08 October 2021 at 12:22 pm
The 2021 Global Coal Exit List (GCEL) shows that 49% of the world’s coal industry is still on an expansion course. Even amongst the less than 5% of companies that have announced coal exit dates, many are selling on coal assets without retiring them, or ensuring that just transition strategies are in place.
Three weeks before the start of the UN Climate Summit in Glasgow, non-profit environmental and human rights organisation Urgewald, along with 40 partner NGOs including Life After Coal Campaign coalition partners Earthlife Africa Johannesburg, groundWork, and the Centre for Environmental Rights, have released the 2021 update of the “Global Coal Exit List” (GCEL).
The GCEL provides detailed data on 1,030 companies, making it the world’s most comprehensive public database on the coal industry.
1,000 Companies Driving the World Towards Climate Chaos.
The 2021 GCEL paints a bleak picture of the global phase-out of coal.
The list found that, while many new coal projects were scrapped in 2021, up to 480 GW of new coal-fired power capacity and 1,800 million tons per annum of new thermal coal mining capacity are still in the pipeline. If built, these projects would increase the world’s coal power capacity by 23% and thermal coal production by 27%.
Out of the 1,030 companies listed on the 2021 GCEL, 503 companies are still planning to develop new coal power plants, new coal mines or new coal transport infrastructure.
In addition, despite the fact that the 2018 IPCC report warned that 78% of the world’s use of coal for power and heat needs to be phased out by 2030 in order to avoid overshooting the 1.5°C limit set out in the Paris Climate Agreement, only 49 of the 1,030 companies on the GCEL have announced a coal exit date. And in one third of these cases, the coal exit dates are far too late.
No just transition in place
According to the 2021 GCEL, even when a company announces its exit from coal, it often means that its coal assets will be sold on to a new owner, rather than retired.
A prime example (although not the first) is the multinational miner Anglo American, which has been mining coal in South Africa since 1945. Instead of retiring its coal mines by rehabilitating environmental damage caused and addressing the ongoing pollution and health problems caused for local communities, Anglo American exited coal by transferring its polluting coal assets in June 2021 into a new company: Thungela Resources.
According to a report by Boatman Capital Research, the clean-up costs for Anglo American’s former mines will likely be three times higher than estimated, and will exceed the value of the new company.
“This type of deal is a lose-lose for everyone except Anglo: for our climate, because the mines will keep on operating; for the environment; and for affected communities as they will be left with the problems when Thungela Resources is unable to shoulder the clean-up costs. A broad and inclusive just transition requires a responsible closure of coal assets and rehabilitation of land and water, and retraining and job creation programs for workers. All Anglo American has done is kick the can down the road,” says Bobby Peek from the environmental justice NGO groundWork and Friends of the Earth South Africa.
“It is imperative for South Africa not to be left behind in the global transition away from coal. Demonstrating ambition to be a leader in the just transition away from coal is not only crucial to prepare South Africa for a zero carbon future, but also to increase our prospects of securing the finance needed to mitigate the social, economic and environmental consequences of climate change. While any finance requires transparency and scrutiny to ensure that it is the best deal for South Africa, being seen as a climate laggard compared to countries like Vietnam and Indonesia risks South Africa being at the back of the queue when it comes to securing this critical financing,” says Melissa Fourie, Executive Director of the Centre for Environmental Rights.
A precarious turn from coal towards gas
Another worrying trend noted by the 2021 GECL is the rapid increase of new fossil gas-fired power capacity to replace coal.
The report found that even in countries where coal plants are being retired or new coal power projects are dropped, a significant portion of these plants are being replaced not by cheaper, cleaner renewables, but by new gas-fired power capacity.
This is extremely worrying as gas is mostly composed of methane, which has 86 times the warming power of CO2 over the first 20 years after it is released. Methane is responsible for at least 25% of today’s warming and methane leaks go hand in hand with the process of extracting, storing and burning gas.
The GCEL was first launched in November 2017 and is updated each fall. It covers the largest coal plant operators (³ 5 GW installed capacity) and largest coal miners (³ 10 mtpa); companies that generate over 20% of their power generation or revenues from coal, and companies that are planning to expand coal mining, coal power or coal infrastructure. Investors representing over US$ 16 trillion in assets are currently using one or more of the GCEL’s 3 divestment criteria to exclude coal companies from their portfolios.
Most of the information in the GCEL is drawn from original company sources, such as annual reports, investor presentations and stock filings. Data on coal power expansion was mainly drawn from Global Energy Monitor’s Coal Plant Tracker. All in all, companies on the GCEL represent 90% of the world’s thermal coal production and the world’s coal-fired capacity.
The 2021 GCEL can be downloaded at www.coalexit.org
FOR MORE INFORMATION, OR TO ARRANGE AN INTERVIEW, PLEASE CONTACT:
Life After Coal Campaign: Alexis Scholtz-Wheeler, [email protected], +27 (0)827398687
Urgewald: Heffa Schuecking, Director, [email protected], +49-160-96761436