May 9, 2019
Issue 274  |  View Past Issues

Editor's Note

One of the contributing factors behind the slide in public support for new coal power and mining is the never-ending string of scandals. Events over the last week are a good example of the widespread problems, especially in countries with a big, politically powerful coal industry. In Indonesia, the Corruption Eradication Commission spent hours interviewing the head of the country’s power utility, PLN, over bribes allegedly paid to win approval for a new coal plant. In South Korea, a subsidiary of Hyundai has admitted paying bribes to another Indonesian official to counter protests against the construction of a new coal plant. In Malaysia, the former Prime Minister has been before a court defending charges that he embezzled funds notionally allocated for a coal project in Mongolia. In the US, the Department of Justice has launched legal action to recover millions of dollars in unpaid fines levied against companies owned by Jim Justice, a coal billionaire and the Governor of West Virginia.

With poor public standing of coal and improving economics of renewables, major financial institutions continue to pull back from coal. In Norway, the public sector pension fund manager has tightened its divestment threshold and dumped more coal stocks. A spokesperson for the ruling Conservative Party has also referred to coal stocks as “a toxic investment.” Faced with growing community pressure the Italian insurance company Generali has ruled out support for a controversial coal mine in Poland, though important details remain to be clarified. In the US, over 40 per cent of Duke Energy shareholders voted to support a resolution demanding more detail on how the company intends to mitigate public health risks with its coal ash dams.

Bob Burton


Coal has uphill battle in key countries

Strong public support in key countries for clean energy rather than coal power poses a growing risk for coal investments, writes Nathanial Bullard in Bloomberg.

Can Poland wean itself off coal?

The backlash against a proposal by the state-owned company PGG to mine directly under the town of Imielin is consistent with a softening of public support for Poland’s heavy reliance on coal, write James Shotter and Evon Huber in the Financial Times.

Inside America's most polluted coal ash site and industry's struggle with federal rules

The problems with pollution from the coal ash dams at the San Miguel power plant in Texas are symptomatic of the significant costs of proper long-term waste management that all utilities are having to face up to, writes Catherine Morehouse in Utility Dive.

Top News

Indonesian power utility boss named as corruption suspect over coal plant contract: Indonesia’s Corruption Eradication Commission (KPK) has named Sofyan Basir, the chief executive of the state-owned power utility PLN, as a suspect in an investigation into corrupt payments associated with the approval of the 600 megawatt (MW) Riau-1 coal plant in Sumatra. The KPK alleges Sofyan accepted a bribe on a par with the US$333,629 paid to former House of Representatives member Ms Eni Maulani Saragih by a shareholder of a Singapore-listed coal mining company BlackGold Natural Resources. Eni was a member of the parliamentary oversight committee for energy policy who has been sentenced to serve four-and-a-half years in prison. While the Riau-1 project has been suspended, the Ministry of State-Owned Enterprises insists other power projects approved by PLN should be unaffected by the case against Sofyan. (Mongabay, Tempo, Jakarta Post)

Malaysian court told funds for Mongolian coal mine diverted to ex-PM’s bank account: The Kuala Lumpur High Court hearing on corruption charges against former Prime Minister Najib Razak has been told that Malaysia's civil services pension fund KWAP loaned RM4 billion ringgit (USS$1.3 billion) to SRC International ostensibly to buy coal mines in Mongolia. SRC International was a former unit of 1Malaysia Development Berhad (1MDB), a sovereign wealth fund. The scandal over looting of 1MDB funds was one of the key factors leading to Razak losing the 2017 election. Razak has been charged with abuse of power for accepting a 42 million ringgit (US$10.1 million) bribe to authorise government guarantees for the transfer of KWAP funds from to SRC. Najib has denied any wrongdoing. (The Straits Times, New Straits Times)

US Government sues coal companies owned by West Virginia Governor’s family: The US Department of Justice (DoJ) has launched legal action against 23 coal companies owned by the family of West Virginia Governor Jim Justice over US$4.7 million in unpaid fines for violations of the Federal Mine Safety and Health Act. The fines relate to over 2,297 safety violations between May 3, 2014 and May 3, 2019 at mines operated by the companies. The DoJ alleges the Justice companies have not responded to demands by the Mine Safety and Health Administration, the Department of Treasury or the United States Attorney’s Office for the payment of the fines. Jim Justice, a billionaire coal baron who was elected in November 2016 as Governor of West Virginia, has stated that the day-to-day management of his coal companies has been handed over to his son, Jay Justice. (Charleston Gazette-Mail, Department of Justice)

Hyundai admits bribing Indonesian official: The South Korean company Hyundai Engineering & Construction has admitted to Korea Times that it paid a bribe via an agent to Sunjaya Purwadisastra, the Regent of Cirebon province, to end protests against the construction of a new 924 MW coal unit at the existing Cirebon plant. Hyundai said that it paid 6.5 billion rupiah (US$460,000) to an agent for Sunjaya who had requested a payment of 9.5 billion rupiah (US$663,000). “For us, it is critical to finish the construction on time; otherwise, we could face a heavy fine. So we gave him money,” a Hyundai official stated. A subsidiary of the state-owned Korea Electric Power Corporation is financing the project. In October 2018, Indonesia’s Corruption Eradication Commission arrested Sunjaya over the alleged bribe. (Korea Times)

Indian minister downplays air pollution health toll: India’s Minister of Environment, Forest and Climate Change, Harsh Vardhan, has sought to dispute the findings of a recent Health Effects Institute study that estimated 1.2 million premature deaths in India were caused by air pollution in 2017. Vardhan acknowledged that air pollution does cause health impacts but said the coverage of the report had created “a panicky situation”. Vardhan is seeking re-election for the ruling nationalist Bharatiya Janata Party to a seat in New Delhi, one of India’s most polluted cities, in the May 2019 national election. Unlike the 2014 national election, the major national political parties have included policies to address air pollution in their campaign manifestos. (The Hindu, Bloomberg)

Adani’s plan to manage endangered finch rejected: The Queensland Government has told Adani that its proposed management plan for the endangered black-throated finch is inadequate and needs to be revised. The largest remaining population of the finch lives within Adani’s Carmichael coal mine lease. The finch management plan is one of the two remaining government approvals needed before the company can begin construction. The Queensland Department of Environment and Science said that Adani could gain approval by committing to undertake additional actions to address the concerns raised about its draft management plan. While Adani has repeatedly claimed it has scaled its project down to 10 million tonnes a year, it has refused to rule out expanding to the 60 million tonnes a year first proposed. (Guardian, The Conversation, Guardian)

South African groups launch High Court action over gutted pollution standards: A coalition of environmental groups has launched a legal challenge against the October 2018 decision by the Minister for Environmental Affairs, Nomvula Mokonyane, and President Cyril Ramaphosa to double the allowable levels of sulphur dioxide emissions from major industrial plants after April 1, 2020. The groups argue the government’s decision to increase the minimum emission standard to 1000 milligrams per cubic metre is in breach of the provisions of the Air Quality Act which require any proposed changes disclosed in a sufficiently detailed way to allow citizens to submit meaningful representations or objections.” The groups argue the new sulphur dioxide standards are about 10 times weaker than Indian standards and about 28 times weaker equivalent standards in China. groundWork, Center for Environmental Rights)

“Coal is sinking — a toxic investment being propped up not because it has a future but simply so those heavily invested can eke out the last dollar before jumping ship,”

writes Lene Westgaard-Halle, a spokesperson for Norway’s ruling Conservative Party.

“#Coal is sinking - a toxic investment being propped up not because it has a future but simply so those heavily invested can eke out the last dollar before jumping ship,” says Lene Westgaard-Halle, a spokesperson for #Norway’s Conservative Party #lignite


Canada: SaskPower concedes carbon capture target for troubled Boundary Dam plant will be missed.

Kosovo: General Electric named as preferred bidder by ContourGlobal for the proposed 500 MW Kosovo C plant.

Greece: PPC, the government owned power utility, has set a May 28 as deadline for bids for three lignite plants after earlier sale process abandoned.

US: Trump nominates Kelly Craft to be US Ambassador to the United Nations despite potential coal conflicts.

Companies + Markets

Norwegian pension fund manager dumps more coal investments: The major Norwegian public sector pension fund manager, KLP, has adopted a coal policy that excludes investments in any company that generates over five per cent of revenue from coal-based activities. KLP’s Chief Executive Sverre Thornes stated that “coal cannot and should not be part of energy supply in the future.” By way of implementing the new policy KLP has sold off US$366 million of investments in 46 companies, including leading miners BHP and Anglo American. (Reuters)

Generali ending support for Polish coal mines: At its annual general meeting the Italian insurance company Generali announced that it would no longer insure PGE’s Turów coal mine or any other coal mine in Poland. PGE is seeking to expand the mine, which is currently scheduled to close in 2020, to allow it to operate until 2045. Generali also announced that it had ended support for two unspecified companies it had been discussing its 2018 climate policy restrictions with. Generali continues to provide support to a further four companies, including PGE and CEZ, because it considers they are moving to diversify their energy mix. Unfriend Coal called on Generali to end its support for all companies developing new coal projects. (Unfriend Coal)

Big vote by Duke Energy shareholders for coal ash disclosure: A shareholder resolution calling on Duke Energy to produce a report outlining how it intends to mitigate public health risks with its coal ash dams was supported by 41 per cent of shareholders. As You Sow, a corporate accountability non-profit group, said the strong support for the resolution demonstrated a lack of confidence by many shareholders in the company’s approach. While shareholder resolutions on coal and climate issues are gathering support, major energy companies are seeking to challenge the filing of resolutions before the US Securities and Exchange Commission which is now dominated by appointees of President Donald Trump. (As You Sow, Inside Climate News)

European Commission flags funds on offer for coal transition in Poland: Speaking at an Association of Polish Trade Unions conference, the European Commission’s First Vice-President Frans Timmermans said that the European Union should help develop a plan to support a transition away from coal especially in Poland and Slovakia. “We want to make this a transition that works for Polish workers. We have to have a plan and have to have a lot of European money too,” Timmermans said. Coal power generates about 80 per cent of Poland’s electricity with the conservative national government supporting the construction of new lignite plants. The Upper Nitra region in Slovakia has been adopted as one of the three pilot projects in the European Commission’s Platform for Coal Regions in Transition. With coal power only contributing about 12 per cent of Slovakia’s electricity, senior ministers have canvassed an end to subsidies for coal mining and power by 2023. (Reuters)

US utility faces more costs with failed Carbon Capture and Storage plant: Southern Company has disclosed that the outcome of a US Department of Justice investigation into the failed coal gasification plant at the Kemper power plant could have a significant impact on the company’s financial position. The 682 MW plant in Mississippi was originally intended to be operated as a plant which gasified lignite for power generation and captured part of the carbon dioxide emissions to boost oil production. However, the cost of building the plant blew out from US$2.9 billion to US$7.5 billion resulting in the energy regulator ordering that the plant be run solely on network gas and the coal mine and gasification plant be scrapped. Southern Company has also revealed that it may be required to remove the 60 mile-long (97 kilometres) pipeline constructed to carry compressed carbon dioxide from the Kemper plant to nearby oilfields. Southern Company has warned shareholders that the cost of removing the pipeline “could have a material impact” on its financial position. (Utility Dive, Southern Company)

ANC seeks to make it mandatory for South African pension funds to back coal: The African National Congress’s (ANC) head of economic transformation, Enoch Godongwana, has proposed that South Africa’s pension funds should be compelled to invest in new coal mines. The ANC’s national platform flags the possibility of requiring pension funds to finance development projects but, unlike Godongwana, does not specifically mention coal mines. South Africa’s pension funds have an estimated US$277 billion under management. Eskom has complained that new coal mines aren’t being developed fast enough to cater for its new coal plants under construction. Standard Bank and Nedbank have ruled out support for new thermal coal plants. (Bloomberg)

Zimbabwean coal mining company’s losses grow: The financial positon of Hwange Colliery Company Limited (HCC), a partly government-owned Zimbabwean coal mining company, dramatically worsened in 2018, racking up a loss US$78.4 million. In 2017 the company recorded a loss of $43.8 million. The Hwange mine is the sole supplier to the Hwange power station, the country’s only coal plant, which is owned by Zimbabwe Power Company (ZPC). ZPC began construction of a 1340 MW expansion of the existing plant with funding from the Export–Import Bank of China in mid-2018. However, HCC complains that its ability to meet the 25-year coal supply contract for the expansion is uncertain as the government has not renewed some of the mining leases it previously held. (Business Day, Mining Weekly, Global Energy Monitor)


Dirty Power: Big Coal’s network of influence over the Coalition government, Greenpeace Australia Pacific, May 2019. (Pdf)

This 28-page report investigates the network of coal companies, industry lobby groups, lobbyists and media commentators and their influence on the current Australian Liberal National Party Government.