Renewable energy will win in post-coronavirus world
The impact of the coronavirus is likely to alter the energy landscape long after the crisis passes if renewables seize the moment, writes Clyde Russel in Reuters.
Doosan Heavy Industries should not receive public funds
Investing public funds to prop up Doosan Heavy Industries’ coal power business in South Korea will be no more than a pardon for poor business decisions at the expense of other more deserving companies, writes Matt Gray in the Korea Herald.
Limpopo’s dirty great white elephant
The South African Government’s plan to develop a 40 billion rand (US$2.2 billion) Chinese-controlled energy and metallurgical industrial complex at the Musina-Makhado Special Economic Zone in Limpopo is founded on quicksand, writes Sam Sole in the Daily Maverick.
Egypt shelves plan for a huge new coal plant: Egypt’s Ministry of Electricity has decided to indefinitely postpone the 6600 MW Hamrawein coal plant near Hamrawein Port. The imported coal plant was proposed after legal restrictions blocking new coal power plants were overturned in 2015. In February 2018 the Egyptian Electricity Holding Company (EEHC), the government-owned utility, announced that a consortium of Shanghai Electric, Dong Fang and Hassan Allam Construction had won the tender for the project with a bid of US$4.4 billion which would deliver electricity at US$5.4 cents per kilowatt hour. The project has been shelved due to overcapacity and a preference for renewables. In late 2019 EEHC cancelled the agreement for the proposed 2640 MW Oyoun Mousa power station, preferring a 500 MW renewables project. (Daily News Egypt, Global Energy Monitor)
Polish utility’s annual report omits controversial mine and power plant plan: In its 2019 annual report the state-owned utility PGE omitted any mention of the proposed Gubin lignite coal mine and an associated 2700–3000 MW power plant. The proposed mine and power plant would have resulted in the displacement of an estimated 3000 people who live in 15 villages. While PGE indicated the end of the mine project in late 2019, it had not formally abandoned the power project. Civil society groups interpret the omission of the project from PGE’s financial report as tacit confirmation the project has now been abandoned. PGE reported that in 2019 its lignite and hard coal generation were down by 17 per cent and 11 per cent respectively. (Beyond Coal Europe, Global Energy Monitor)
Netherlands Cabinet agrees to negotiate coal cuts: The Netherlands Cabinet has agreed to either close or substantially reduce generation at three of the country’s remaining coal plants in order to comply with the Supreme Court ruling that greenhouse gas emissions must be reduced by 25 per cent compared to 1990 levels. While coronavirus restrictions have resulted in reduced coal generation, the Cabinet has agreed to negotiate with Riverstone Holdings and RWE over their Eemshaven and Maasvlakte plants. An opinion poll of 2342 people conducted by I&O Research found 77 per cent of respondents were concerned about climate change, up from 65 per cent in February. (NLTimes.nl)
Chilean coal mine closes after court win: The Mina Invierno coal mine on Riesco Island in southern Chile has closed after a court ruling cancelled the mine operator’s blasting permit. Subsequently the appeal court cancelled the company’s environmental permit. The mine, which was first approved in 2011, was a joint venture between Copec, a subsidiary of the Angelini Group, and a subsidiary of Von Appen. On a recent analysts conference call Copec announced that the company had recorded an impairment of US$122 million on the closure of the mine, its half-share of the loss. While mining has ceased, the companies are aiming to overturn the court decision on appeal. (La Tacera [Spanish], Empresas Copec, Global Energy Monitor)
Study finds air pollution exposure link to coronavirus cases: A study by researchers at the Harvard TH Chan School of Public Health has found that an increase of just one microgram per cubic metre of PM2.5 fine particle air pollution in the US is associated with a 15 per cent increase in the death rate of those infected with coronavirus. The study examined coronavirus deaths up to April 4 in 3000 counties across the US which account for 98 per cent of the population. The study took account of smoking, obesity, poverty and other factors. While the link between long-term air pollution exposure and higher death rates has been well documented, the new study estimates that this increase is 20 times higher for COVID-19 deaths. The study authors argue the results indicate the need for additional precautions for people living in areas of high pollution and the enforcement of air pollution standards. (Guardian, Harvard University)
European coal emissions decline as steel sector pollution become more visible: Preliminary European Commission data indicates that greenhouse gas emissions from coal power in European Union (EU) countries fell by 7.8 per cent in 2019. Since 2013 greenhouse gas emissions from coal generation have fallen by 43 per cent. While coal power generation accounts for 30 per cent of the total EU emissions, the energy policy think tank Ember notes that the role of the steel sector is now coming into sharper focus. It reports that while steel plants account for eight per cent of all EU emissions, they are now largest greenhouse gas emitters in the Netherlands, Spain, UK, France, Austria, Finland and Slovakia. (Ember)
Australian coal analysis scandal referred to police: The global testing company, ALS, has referred allegations that coal samples were falsified to the New South Wales Police after an investigation by audit company McGrathNicol found the practice had been widespread. ALS announced that the McGrathNicol report estimated that ALS’s Australian Coal Superintending and Certification Unit had “manually amended without justification” about 45–50 per cent of the certificates of analysis from the company’s laboratories in Newcastle, Mackay, Gladstone and Emerald since 2007. ALS said that four staff who had previously been suspended had been terminated. ALS stated there was “no evidence” of bribery. (Australian Financial Review [paywall], ALS)
Australia: NSW Environment Protection Authority has fined Yancoal subsidiary Warkworth Mining Ltd A$15,000 (US$9250) for causing a large dust plume following a major blast.
Australia: Data reveals pollution from Vales Point power station increased by 3000 per cent since 2013 while power generated increased by only 68 per cent.
Australia: A legal case has been filed against Whitehaven Coal alleging it failed to secure 5532 hectares of biodiversity offsets required when the Maules Creek mine was approved.
Bosnia and Herzegovina: Residents protest [Italian] against the construction of a coal ash disposal site for the Tuzla power plant.
Brazil: Usiminas closes a blast furnace at its Ipatinga plant due to a demand slump caused by coronavirus restrictions.
Colombia: Eleven killed and four injured in explosion at the Veracruz underground mine.
Denmark: Copenhagen utility HOFOR closes the last coal unit at the Amager power station making Copenhagen a coal-free city.
India: Singareni Collieries is aiming to commission two solar projects with a combined capacity of 15 MW at a mine site in Telangana state.
Mongolia: South Gobi Resources suspends [Pdf] mining at its Ovoot Tolgoi mine and plans to operate from stockpiles until there is more clarity over the lifting of the coronavirus restrictions at the Chinese border.
South Africa: Wind industry ponders legal action over Eskom’s curtailment of 2000 MW of existing wind capacity.
US: Judge clears way for defamation action by ex-Massey Energy CEO, Don Blankenship, against 20 defendants including media companies and the National Republican Senatorial Committee.
US: Coal companies owned by Republican West Virginia Governor Jim Justice, have paid US$5 million to settle legal action over thousands of mine safety violations.
Coronavirus impacts on coal sector broaden: The Canadian metallurgical coal producer Teck Resources has flagged that it expects production to be down by 15–20 per cent during the initial two-week shutdown and has suspended its guidance to investors on likely 2020 production estimates. In Mozambique, the coal export industry has been granted an interim exemption from a 30-day shutdown. Jindal Africa is continuing with its coal export operations. Vale, which employs 13,000 people in Mozambique, has repatriated some Brazilian workers and instituted home working for some administrative staff. In Poland, the metallurgical coal producer JSW has reported a 40 per cent production decline as coronavirus measures are adopted. (Teck Resources, Argus Media, Economic Times)
Coronavirus could lead to surplus in the seaborne market: An analyst with Noble Resources estimates that the downturn in demand due to coronavirus impacts could result in an oversupply of about 30 million tonnes in the global seaborne thermal coal market. Indonesian exports, which have been hit by India’s 21-day shutdown and slowing Chinese demand, could decline by about 15 million tonnes. Bayan Resources has suspended coal production from its two subsidiaries until April 30 and will supply orders from stockpiles. Chinese state-owned utility Guodian has reportedly cancelled 3 million tonnes of shipments ordered for the April–June period. Chinese coal production in the first two months of 2020 declined by 6.3 per cent with stockpiles at power plants sufficient for 27 days. Platts Analytics argues that while Chinese generation at coastal plants is slowly increasing, utilities will initially use stockpiles and defer new cargoes of imported coal until May or June. (Argus Media, Xinhua, Platts Analytics)
Pakistan looks to reduce pressure on power prices from fossil fuel projects: Pakistan’s Cabinet Committee on Energy (CCOE) has proposed extending the goods and service tax to power prices to offset the financial losses caused by 30 per cent depreciation over the last two years of the rupee against the US dollar. The costs of imported fossil fuels are denominated in US dollars. The committee is also seeking to offset the increased costs of capacity payments and to have coal import prices regulated by the Oil and Gas Regulatory Authority. At present the National Electric Power Regulatory Authority sets power tariffs for imported coal power projects based on invoices for coal. The CCOE’s deliberations come as the Power Division has proposed a six month freeze on power prices as part of a response to the impact of the coronavirus lockdown. (Dawn, Express Tribune)
Chinese province pursues hydrogen projects including in the steel sector: Hebei Development and Reform Commission, the planning agency for the province that is home to one-quarter of China’s steel capacity, has approved 43 new hydrogen projects worth US$1.23 billion. Hebei, which sees building hydrogen capacity as an emerging industrial opportunity, has also flagged its willingness to support hydrogen projects at steel plants in the cities of Tangshan and Handan districts. Late last year HBIS Group, the country’s second largest steel maker, entered into an agreement with the Tenova Group to build a 1.2 million tonne steel plant fuelled by hydrogen. (Nasdaq)
Japanese bank under pressure from investors: The major Japanese bank, Mizuho Financial Group, has flagged that it is “considering ways to strengthen our environmental and climate change efforts … including but not limited to coal-fired power.” In March the Kiko Network submitted a shareholder resolution requesting the company to set targets and a plan to align its business practices with the goals of the 2015 Paris Agreement. A coalition of investors, including KLP, Norway’s largest pension fund, Storebrand and Denmark’s MP Pension are supporting the resolution. The resolution, the first to be submitted to a publicly listed Japanese company, will be put to the company’s annual general meeting in June. (Reuters, Kiko Network)
Stockpiles grow as Coal India boosts production while demand slows: Indian power demand over the first 11 months of the 2019–20 financial year has grown by just 1.5 per cent, according to an analyst’s report. The 21-day shutdown ordered by the Indian Government to curb the spread of coronavirus has resulted in coal generation declining by 40 per cent over the last week compared to the same period in 2019. The decline in demand growth comes as Coal India has increased production but now has large stockpiles at pitheads and power plants. Captive power plant generators, such as cement and steel companies, have also requested a halt to deliveries due to the shutdown. Coal India has previously warned of the risk of spontaneous combustion at large coal stockpiles. Reduced demand and increased stockpiles is likely to result in a short-term reduction in imports. (Business Today, Platts, Economic Times)
Glencore settles benchmark contract negotiations with Japanese utility: The Japanese power utility Tohoku and Glencore, the world’s largest seaborne thermal coal exporter, have reportedly agreed on a benchmark contract price of US$68.75 a tonne for the year to March 2021 for Newcastle 6,322 kilocalories per kilogram coal. Last year Glencore’s April 2019 annual benchmark price was US$94.75 per tonne. The contract price between the two companies is viewed as a benchmark price for other Japanese utilities buying Australian thermal coal. It is estimated that Japanese utilities will import about 128 million tonnes of thermal coal in 2020. (S & P Global)
US coal production forecast to fall by almost a quarter in 2020: The Energy Information Administration (EIA) estimates that US coal production will decline by 22 per cent to 537 million tons (487 million tonnes) in 2020 compared to 2019 levels. The EIA estimates coal demand by the US power sector could fall by about 19 per cent. They also estimate that US exports of metallurgical coal could drop by 35 per cent to 35.8 million tons (32.5 million tonnes) and thermal coal by 29 per cent to 26.8 million tons (23.2 million tonnes). The EIA attributes the decline of coal to the increase in renewable capacity, reduced demand, the idling of some coal mines due to coronavirus restrictions and reduced European demand. (S & P Global, US Energy Information Administration)
The COVID-19 Crisis and Climate Lobbying, InfluenceMap, April 2020. (Pdf but registration required)
This 5-page briefing provides an overview of the emerging lobbying of governments by the fossil fuel industry groups in the US, Canada and Australia.
“The Carbon Brief Profile: South Korea”, Carbon Brief, April 2020.
This backgrounder provides a detailed overview of South Korea’s climate and energy policies, which will be issues in the country’s April 15 general election.
“If We Don’t Mine Coal, Someone Else Will”: Debunking the “Market Substitution Assumption” in Queensland Climate Change, Environmental and Planning and Law Journal, Volume 37, Part 2, April 3, 2020. (The link is to the abstract; the full journal article is behind a paywall.)
This paper critiques the Australian coal industry’s legal defence that the rejection of a coal mine in one location would only lead to burning of coal from another mine. The paper reviews court finding in Australia and internationally and argues that the “market substitution assumption” is legally wrong, uncertain, and morally and ethically unsound.