July 28, 2016
Issue 144  |  View Past Issues
CoalWire

Editor's Note

With the prospects of a safe climate largely hanging on new power supply decisions in Asia, there are some encouraging trends. A protest and hunger strike against a proposed plant in South Korea has prodded the government to defer making a decision. In the Philippines, the newly-elected government has confirmed new coal plants will be required to gain approval from the Climate Change Commission.

But there are some holdouts too. The Australian Government continues to back coal while large parts of the Great Barrier Reef wither due to warming waters. Meanwhile, Poland is hoping an expensive PR campaign in Europe may help it stave off a switch to renewables for a little longer.

Bob Burton

Features

Opportunity for Philippines in Paris Agreement and shift from coal

Implementing the Paris Agreement provides the Philippines with the opportunity to both industrialise and improve health if the country is willing to be “candid about the terrible burdens that coal imposes on our environment and the health of our people”, writes Heherson T. Alavarez, former Vice-Chairman of the Philippines Government’s Climate Change Commission.

The truth about Australia’s coal industry and climate policy

The Australian Government’s climate policy is based on turning a blind eye to the emissions created by the burning of coal it exports. Once used, the coal exported daily generates about as much carbon pollution as a 500-megawatt coal-fired power station in a year, writes Guy Pearse in The Saturday Paper.

World Heritage Committee urged to tackle fossil fuels

With governments failing to protect World Heritage Sites such as Australia’s Great Barrier Reef and Bangladesh’s Sundarbans, the World Heritage Committee must play a greater role in helping bring an end to the relentless exploitation of fossil fuels, write Martin Wagner and Noni Austin from Earthjustice in Project Syndicate.

Campaigns

Hunger strike pushes South Korea to defer coal plant plan

A protest and one-week hunger strike in front of the Ministry of Energy building in Seoul has prompted the South Korean Government to postpone consideration of the 1160 megawatt (MW) ‘Dangjin Eco Power’ plant. The participation of the Mayor of Dangjin in the hunger strike was a critical factor in the decision to defer a decision on the SK Group’s proposed plant. (CoalSwarm, Flickr)

Top News

Philippines requires new permits for coal plants: The Philippines Government has tightened the permit process for new coal plants by requiring proponents to obtain additional clearances from the Climate Change Commission (CCC), a government climate policy agency, and the office of Senator Loren Legarda, who chairs the Senate Committee on Climate Change. The CCC is reviewing current energy policy plans with a view to substituting renewables for coal plants. “Adding that to the equation will make it more difficult,” complained an executive with GN Power, which is proposing a 1200 megawatt (MW) coal plant expansion in Marivales. (The Philippine Star)

Reports BHP Billiton set to dump NSW thermal coal project: The New South Wales Government has declined to comment on whether it has offered BHP Billiton over US$75 million to surrender its exploration licence for the 10 million tonnes a-year Caroona Coal Project. BHP Billiton paid US$75 million in 2006 for the exploration licence for the thermal coal project, which is on the rich agricultural lands of the Liverpool Plains and has been strongly resisted by the farming community. (Northern Daily Leader)

Serbia snubbed Romania over new plant: Serbia has failed to consult with Romania on the environmental impact of the proposed new coal unit at the Kostolac power station, despite a UN Economic Commission urging its near neighbour be involved in deliberations on the project. In late June the Serbian Administrative Court ruled the Ministry of Agriculture and Environmental Protection approval of the environmental impact statement was illegal. Serbia might also face a challenge over whether financial guarantees given to the China Export-Import Bank breach restrictions on subsidies. (CINS)

Poland sets up coal PR fund: The Polish Government has established the Polish National Foundation with an annual budget of US$25 million to defend the Polish coal industry against European Union plans to cut greenhouse gas emissions. The foundation will be funded by state-owned companies with a leader of the governing Law and Justice Party calling for the recruitment of “very serious” international firms to run the campaign. (Reuters)

Chinese coal downturn permanent, says Stern: In a paper published in Nature Geoscience journal Lord Nicholas Stern and colleagues at Tsinghua University in Beijing argue Chinese coal consumption peaked in 2014 and the country has entered “the era of post-coal growth.” They argue the decline of domestic coal consumption is a permanent rather than a temporary feature of China’s development and may be an important “turning point in international efforts to mitigate the emissions of climate-altering greenhouse gases.” (Guardian, Nature Geoscience)

“If we take the 2C target seriously, coal really has to disappear … I think coal will have to be phased out completely in all countries of the world by about 2035,”

said Professor John Schellnhuber from the Potsdam Institute for Climate Impact Research.

“If we take the 2C target seriously, coal really has to disappear” by 2035 Prof John Schellnhuber https://www.theguardian.com/environment/2016/jul/25/china-coal-peak-hailed-turning-point-climate-change-battle #climate

News

Australia: Toxic coal ash from two Queensland power stations illegally stored in industrial sheds.

India: Rathi Steel & Power and three directors sentenced to three years goal
for criminal conspiracy over coal allocation.

Myanmar: Coal projects in Shan state frozen while cost-benefit studies are undertaken.

Pakistan: Power board fails to get private power developers to switch from imported to local coal.

South Africa: Government throws a five-year lifeline to the controversial Makhado mine project.

Companies + Markets

Further cuts to Indian imports likely: Minister for Power and Coal, Piyush Goyal, told Parliament that in the year to the end of March 2016 India imported 199.9 million tonnes of coal – a decline of eight per cent on the previous year. Coal India is aiming to increase domestic production by 11.1 per cent to over 598 million tonnes this year, further undermining imports. Adding to this, 47 million tonnes of coal remain stockpiled at Coal India mines and a further 31.39 million tonnes at power stations. (Platts, WebIndia)

BHP Billiton’s thermal coal cools: BHP Billiton has reported its thermal coal production fell by 16 per cent to 34.25 million tonnes and projects a further fall to 32 million tonnes in the current year. The company stated bad weather affected NSW coal production while production from the Cerrejon mine in Colombia in which it has a one-third stake fell by 11 per cent to 10.1 million tonnes due in part to a nine-month-long drought. BHP Billiton’s metallurgical coal production was marginally higher than the 40 million tonnes forecast. (Platts, BHP Billiton)

Purchase of Vattenfall’s German lignite plants a ‘subsidy play’: The Swedish company Vattenfall has reported heavy losses in the first half of the year on its lignite mines and plants in Germany with the company’s chief financial officer saying this was “the rationale for us divesting it.” The sale to a Czech consortium has been described by IEEFA analyst Gerard Wynn as “a subsidy play” for “regulated fossil-fuel assets supported by guaranteed payments.” (Institute for Energy Economics & Financial Analysis)

Shenhua merger with nuclear giant signals Chinese coal shift: Chinese government officials are considering a proposal by Shenhua, the country’s largest and best financially performing coal producer, to merge with China General Nuclear Power. The company’s proposed merger is viewed by analysts as a bid to reduce exposure to government moves to reduce the role of high-carbon fuels in power generation and cut coal industry capacity. (Bloomberg, Bloomberg)

Major Chinese coal port operator incurs big losses:  Qinhuangdao Port, which operates the world’s largest coal port by the same name, handled 75.1 million tonnes of coal in the first six months of 2016, a fall of 34.7 per cent. The Hong Kong-registered company has warned that as a result of a fall in coal volumes the company’s profits will fall by 80 to 90 per cent. (Seatrade Maritime News)

China pursues coal restructuring: The Chinese Government has established a coal asset management company, with Shenhua and China National Coal Group as two of the four joint-venture partners – to help restructure the government-owned coal sector and cut over-capacity. Separately, the National Development and Reform Commission (NDRC) warned against further coal price rises as they would undermine moves to cut over-capacity. “Coal prices shouldn’t rise too much or too fast,” said the NDRC’s vice chairman. Higher domestic prices have also spurred increased imports. (Reuters, Bloomberg)

Resources

Fuelling the Fire: the chequered history of Underground Coal Gasification and Coal Chemicals around the world, Friends of the Earth International, July 2016. (Pdf)

The 67-page report provides a global overview of the development and problems with underground coal gasification and coal-to-chemicals plants. The report includes case studies from Australia, China, South Africa, the UK and the US.