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June 15, 2023
Issue 470  |  View Past Issues
CoalWire
Published by Global Energy Monitor

Editor's Note

The Polish government could have treated a recent court ruling suspending the approval of the expansion of PGE’s Turow lignite mine near the borders of Germany and the Czech Republic as an off-ramp from the controversial project. Instead, the government seems determined to press on despite the ruling. Poland is also under pressure on another front. Germany’s Minister for the Environment wants coal mine wastewater emissions into the Oder River suspended over summer months to avoid a repeat of last year’s mass fish kill caused by an algal bloom. So far, Poland has baulked at cutting emissions. Meanwhile, residents of the Polish port city of Gdansk are alarmed by coal dust pollution from the country’s coal imports.

The latest costs data compiled by Bloomberg New Energy Finance (BNEF) highlight that new onshore wind and solar remain far cheaper than coal projects. BNEF also highlighted the dramatic decrease in the cost of offshore wind generation to the point that it is on a par with new coal power. For countries facing decisions on new generation capacity, the latest data underscores the risk of projects locking in either losses for sponsors or expensive power for consumers. In its latest report on the Philippines, the World Bank models the cost of an accelerated transition to renewables and finds it is viable if financial support can be provided for the early retirement of stranded coal plants.

Bob Burton

Features

What is causing the record rise in China’s coal production and imports?

The surge in China’s coal imports and a sharp increase in domestic coal production reflects a response by buyers to the increased cost and declining quality of local domestic coal, writes Lauri Myllyvirta from the Centre for Research on Energy and Clean Air.

‘Black city’: Polish port Gdansk chokes on coal dust

The surge in coal imports from Kazakhstan, Colombia and Indonesia has driven a rise in coal dust pollution, blighting residential areas in the Baltic ports of Poland, writes Magdalena Paciorek in France 24.

The right-wing war on clean air

Steve Milloy, a longtime lobbyist for polluting industries from tobacco to coal to oil and gas, appeared on Fox News to tell people that there are “no negative health impacts” from breathing in wildfire smoke that recently blanketed the US east coast. It’s the latest salvo in a war he’s been waging against air pollution regulation since the 1980s, writes Amy Westervelt in The Intercept.

Top News

Court suspends approval of Polish mine expansion: A Warsaw provincial administrative court has ordered the suspension of the expansion of the Turow lignite mine beyond 2026 due to concerns about the environmental impact of the mine. The EKO-UNIA Ecological Association, Greenpeace, the Frank Bold Foundation and the town of Zittau argued that PGE’s report on the environmental impact assessment of the mine expansion was seriously flawed. Despite the ruling, Prime Minister Mateusz Morawiecki vowed the government would keep the mine operating and declared that “no courts, whether from Brussels or Warsaw, will dictate to us what is meant by Poland’s energy security.” On 17 February 2023, the Polish Ministry of Climate and Environment permitted the mine to continue operating until 2044. Radosław Gawlik from the EKO-UNIA Ecological Association said the failure of the government and PGE to plan the transition away from coal in the Bogatynia-Zgorzelec region has already meant the area has missed out on a billion zlotys (US$234 million) in European Union funding for a just transition. (Euractiv, Frank Bold Foundation [Polish])

Germany wants Poland to suspend mine discharges into the Oder River: Germany’s Minister for the Environment, Steffi Lemke, wants Poland to curtail discharging coal mine wastewater into the Oder River during the summer months. Over July and August 2022, a golden algae bloom caused the death of hundreds of thousands of fish in the Oder and Vistula rivers. Canals connect the two rivers. Poland claimed the fish kills were natural, but water testing by Greenpeace Poland found salinity levels in the Vistula River increased by 25 times downstream of tributaries carrying wastewater from Upper Silesia’s hard coal mining areas compared to water immediately upstream. Lemke said recent testing indicated high salinity levels in the Oder remained a problem. Polish Environment Minister Anna Moskwa said she couldn’t rule out a reoccurrence of last year’s blooms of golden algae. (ABC News)

Germany and US alarmed over arrests of Vietnamese civil society leaders: The German government, one of the funders of the US$15.5 billion Just Energy Transition Partnership with Vietnam, has expressed concern over the arrest of climate advocate Hoang Thi Minh Hong on tax-related charges. Both Germany and the US emphasised the vital role of civil society groups in addressing climate change. Hong’s arrest followed an agreement to accelerate Vietnam’s transition away from coal and the release on May 15 of Nguy Thi Khanh, a clean energy advocate imprisoned for over a year on tax charges. The United Nations Human Rights Council Working Group on Arbitrary Detention has also expressed concern about Dang Dình Bach from Hanoi’s Law and Policy of Sustainable Development Research Centre. Bach has been imprisoned since June 2021 and is serving a five-year term for contact with foreign organisations and alleged breaches of the tax code. He is currently on a hunger strike. Bach documented complaints by some of the 91,000 people displaced by a hydroelectric project as part of his legal work. (AP, United Nations Human Rights Council,  Working Group on Arbitrary Detention [Pdf], BBC [Vietnamese])

Subsidies set to climb for two coal plants at the centre of Ohio scandal: Subsidies will resume in July for two coal plants provided for in the scandal-tainted House Bill 6 (HB6) adopted by the Ohio legislature in July 2019. Filings by utilities indicate Ohio consumers could pay up to US$38 million over the next six months. The US$61 million campaign by a dark money group called Generation Now culminated in legislation bailing out two nuclear plants. HB6 also provided subsidies for Ohio Valley Electric Corporation’s (OVEC) 1086 megawatt (MW) Kyger Creek Station coal plant in Ohio and the 1304 MW Clifty Creek power plant in Indiana. Until recently, OVEC bought coal from Resource Fuels, an affiliate of donors to Generation Now. In March, a memo to the Ohio Manufacturers Association by energy consultancy Runner Stone estimated the subsidies from HB6 and the Public Utilities Commission of Ohio for the two coal plants had already cost electricity consumers US$400 million since 2017 and could amount to US$845 million by 2030. The bailout for the two nuclear plants has been repealed. (Energy News Network, Runner Stone [Pdf])

South Africa looks to China to help end load shedding: South Africa’s Minister for Electricity,  Kgosientsho Ramokgopa, said he would lead a delegation to China in the coming weeks in a bid to secure access to cheap solar panels, wind turbines and battery storage to assist in a rapid rollout of renewables capacity. Ramokgopa said most of the 5500 MW of proposed capacity in the next few years would come from solar installed on houses and government buildings. In a separate development, the pro-coal Minister for Mineral Resources and Energy, Gwede Mantashe, criticised the economic impact of the closure of Eskom’s 900 MW Komati coal plant. The last 100 MW unit at the plant shut down late last year. Mantashe was critical of Eskom’s Komati transition project, which includes a 150 MW solar farm, 70 MW of wind capacity and 150 MW of battery storage, on the grounds they haven’t provided the same number of jobs as the coal plant. Eskom said it had employed 661 people at Komati, of which 237 were permanent staff. The transition project currently employs 150 permanent employees. (Reuters, News24)

Indian government approves Goa port expansion: India’s Ministry of Environment, Forest and Climate Change has granted environmental approval for a subsidiary of JSW, South West Port Limited, to double the capacity of its coal terminal at Mormugao Port. Civil society groups have opposed the proposed expansion for years and objected to coal dust and other pollution from the existing coal terminal operations. The Indian government has also approved the expenditure of 29.8 billion rupees (US$362 million) to 2025/26 on further exploration of coal and lignite basins to facilitate the sale of more coal blocks to private companies. (Herald Goa, Deccan Herald)

News

Bangladesh: The privately-owned 1320 MW SS power plant in Banshkhali has shut down due to the lack of coal supplies.

India: Coal Secretary Amrit Lal Meena said the government is open to offering land in eastern coal areas for coal-to-hydrogen projects.

Japan: The sudden shutdown of Hokkaido Electric’s 600 MW No 2 coal unit at the Tomatouatsuma power plant on June 11 was due to an offshore earthquake.

Mongolia: The first coal shipment by rail from Mongolia’s capital Ulaanbaatar arrived at Caofeidian port in northern China.

US: A court has approved a settlement between the state of Illinois and Dynegy Midwest Generation requiring the excavation of coal ash from leaking impoundments and its relocation to a new lined landfill site.

US: Black Diamond Coal Company was fined US$200,000 and an employee sentenced to six months in prison with a further six months home detention after being convicted of submitting falsified coal dust-sampling results from a Kentucky mine.

Companies + Markets

Renewables beat new-build costs for coal in most countries: Bloomberg New Energy Finance (BNEF) estimates the cost of electricity from new onshore wind projects at US$42 per megawatt-hour (MWh) and solar farms at between US$44-48 per MWh. BNEF said solar and onshore wind projects remain the cheapest source of new generation in countries accounting for 82 per cent of global electricity generation. BNEF estimates that the levelised cost of energy from new coal plants is US$74 per MWh, on par with offshore wind generation. BNEF estimates electricity from a coal plant with carbon capture and storage equipment costs US$124 per MWh. The report notes that renewables projects have been affected by the decisions of central banks to raise interest rates and that recent cost declines have not been passed to customers by some manufacturers. (Recharge, BNEF)

World Bank models accelerated transition for the Philippines: The World Bank’s Philippines Economic Update argues that the country would benefit from a more ambitious transition of the power sector to renewables but that this would require financial support. The Philippines currently has about 11,000 MW of operating coal plants, with a further 2640 MW which are under construction or could proceed. The current government commitment is to cap coal capacity by 2025 and generation by 2030. The World Bank proposes an accelerated decarbonization scenario in which less than 3000 MW of coal capacity would still operate by 2040. The current government policy would result in about 14,000 MW of coal capacity remaining online in 2040. The report estimates the losses due to stranded assets would be about US$10 billion, with coal capacity reduced from 2028. The Philippines currently imports about 80 per cent of its coal. Under an accelerated transition scenario, the cost of air pollution damage would decline by about 32 per cent or US$4.7 billion a year. (Manila Standard, Philippine Star, World Bank)

Glencore pitches plan to takeover Teck’s coal mines: Glencore has proposed the cash purchase of Teck Resources’ metallurgical coal assets in Canada and committed to spinning off a company with the combined coal projects of the two companies within a year or two. Glencore, which has thermal coal mines in Australia, Colombia and South Africa, is the world’s largest thermal coal exporter producing just over 100 million tonnes of coal in 2022. Teck Resources, which produces almost 30 million tonnes of coal annually, is the world’s second-largest exporter of metallurgical coal after BHP. In April, Glencore offered to pay US$8.2 billion for Teck’s coal assets as part of a proposal to buy the entire company. Teck had proposed spinning off its four coal mines and related assets into a new company, Elk Valley Resources, and appointed former British Columbian Premier John Horgan to the new company’s board. Teck Resources said Glencore’s latest proposal is “preliminary in detail, conditional and non-binding”, and that other companies had also expressed interest in the company’s coal assets. (Financial Times, Glencore, Teck Resources)

Vietnamese province wants coal conveyor built from Laos: Provincial government officials of Quang Tri in central Vietnam want central government support to build the world’s longest conveyor system to boost coal imports from Laos. The current capacity of coal imports by road from the Sekong and Salavan provinces in Laos to Quang Tri province in Vietnam is about 2 million tonnes annually. Quang Tri provincial officials want to increase coal imports from Laos to 15 to 20 million tonnes yearly for domestic use and export. The 160-kilometre-long conveyor system would comprise an 85-kilometre-long section from the coal mines in Laos to the La Lay border crossing and a 75-kilometre section to a proposed seaport at My Thuy. (VNExpress)

Republican states embracing anti-ESG restrictions: Bloomberg New Energy Finance estimates that 15 US states have now adopted legislative measures to punish financial services firms that apply environmental, social, and governance criteria to screen clients seeking support. Similar legislative measures are under consideration in a further 12 states. The states aim to ban or limit the ability of financial services firms to win contracts if they restrict financing for fossil fuel projects. Oklahoma recently compiled a list of 13 financial institutions, including JPMorgan, that were accused of boycotting oil and gas companies. JPMorgan responded by insisting that it remains “among the top financers across the energy sector, including traditional energy sources.” Just as financial institutions risk losing business, states are likely to face higher costs on funds. Six states – West Virginia, Kentucky, Indiana, Montana, Utah, and Wyoming – have also passed or are considering legislation that would make it more difficult for utilities to close coal plants, allow cost-recovery from consumers for federal anti-pollution measures and allocate public funds for legal cases to protect coal plants. (BloombergNEF, CNN)

Resources

2030 targets aligned to 1.5°C: evidence from the latest global pathways, Climate Analytics, June 13, 2030. (Pdf)

This 22-page report outlines pathways that can meet the Paris Agreement goal of limiting global temperature increase to 1.5°C without relying on unlikely levels of carbon dioxide removal. The report estimates coal use in the power sector needs to decline by 79 per cent this decade.

“Coal Costs 2008-2023”, Tableau, June 9, 2023.

This charting tool, built by Jeremy Fisher at the Sierra Club, uses US Energy Information Administration data and allows users to select a coal-fired power plant in the US and chart the cost of delivered coal from individual mines.