Coal Phase-Out: First Global Survey of Companies and Political Entities Exiting Coal

CoalSwarm’s Global Coal Plant Tracker (GCPT) has completed the first global survey of coal phase-out plans by coal plant owners and political entities. The results show large numbers of companies and political entities exiting coal.

Of the 1,675 companies that have owned coal-fired power plants or pursued development of coal-fired power capacity since 2010, over a quarter (448 companies) have exited the coal power business entirely, with no current ownership and no further development plans.

Plans for developing additional capacity have declined even further. Nearly  70% (1,141) of the companies currently have no active plans for new power capacity, either in the pre-construction or the construction stage.

In additional to CoalSwarm’s survey of coal plant owners, a survey of political entities carried out by CoalSwarm and Greenpeace has identified 5 countries, provinces, states, and cities that have already phased out coal power, and another 18 planning a coal power phase-out by 2030 or sooner.

Reasons for shift

The findings of the ownership and political entity surveys coincide with other research reporting a shift away from investments in coal. This includes a survey by the UN Environmental Program showing overall coal- and gas-fired generation investments globally falling to less than half of non-hydro renewable investments.

Globally, the International Energy Agency’s World Energy Investment 2017 report found investments in coal power down by 20% and poised to decline further, with money flowing increasingly toward lower-cost solar, wind, and natural gas. A study by industry tracker Prequin found that investment in coal mining and coal power by private funds in North America “has completely dried up.”

According to a recent Institute for Energy Economics and Financial Analysis (IEEFA) report, the ability of renewables to outbid coal caused underperforming utilities to incur US$185 billion in lost revenues from 2007 to 2016.

For governments, coal phase-out plans have come in response to concerns over misallocation of resources in the wake of coal power overcapacity and falling utilization rates; public outcries over high levels of air pollution, especially in major Chinese and Indian cities; and growing pressure across civil society for decisive action on climate change.

A continued drop in coal power development

As of July 2017 the Global Coal Plant Tracker showed 548 gigawatts (GW) of coal power capacity in pre-construction planning and 264 GW under construction, a decline of 41% and 25% respectively from the levels reported in July 2016. These declines continue the trend documented in the CoalSwarm/Greenpeace/Sierra Club report Boom and Bust 2017 which reported a 48% percent decline in overall pre-construction activity, a 62% decline in new constructions starts, and an 85% decline in new Chinese coal plant permits during calendar year 2016.

Concentrated ownership

Of total coal power capacity in pre-construction development, 24% (130 GW) is concentrated among just 10 companies, and 34% (189 GW) among 20 companies, as shown in the figure below:

(“Announced” is the most preliminary stage; “pre-permit” refers to projects moving forward in securing permits or funding; and “permitted” refers to plants cleared for construction. Click here for a more detailed description of the status categories.)

Ownership of coal plants in the construction stage is more concentrated, with 45% (119 GW) of such projects owned by the top 10 entities, and 59% (156 GW) owned by the top 20 entities. (With Shenhua Group and China Guodian merging, the new company China Energy Investment Corporation will have by far the most coal capacity under construction, about 10% of the global total.)

Among the 681 companies seeking for the first time to develop coal power in the period from 2010 to 2017, 56% (378) have only shelved or cancelled projects, meaning they tried to build a coal plant and were not successful, and currently show no further plans to develop new capacity.

Accelerating retirements

Of the 1,675 companies surveyed, 59% (994) have owned coal-fired capacity since 2010, while 41% (681) have sought to develop coal plants.

Of the 994 companies that currently own coal plants or previously owned coal plants in the 2010–2017 survey period, 7% (71) have retired all their coal capacity, while 11% (112 companies) have retired at least one-third and 14% (139) have retired at least one-fifth of their coal power capacity.

Of the companies with legacy coal power fleets, 85 have retired at least half of their coal power capacity and abandoned any further expansion plans.

Countries and sub-national units exiting coal

To date, five countries, states, provinces or cities have officially phased out coal power since 2014, and an additional 18 have announced a coal power phase-out date of 2030 or sooner.

That number is likely to grow as entities with very little remaining coal power capacity follow the trend away from coal.

Among the entities planning a phase-out by 2030, only the UK has any coal projects in active development, a 570 MW carbon capture project that is struggling to attract financing.

Germany has also announced that it will phase out coal power by 2050, and is facing pressure to phase out coal sooner, in line with its Energiewende (Energy Transition).

Companies exiting coal

A number of high-profile companies have been moving to transition away from coal through canceling coal proposals and retiring coal capacity, often as part of a deliberate move toward clean energy. Some of the companies include:

AES: The US company has some proposed coal capacity in the Philippines, but is also planning  3.6 GW of new renewable capacity through 2020, raising its renewable capacity from 23% to 30% of its total power capacity.

Berkshire Hathaway: The US holding company’s MidAmerican Energy gets 48% of its generation from wind, with a goal of reaching 100% renewables.

DONG Energy: Danish Oil and Natural Gas (DONG) has reduced its coal consumption 73% since 2006, and plans to stop all coal use by 2023. DONG has also recently divested its oil and gas business as part of a plan to be a sustainable energy company under the new name Ørsted. 

Duke Energy: The US company has invested in 3 GW of new solar and wind capacity, with plans to invest US$11 billion in “cleaner generation,” including natural gas.

E.ON: As part of the German company’s plan to focus on renewables, E.ON put control of its fossil fuel assets under spin-off company Uniper in 2016. In the UK, Uniper has been fighting for guaranteed payments to make coal capacity available—similar to a recent proposal in the US. According to IEEFA, E.ON holds 47% of Uniper but is considering a quick sell-off of its holding in the face of large losses.

Enel: The Italian company plans to close all of its coal power assets by around 2030, including two large coal plants by 2018, and be carbon neutral by 2050. About half the power Enel generates is from non-carbon sources, including 36 GW of renewable and hydro capacity. 

Iberdrola: The Spanish multinational electric company has retired 82% of its coal capacity and has called off plans for nearly 4 GW of new coal capacity, while its renewable capacity has reached nearly 60% of its portfolio.

NextEra Energy: The company plans to build up to 16.5 GW of new wind and solar projects by 2020. In 2016 it bought the Indiantown coal plant with plans to shut it down, as it was cheaper than continuing to buy power from the coal plant under the purchase agreement.

NRG Energy: The US company has been steadily retiring its coal capacity as part of a strategic decision to move into a portfolio of renewable energy assets. In 2014, NRG publicly committed to achieving a 50% carbon reduction by 2030 and 90% by 2050.

Pohjolan Voima: Finland’s second-largest energy company retired its three coal plants between 2012 and 2015, and has no coal proposals, as the country moves to phase out coal by 2030.

PSEG: The US-based company has retired 77% of its coal capacity, and is planning to retire its last coal plant, with no plans for more coal.

Verbund: Austria’s largest electricity company has retired 83% of its coal capacity and now generates nearly all its power from hydroelectric plants, storage facilities, and wind turbines.

Full list of company coal power ownership

The full list of company coal power ownership is below. To sort the data, click on a column. The data is also available as a PDF.