CoalWire 136, June 2, 2016

June 2, 2016

editor’s note

The transition away from coal is accelerating. New data reveals that China is already well ahead of its climate target, and in the Philippines the coal plant boom appears to be headed for a bust. In Colombia the constitutional court has cleared the way for a greater role for local and provincial governments in decision-making on mining projects while in India Adani’s plan to expand its massive Mundra plant has been rejected. Meanwhile Arch Coal has walked away from a proposed coal export terminal in the US, and companies that made big investments in new coal projects and infrastructure in Mozambique are now regretting their decisions.

Bob Burton

features

From Russia, with blood: the impact of coal exports to Britain

Open-cut coal mining in Russia is expanding, leading to growing environmental devastation and countless human rights abuses affecting indigenous peoples, writes Vladimir Slivyak, a co-chair of the Russian environmental group Ecodefense, in New Internationalist.

Tweet: From #Russia, with blood: the impact of #coal exports to Britain bit.ly/24hKwWs by @VladimirSlivyak @newint pic.twitter.com/zRjVXU8QwC

China is hitting its climate targets years ahead of schedule

China’s coal use and carbon dioxide emissions are going to keep falling much sooner and faster than anyone anticipated, writes Lauri Myllyvirta from Greenpeace in EnergyDesk.

Tweet: China is cutting coal & CO2 much sooner & faster than official targets suggest https://t.co/5eiL8LXQX1 via @energydesk

Bankrupt US coal giant walks away from US$60 million coal export investment

Arch Coal’s exit from the proposed Millennium Bulk Logistics Terminal in Washington state was a long time coming but signals US coal exports are now a losing bet, writes Clark Williams-Derry from the Sightline Institute.

Tweet: Arch Coal paid $60 million in #coalexport scheme, walked away with next to nothing @ClarkWDerry

campaigns

Philippines President directs review of coal plans

President Benigno Aquino III has directed the Climate Change Commission (CCC), a government agency, to undertake a review within six months of the country’s energy policy and outline an energy strategy consistent “with a low carbon development pathway.” The CCC resolution was signed into effect by Aquino – who chairs the agency – on May 18. It explicitly acknowledges the role of coal plants as the largest single human source of carbon dioxide emissions and emphasises the need to prioritise renewable energy and energy efficiency. It also stresses the need to review the environmental assessment process for new coal plants and ensure better integration between environmental and energy policies in relation to existing and new coal plants. (ABS-CBN News, Climate Change Commission)

Tweet: #Philippines President directs review of #coal plans & priority on #renewables & efficiency http://bit.ly/1TU7EsI http://bit.ly/1qZ2UWV

top news

Colombian court ruling opens mining role for local government: Colombia’s constitutional court has ruled in favour of a local government challenge against a 2001 law which blocked provincial and local authorities from restricting mining. The law also specified only the national government had the right to approve mining permits. The ruling, which has been criticised by the Colombian Mining Association – a member of the World Coal Association – opens the prospect that local and provincial governments could block coal and other mining operations on environmental or other grounds. (Reuters)


Adani’s Indian plant expansion plan rejected: A Ministry of Environment and Forests (MoEF) advisory committee has rejected Adani’s plan to add a further 3000 megawatts (MW) of coal capacity at its existing 4620 MW Mundra plant. The committee noted the expansion site is close to a sensitive creek and estuary network, reserved forest and nine villages. The committee noted the Mundra area is already “under stress” from the existing Adani plant as well as from the nearby 4000 MW Tata Mundra plant and suggested Adani seek an alternative site. (Times of India)


Mitsubishi settles WW2 coal mine slavery claims: Mitsubishi Materials has agreed to pay US$15,000 to each of the families of 3000 Chinese coal miners who were taken to Japan during World War Two and forced to work in 10 company coal mines. It is estimated that 40,000 Chinese worked in the mines, with many dying due to the harsh conditions. Mitsubishi has issued an apology and promised to try and locate all the victims and their families. (The Standard, Deutsche Welle)

Human rights group condemns Bangladesh crackdown: The Asian Human Rights Commission (AHRC) has expressed alarm at a May 16 raid by armed police on Gondamara Village in Chittagong, the centre of opposition to the proposed 1320 MW Banshkhali plant. Fifteen residents sustained bullet wounds in the raid with a further 30 subject to torture as part of a police crackdown on opposition to the plant, proposed by the S Alam Group. The AHRC also reports that police arrested the father of the leader of a local citizens’ group. (Dhaka Tribune, Asian Human Rights Commission)


Japan approves new plants and brokers coal deal with India: Japan’s Minister for the Environment, Tamayo Marukawa, has approved two proposed coal plants with a combined capacity of 1295 MW despite her earlier opposition to them. The decision, which comes ahead of Japan hosting the G7 meeting in late June, was described as “outrageous” by Kiko Network. Japan has also signed a Memorandum of Understanding with the Indian Government to promote “low-carbon” coal plants in India. (Bloomberg, Business Standard)

news

Australia: Modelling reveals underground Glencore mine drained World Heritage lake system.


Germany: European Commission clears US$1.8 billion subsidy for closure of eight plants.

Philippines: Toyota seeks increased stake in company pushing Mindanao coal plants.


South Korea: Government drafting plan to curb pollution by closing plants over 40 years old.

companies + markets

Analysts expect seaborne export market to keep falling: Coal industry analysts are predicting that the increase in India’s coal import duty will prompt a switch to higher grade supplies. Adani Enterprises CEO, Vinay Prakash, told the conference that lower quality coal would have to become even cheaper relative to higher quality coal “to make economic sense for Indian importers.” Adani’s proposed Carmichael mine in Australia would export low quality coal. Indonesia estimates coal production could fall by 42 million tonnes to 419 million tonnes this year with exports dropping by 58 million tonnes to 308 million tonnes. (Platts)


Europe clears Spain’s plan to close 26 mines: The European Commission has ruled the payment of US$2.4 billion to underwrite the closure of 26 uncompetitive coal mines by the end of 2018 is consistent with European Union rules against state aid for ongoing mining operations. In 2014 Spain’s total coal production was only 4 million tonnes with imports in 2015 of about 19 million tonnes. (Platts, European Commission)


Pakistan power projects falter:  China Machinery Engineering Corporation has dropped its proposal to build a 330 MW plant near Pind Daden Khan in Punjab after failing to get a guaranteed power tariff over one-third higher than allowed by the National Electric Power Regulatory Authority. A dispute has also stalled a proposed US$2.1 billion 878-kilometre 4000 MW high voltage transmission line from Matiari to Lahore. The China Electric Power Equipment and Technology Company is demanding Pakistan’s National Transmission & Despatch Company pay for the use of the full capacity of the line over 25 years from the date of commissioning, even if less electricity is dispatched. (Daily Times, The News)

Coal India explores exports to Bangladesh: Coal India is negotiating to supply coal to Bangladeshi power producers in a bid to cut pithead stockpiles and open up a new market. The company, which produces about 80 per cent of India’s coal, is investigating exporting coal from the port at Haldia in West Bengal, a move that would undercut potential Indonesian suppliers who provide lower-quality coal and have higher freight costs. Coal India has not previously exported coal on a commercial basis. (Economic Times)


Coal India hikes prices as glut hits profits:Coal India has increased coal prices by an average of 6.3 per cent with the cost of power sector grades increasing by 13.4 to 18.75 per cent. The company has increased the price of lower grade coal to boost profitability while cutting the cost of higher grade coal to make it more competitive against imported coal. It is estimated the variable cost of power generation may increase by nine per cent. The changes are likely to accelerate the fall in coal imports and enhance the competitiveness of new solar and wind projects. (Bloomberg, Economic Times)


Cutbacks continue on Mozambique’s coalfields: Layoffs and production cutbacks at mines near Moatize, once tipped as one of the next big coal boom sites, have expanded to include the cessation of mining at Jindal Africa’s 850,000 tonnes-per-year mine. Vale has cut production at its Moatize mine, Beacon Hill Resources – which has the Minas do Moatize mine – is bankrupt and the Benga mine belonging to the Indian consortium International Coal Ventures stopped mining at the start of the year pending finding a cheaper mining contractor. (Macauhub)

resources

An Audit of Compliance and Enforcement in the Mining Sector, Auditor General of British Columbia, May 2016. (Pdf)

This 109-page report provides a damning critique of the poor regulation and inadequate environmental enforcement of British Columbia’s mining industry. The audit report finds unfunded mine rehabilitation liabilities in the province amount to over US$920 million, with Teck’s coal mines accounting for about 60 per cent.


Gulag, Inc.: The Use of Forced Labor in North Korea’s Export Industries, Committee for Human Rights in North Korea, May 2016. (Pdf)

The 62-page report documents the use of forced and slave labor in the mining of coal and other minerals in North Korea. (Coal exports, mostly to China, represent about half the country’s exports and are a major source of foreign exchange.)

 

 

Climate Change: Closing the COP21 Gap by Going Solar: Global – US – Germany – The Netherlands – Belgium – Japan, REC Solar Holdings, May 2, 2016. (Pdf)

This set of PowerPoint slides presents the results of modelling by the Norwegian solar company REC on the scale of solar deployment required – along with wind in Germany – to displace coal and meet the Paris Agreement target of no more than a 1.5 to 2 degrees global temperature increase.