The case studies in the new report by PPCA cover policy, social, technical, and financial solutions implemented in various parts of the world to ensure a fair and just phase-out from coal towards cleaner alternatives
A new report shared case studies that demonstrated how systemic challenges that can arise when countries accelerate coal phase-out can be tackled, making way for a just transition. The report by Powering Past Coal Alliance (PPCA) illustrated the practical choices, pathways, and strategies pursued by PPCA members to end emissions from coal power spanning policy, social, technical, and financial solutions. The report was released on November 15, which was Energy Day at the UN climate summit COP27 in Egypt.
The report also found that three-quarters of coal-fired electricity generation capacity in the Organisation for Economic Co-operation and Development (OECD) and European Union (EU) is now on track to close by 2030. The scale of proposed new coal power plants has collapsed globally by the same amount since 2015. To continue such acceleration of the global transition, the report shared examples of successful solutions to move swiftly towards cleaner energy.
Government leadership and policy solutions in Chile and Canada
To eliminate coal from the energy matrix, it is crucial to collectively identify the key issues to be considered for a just, responsible and planned transition. Therefore, the report said, in 2018, Chile’s energy ministry assembled stakeholders and set up a roundtable, which included trade unions, non-governmental organisations (NGOs), and public and private entities, to find the balance between people and industry to accelerate coal exit.
A decade ago, Canadian leadership was the first in the world to introduce regulations requiring coal-fired power plants to meet stringent performance standards after it recognised that no fossil fuel produces more emissions than coal in generating electricity. A Just Transition Task Force was launched in 2018 to determine how best to support workers and communities impacted by the phase-out of coal power, added the report. Today, Canada’s accelerated coal phase-out supports its latest 2030 Emissions Reduction Plan to achieve a net-zero electricity grid by 2035.
Stakeholder engagements as social solutions in Poland and Germany
With coal mining at the heart of Wielkopolska province’s identity in Poland, a shift in the society’s collective mindset was required to create an entirely new, coal-free identity that remained authentic to its residents. Polish policy makers sought the involvement of different stakeholders and welcomed grassroot leadership as they created a new, shared identity for the region. Prioritising public dialogue and involving individuals from different backgrounds made it possible to understand distinct points of view, noted the report.
Walking on similar footsteps, Germany set up a Coal Commission in 2018 and tasked it to develop a plan for a coal phase-out. The report mentioned that key stakeholders from industry, trade unions, coal regions, environmental NGOs, research institutes, and communities came together and developed an action plan for a just transition.
Finance and investment solutions in the US and France
There are tools and approaches to direct the massive shift in capital and investment needed to meet climate goals. For instance, the state of New Mexico, US, is demonstrating new business models to accelerate coal power retirement. The use of low-cost financing in the form of securitisation in the state has enabled the early retirement of coal plants with a boost for renewables and support for communities, found the report.
While in France, new legislation and interventions by the government have led French financial institutions to adopt ambitious climate commitments and prompted the development of sectoral guidance on how to achieve them. Regulatory supervisors have published annual assessments around the time of Climate Finance Day each year along with updated guidance. To date, the report said, they have made nearly 30 recommendations to guide financial institutions toward defining their commitments and reporting on implementation more effectively.
Transitioning through technical solutions in Denmark
Talking about corporate and operational changes that made a difference, the report mentioned Ørsted, a domestic Danish energy firm. The company had a strategic goal of flipping the ratio of power and heat production from fossil fuel to renewable sources so that by 2040, 85% would be green and only 15% would be from fossil fuels. To make this happen, the company closed its coal-fired heat and power plants, or converted them to sustainable biomass, increased investment in offshore wind, and diversified further into onshore wind, solar, green hydrogen and energy storage. In 2019, Ørsted met its goal of green transformation a full 21 years ahead of schedule, having achieved a 90% share of its generation from renewable sources, the report found.
The report also mentioned Germany investing heavily in interconnections, demand-side measures and storage to maintain grid reliability to accelerate coal retirements.
Need to strengthen the enablers
Graham Stuart, UK minister of state for climate change and PPCA co-chair, said, “We have seen remarkable progress on coal phase-out since the world came together at COP26 and that progress must continue at COP27”.
The report concluded that a future without emissions from coal power—the single most important first step the world must take to meet Paris Agreement climate goals—is not just achievable, but will be cheaper, more secure, and help ensure a cleaner future for workers and communities. To reach this objective, it is crucial that:
- Public and private investment from coal is realigned to clean energy, which should be backed by robust financial policies and transparent reporting on progress and climate risks
- Legislation, policies and regulations are informed by social dialogue and stakeholder engagement
- A just transition is planned in a way that sustains livelihoods and the social fabric of communities
- Holistic support for developing countries is provided through coal transition mechanisms to accelerate coal asset retirement, more clean energy is deployed, and countries are positioned to capitalise on new market opportunities in clean technology.