Pvt. players welcome ‘unrestricted commercial extraction’
India’s private sector has welcomed the government’s decision to end Coal India Limited (CIL)’s monopoly on coal extraction, saying that allowing up to 100% FDI and unrestricted commercial extraction by private firms will drive “efficiency of extraction” – which could allow private players to theoretically undercut CIL’s per ton cost of coal extraction and sell it at higher profit margins.
CIL’s workers and national trade unions have opposed the move, fearing that the move may jeopardize CIL’s future in the face of competition, and that private players’ unethical mining practices and insufficient compliance with environmental norms for extraction may drive down wages for contract labourers.
CIL has however sought to reassure unions that it was going to benefit from the deregulation – perhaps on the back of its advanced expertise in coal mining, which most private players lack. Also the govt. is already looking to establish a regulatory body to oversee all mining technologies and practices for commercial coal mining.
China beats own target on coal capacity phase out
Despite posting a 0.4% increase in coal consumption for the first time in three years (for 2017, over 2016) – which was driven by an unusually severe winter – China managed to suspend operations from 65GW of coal-fired power plants in 2017. This was 15GW in excess of its State Council’s target of 50GW, and as a result China’s share of coal in its energy mix dropped by 1.6% to 60.4% for 2017.
The country is aiming to get coal-fired power to below 58% of its energy mix by 2020, and the target seems all the more plausible on the back of its phenomenal 54% increase in installed solar capacity for 2017 (53GW, as compared to 34.5GW for 2016). It will also slash steel and coal output in 2018 (30 million and 150 million tons resp.) in an aggressive bid to “defend its blue skies”.
Meanwhile, India’s NTPC has indicated it will reduce its dependence on coal from 85% at present to 65% by 2032 by primarily focusing on hydro power.
Generali joins coal disinvestment bandwagon
Joining industry partners AXA and Allianz, Italy’s Assicurazioni Generali has announced it will be divesting its roughly €2 billion worth of coal related holdings as part of its new strategy of minimizing insurance exposure.
It will instead invest about €3.5 billion in green projects by 2020, which mirrors the trend by the world’s largest insurers to divest away from fossil fuels. The move was largely prompted by the Bank of England’s dire warning in 2015 of catastrophic losses for fossil fuel firms, if they were forced to curtail production in light of strategies to avoid breaching the 2°C global warming limit.
About The Author
You may also like
Shell wins appeal against historic climate ruling
Human-caused air pollution led to 1.6 million deaths in 2021 in India: Lancet report
Current policies to lead to a “catastrophic temperature rise” of up to 3.1°C: Emissions Gap Report
Fossil fuel extraction in UNESCO sites to rise nearly 50% in coming decades: Report
India clears 1 million sq km cleared for oil exploration in ‘no-go’ area
