July 23, 2020
Issue 331  |  View Past Issues

Editor's Note

Scandals and coal are all too frequently conjoined. In the US, the Speaker of the Ohio House of Representatives and four others have been arrested over a US$60 million slush fund used in part to campaign for a bailout for floundering coal and nuclear plants. In India, a state government has announced an inquiry into illegal coal mining in a protected reserve.

The ongoing COVID-19 crisis continues to disrupt the coal sector. In Europe Vattenfall has been forced to write down the value of the Moorburg coal plant in Germany by US$1 billion. In Portugal, the schedule for the closure of the last remaining coal plants has been accelerated. In Poland, the long-building financial crisis gripping the coal sector is coming to the fore with the government attempting to cobble a plan together to both slow and ease the transition away from a heavy reliance on coal.

A new report analysing the fleet of global coal plants notes that before the COVID-19 crisis most OECD and European Union 28 countries were already on track to exit coal power by the end of 2030. The report also notes the risk of countries with proposed projects ending up with stranded assets. BHP, one of the world’s biggest coal producers knows the feeling as it has discovered that it is now having a hard time selling it Mt Arthur coal mine in Australia.

Other coal projects are facing legal hurdles. In India, the National Green Tribunal has imposed an interim fine on NTPC over the collapse of a coal ash dam in Madhya Pradesh. In Canada, the federal Minister for the Environment has flagged he will reconsider whether to require a federal environmental assessment of a proposed mine expansion in Alberta.

Bob Burton


Poland's coal industry needs a radical overhaul

The Polish coal industry’s pre-existing problems have escalated into a major crisis as a result of the COVID-19 pandemic, writes James Shotter in the Financial Times.

How did coal sneak into Laos' energy plans?

After the Lao Government recently approved yet another coal power plant, one question looms large. In its thirst for foreign capital, has poor governance placed it at the mercy of rogue firms? asks Tim Ha in Eco-Business.

Coercion used to acquire land for Adani’s Godda power plant

Landowners objecting to Adani’s massive Godda power station in India were blocked from attending a public hearing on the project and then beaten by police, write Abir Dasgupta and Geoff Law in Adani Watch.

The Ohio bailout scandal: will FirstEnergy be charged next?

Federal prosecutors have charged the Speaker of the Ohio House of Representatives in a US$60 million corruption scheme. Will FirstEnergy Corp. be charged next?, asks David Pomerantz from the Energy and Policy Institute.


Portugal to end coal power by 2021

The Portuguese energy utility EDP has announced it plans to close its 1250 megawatt (MW) Sines coal plant by January 2021 asthe prospects for the viability of coal plants have drastically decreased.” EDP is investigating the possibility of establishing a green hydrogen project at the site. In October 2019, EDP announced that the Sines plant would operate until September 2023. EDP had also previously announced the closure of the 628 MW Pego coal plant by the end of 2021. Portugal had originally been aiming to close its coal power plants by 2030. Kathrin Gutmann, the director at the Europe Beyond Coal Campaign, said the accelerated retirement of the plants “shows just how fast a country can clean up its energy system when it commits to clean energy and climate action.” (Euractiv, EDP)

Top News

Corruption investigation results in arrest of Ohio MP over coal and nuclear bailout: The Republican Speaker of the Ohio House of Representatives, Larry Housholder, has been arrested along with four other lobbyists and Republican Party advisers and charged with racketeering over what a US Attorney described as "likely the largest bribery money laundering scheme ever perpetrated against the people of the state of Ohio.” The arrests follow a two-year Federal Bureau of Investigation inquiry into a US$60 million slush fund established by First Energy, a power utility, to buy political influence in the state parliament. A significant part of the funds were used to campaign for a bill that provided a US$1.3 billion bailout to two coal plants, two nuclear power stations and gutted the state’s renewables and energy efficiency mandates. There are growing calls for the bill, which also gained support from some Democrats, to be rescinded. (Cincinnati Inquirer, Cleveland.com, US Department of Justice, US District Court)

Report finds a majority of OECD and EU28 countries on track to be coal-free by 2030: An analysis of global coal plant data by the UK-based NGO E3G has found that at the end of 2019 56 countries already had no new coal projects under development, up from 52 in 2019. A further 14 non-OECD countries have no proposed new coal plants and could immediately commit to no new coal and consider phase-out pathways. The current closure schedules will result in 35 per cent of OECD and European Union 28 coal capacity closed before 2030 with a further six per cent slated for closure after 2030. There are proposals for 39,000 MW of new coal plants in the OECD and EU28 countries, with 81 per cent of the capacity in Turkey. (E3G)

Canadian Environment minister reconsidering Alberta mine expansion plan: Canada’s Minister for the Environment, Jonathan Wilkinson, is reconsidering his December 2019 decision to leave the environmental assessment of the proposed expansion of the Cline Group’s Vista mine to Alberta regulators. A coalition of 47 groups has requested Wilkinson overturn his initial decision due to the likely impacts of the proposed expansion. The Cline Group is seeking approval to expand thermal coal production from the current six million tonnes a year to between 13 and 15 million tonnes a year. The mine, which was commissioned in May 2019, produces only thermal coal. (CBC, Ecojustice)

Indian tribunal fines NTPC over coal ash spill: The National Green Tribunal (NGT) has ordered NTPC, a publicly owned utility, to pay interim compensation of 100 million rupees (US$1.3 million) for damage caused by the collapse of coal ash dam at the 4760 MW Vindhyachal Super Thermal Power Station in Madhya Pradesh. The failure of the dam on October 9, 2019 led to an estimated 3.5 million tonnes of coal ash flowing over farmlands and into the Rihand Reservoir. NGT Chairperson Justice Adarsh Kumar Goel castigated NTPC for refusing to accept the findings of an expert panel that inspected the site. In another case Goel has requested a report on a restoration plan and compensation due to the collapse of a coal ash dam at Vedanta’s 2640 MW Talwandi Sabo Power Plant in Punjab. (Livemint, Times of India)

Indian state orders investigation into illegal mining in reserve: The Assam state government has ordered a judicial inquiry into allegations that illegal coal mining had been undertaken in the Dehing Patkai Elephant Reserve since 2003. A legal case filed by a community activist revealed that North Eastern Coalfields, a subsidiary of Coal India, had illegally mined 44.27 hectares of forest reserve without approval and a further 41.59 hectares in another part of the forest between 2003 and 2012. Retired High Court Judge Brajendra Prasad Katakey is tasked with filing his report within six months. (Indian Express)

Most Indian coal plants stall on pollution control: The Centre for Research on Energy and Clean Air (CREA) estimates coal plants comprising less than one per cent of India’s 169,700 MW of coal capacity have been fitted with flue gas desulphurisation (FGD) units. CREA estimates only 24 per cent of coal plant capacity is covered by contracts for the installation of units to cut sulphur dioxide emissions. Seventy-two per cent of coal plant capacity is not yet covered by contracts to install FGD units despite the new pollution standards first being adopted in late 2015. (Times of India)

Indonesian coal company seeks to take over coal mine embroiled in corruption scandal: The government-owned PT Bukit Asam is seeking to take over the Tuhup mine in Central Kalimantan which is at the centre of a corruption investigation by the Corruption Eradication Commission (KPK). In February the founder of PT Asmin Koalindo Tuhup’s (AKT) parent company, Samin Tan, was named by the KPK as having allegedly paid Eni Maulani Saragih, a Golkar party politician, a 5 billion rupiah (US$341,000) bribe to lobby the Ministry of Energy and Mineral Resources. The KPK alleges the bribe was aimed at overturning the ministry’s decision to cancel AKT’s Tuhup mining permit. In May the KPK said that Tan had been added to its wanted list after not responding to two summonses relating to the case. (Jakarta Post)­­

“Poland really has no plan how to transition away from coal. And as long as it has no plan, there is the risk that some kind of shock therapy will occur,”

said Piotr Lewandowski, director of the Institute for Structural Research, a Polish think tank.


Germany: Traders estimate hard coal imports could decline by between 16 and 30 per cent in 2020 due to impacts of COVID-19 and the growth of renewables.

India: Supreme Court directs national government to reply to the legal suit filed by the Jharkhand government challenging the auctioning of coal blocks.

Indonesia: Government grants coal company permission to build an 88-kilometre haulage road through the Harapan forest in Sumatra.

Indonesia: A coalition of banks led by DBS has agreed to provide a 15-year loan for the 2000 MW Jawa 9 and 10 coal plants.

Mongolia: Coal exports over the first half of the year slump to 9 million tonnes, running well short of the government’s target of 40 million tonnes in 2020.

Mozambique: Vale’s coal production at its Moatize mine fell by 53 per cent in the second quarter 2020 compared to the same period in 2019.

Philippines: Government estimates coal demand to decline by up to 5 million tonnes in 2020 due to COVID-19.

South Africa: The Minister for Mineral Resources, Gwede Mantashe, has been hospitalised after testing positive for COVID-19.

Thailand: National Human Rights Commission finds an environmental impact assessment on a proposed coal mine misrepresented who had attended a public consultation meeting.

US: Environment groups flag legal action over stormwater pollution from a West Virginia coal storage and loading facility.

US: A coalition of states, environmental groups and the Northern Cheyenne Tribe has filed a new challenge against the Interior Department decision to open public lands for new coal leases and mines.

“We still think that metallurgical coal’s got a good future, but by 2035 it will be getting tougher there as well because the hydrogen technologies will be taking over in steel-making,”

said Vuslat Bayoglu the Managing Director of Menar, a South African mining company.

Companies + Markets

Vattenfall forced to write down the value of its new German coal plant: The Swedish utility Vattenfall has written down the value of its 1680 MW Moorburg plant in Germany by 9.1 billion kronor (US$1 billion) due to the combined effects of reduced demand and the growth of cheaper renewables. The plant was commissioned in 2015. Bruno Burger, a professor at the Fraunhofer Institute for Solar Energy Systems ISE, an energy research group, said the Moorburg plant generated 7.6 terawatt-hours of power in 2017 but had fallen to just 1.1 terawatt-hours so far in 2020. “For understandable reasons, fossil-fired power generation is especially exposed in today’s challenging market … A natural consequence of this is that the value of fossil-fired plants is decreasing,” said Magnus Hall, Vattenfall’s CEO. (Financial Post)

Samsung rules out support for Adani’s Australian coal project: Samsung Securities, a part of the South Korean headquartered Samsung Group, has ruled out providing further financial support for any of Adani’s coal projects. Samsung Securities, together with another South Korean company, jointly bought about US$84 million (A$120 million) in debt of Adani’s Abbot Point coal terminal in 2019 to sell to investors. Samsung ruled out further support for Adani coal projects the day after 15 young people from School Strike 4 Climate Australia protested outside a Samsung store in Sydney and called for a boycott of the company’s products. Samsung Securities said that the Adani project was its only coal investment and that after developing environment, social and governance investment guidelines it will determine a policy on future coal investments. Other divisions of Samsung, such as its construction and insurance arms, are involved with the construction of coal plants in South Korea. (Guardian, Korea Times)

BHP struggles to sell its Australian thermal coal mine: BHP’s is struggling to sell its Mt Arthur thermal coal mine in the New South Wales Hunter Valley after having rejected what it considers low bids from Adani’s Australian subsidiary and Yancoal, a subsidiary of the Chinese-headquartered Yanzhou Coal Mining Company. While Credit Suisse estimate the mine may be worth about US$1 billion, analysts argue that in the absence of major companies wanting to increase exposure to thermal coal BHP may have to sell it to private equity investors. BHP faces sustained investor pressure to divest from coal projects. BHP’s aim of reducing its thermal coal production seems to have reassured Norges Bank, which invests on behalf of Norway’s sovereign wealth fund. Norges Bank has increased its stake in BHP by 1.04 per cent to 5.1 per cent, a stake which is worth about $A4.07 billion (US$2.86 billion) at current prices. (Mining Weekly, Bloomberg, ShareCafe)

Gujarat Government cuts power price deals with Essar, Adani and Tata: In a setback for Adani Power, Essar Power and Tata Power, the Gujarat Government has revoked a December 2018 agreement to pay an increased power tariff to utilities hit by higher-than-anticipated costs of imported Indonesian coal. The decision affects the state power distributor’s (Gujarat Urja Vikas Nigam Limited – GUVNL) share of power from Adani Power’s 4620 MW Mundra plant and Tata Power’s 4000 MW Mundra plant and all of the generation from Essar Power’s 1,320 MW Salaya plant. A revised regulation has reduced the cap on imported Indonesian coal from US$110 per tonne to US$90 a tonne and eliminated the provision providing for an automatic reset of the ceiling price every five years. GUVNL is seeking approval of the Central Electricity Regulator to cancel its 2018 revised power purchase agreement with Adani Power alleging the company breached the condition requiring the “absorption of past losses by project developers.” (Livemint, Times of India)

Polish Government looks to merge state coal utilities: Leaked documents reveal that the Polish Government is considering merging state-owned utilities PGE, Tauron and Enea into a single company with their coal plants transferred to a new entity, the National Energy Security Agency (NABE). This would allow the new merged utility to focus on competitive energy generation while NABE oversees the closure of old coal plants. In mid-July the government said it had reached an agreement with the generators to buy coal from state-owned Polska Grupa Górnicza, the country’s largest coal company. Wojciech Dabrowski, the CEO of PGE, Poland’s largest power generator, has warned that that “if we do nothing in a year and a half, in two years we will bankrupt the company.” Dabrowski wants PGE to focus on the construction of offshore wind farms. The final European Union COVID-19 recovery agreement allows Poland to access 50 per cent of its potential funding from the €17.5 billion Just Transition Fund without requiring it to support the EU target of achieving carbon neutrality by 2050. (Warsaw Business Journal, Climate Change News)

Tata Steel looks to transform UK steel plant to lower carbon footprint: Tata Steel is investigating the closure of the two blast furnaces at its Port Talbot steel plant in Wales and their substitution with two electric arc furnaces. The company’s blast furnaces rely on imported metallurgical coal and iron ore while electric arc furnaces smelt recycled scrap and have far lower emissions. Tata Steel is seeking funding from the UK Government’s COVID-19 bailout fund. Liberty House, the steel company founded by British businessman Sanjeev Gupta, flagged its interest in working with Tata Steel to convert the Port Talbot mill to produce green steel. Liberty House failed in its bid to take over the plant in 2016 and has since been pursuing the development of a renewables-powered steel plant in South Australia. (Livemint, Hindu Business Line)


Coal and water conflicts in the American West, Energy and Policy Institute, July 2020. (Pdf)

This 40-page report documents the water supply risks facing coal plants in the American West as the climate changes and conflicts grow with other water users.

Global status of coal power: Pre-Covid19 baseline analysis, E3G, July 2020. (Pdf)

This 34-page report tracks countries’ progress towards an exit from coal power by 2030. It also identifies the countries that could readily commit to no new coal plants and begin planning to close existing plants.

Renewables beat fossil fuels: A half-yearly analysis of Europe’s electricity transition, Ember, July 2020. (Pdf)

This 12-page briefing paper provides an update on the power sector transition in Europe and finds renewable generation exceeded fossil fuel generation for the first time ever.