fall in the cost of imported coal. However, the original suppliers resumed coal sales at premium prices after the new suppliers were disqualified, allegedly on dubious grounds. The estimated overcharging could amount to as much as 50 billion rupees (US$179 million) over the last 18 months. (Pakistan Today, Business Recorder)

Indian officials reducing carbon tax on domestic coal: A panel of government officials has advised the Ministry of Coal to increase the carbon tax on imported thermal coal and reduce it for domestic supply. The officials proposed that the current carbon tax of 400 rupees (US$4.83) per tonne of coal should not be levied on volume but on coal price and quality. India’s domestic coal typically has high ash and low calorific values. India imported 176 million tonnes of coal in 2023, with South Africa, Indonesia and Australia supplying the bulk. India’s coal imports increased by almost ten per cent in 2023. The Minister for Coal, Pralhad Joshi, said India would have nearly 150 million tonnes of coal stockpiled by the end of March ahead of summer when power demand surges. (The Hindu, Economic Times)

Indian ministry calls for comments on coal gasification proposal: India’s Ministry of Coal has issued three draft requests for proposals for coal gasification projects from government-owned utilities and private companies with the aim of reducing imported gas, methanol and ammonia. The ministry is seeking comments by March 20 with the intent of issuing final requests for proposals by the end of the month. In 2021, the ministry proposed the goal of processing 100 million tonnes of coal or lignite for gasification and liquefaction by 2030. In January, the Modi government approved the expenditure of up to 85 billion rupees (US$1.02 billion) for coal gasification projects, with almost half earmarked towards the capital costs of three projects proposed by publicly-owned companies. (S & P Global, Ministry of Coal [Pdf])

UBS downgrades coal lending restrictions of Credit Suisse after merger: UBS has overturned the coal financing restrictions announced by Credit Suisse following the merger of the two banks. In mid-2023, UBS completed its takeover of Credit Suisse. In 2020, Credit Suisse announced financing restrictions, including a commitment to reduce its coal revenue thresholds from 25 per cent to 15 per cent in 2025 and 5 per cent in 2030. Companies with thermal coal or coal power revenue above the thresholds would be ineligible for loans or underwiting unless it was supporting the “energy transition”. UBS’s policy is to fund companies as long as their coal-related revenue does not exceed 20 per cent. UBS will release details on its new policy ahead of its annual general meeting on April 24. (Bloomberg, Finnews)

Green Steel Transition

Report finds Japanese banks dominate lending for metallurgical coal projects: A report by Reclaim Finance and Steelwatch has found that Japanese banks accounted for more than 29 per cent of funding for the development of metallurgical coal projects, excluding China, between January 2016 and June 2023. The groups found that four Japanese banks –  Mitsubishi UFJ Financial, Mizuho Financial, SMBC Group, and Sumitomo Mitsui Trust – have provided more than US$66 billion to the 50 biggest companies developing metallurgical coal projects for steel production. The report also found that Japanese investors, including the Government Pension Investment Fund, Mitsubishi UFJ, Nomura and Sumitomo Mitsui Trust, held US$25 billion in companies developing metallurgical coal projects as of June 2023. (Reclaim Finance)

Resources

“Collapse of Eskom power stations in photos”, BusinessTech, March 9, 2024.

This article features photos from the recently released VGBE Energy report illustrating poor maintenance practices at Eskom coal power stations.

“Veronica ‘Derek’ Cabe”, Global Witness, March 8, 2024.

For International Women’s Day, Rachel Cox profiled Veronica ‘Derek’ Cabe from the Nuclear and Coal-Free Bataan Movement in the Philippines as someone who has inspired her work in climate action.