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German coal phase-out schedule in question as court rules against newest plant

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A German court has ruled that permission to build the country’s newest coal plant, Datteln IV, was granted illegally.

The ruling comes as a result of a case brought by local residents, supported by environmental law charity ClientEarth, and another by the North Rhine Westphalia arm of Friends of the Earth (BUND NRW).

The ruling removes one of two legal grounds the hard coal plant needs in order to keep running. The residents already have a second case against the operating permit – the second legal ground – in the pipeline. If Datteln loses both legal bases to operate, its activities must cease.

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As one of the last plants scheduled to close in Germany’s contested coal phase-out pathway, an earlier shutdown than 2038 would change the structure of Germany’s prescribed coal exit.

ClientEarth lawyer Francesca Mascha Klein said: “This ruling is yet another message for any political leader or company still backing coal.

“This plant has always been a disaster – based near a children’s hospital, and on the doorstep of hundreds of homes, its toxic emissions and climate burden should have prevented it ever being approved. Finland’s environment minister even expressed public regret that a Finnish company was powering ahead with a new coal plant.

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“As the elections loom, and concrete climate impacts hit home in Germany, this is a timely and unmissable message to candidates like Armin Laschet, who are, incredibly, still promoting a ‘softly softly’ approach to moving away from fossil fuels.

“Germany could and should be a leader in pioneering a clean energy transition – instead, citizens are having to force government and companies’ hands in the courts.”

When the plant was first planned, residents and Bund NRW took legal action to fight it – and won, over ten years ago. But the authorities sidestepped the ruling to keep the project going.

In today’s ruling, the judge said “striking errors” had been made by the local authorities.

Klein said: “Amazingly, these cases only became necessary because of the elaborate steps authorities took to protect coal operators, at the expense of people’s health and the environment. This time, things will be different –  we will keep supporting the residents in their fight for a safe environment.”

Local resident Rainer Köster said: “We have been waiting for 11 years for this decision and we finally have exactly the news we wanted. I am overjoyed.”

Legal action

Environmental lawyers ClientEarth are supporting residents with the challenge won today, and the ongoing challenge to the operating permit. Today’s win means Friends of the Earth Germany – North Rhine-Westphalia e.V. (Bund NRW)’s parallel case was also successful.

The plant emits heavy metals and toxic substances including mercury, lead and arsenic, polluting the air and water and presenting health threats from cancer to neurological disorders. An additional threat to residents may be Legionnaire’s disease, as bacteria collects in airborne water droplets from cooling towers.

Already in 2005, plans to build the hard coal plant were being met with resistance. An initial challenge by residents saw the plans for the plant overturned. An injunction by BUND NRW in 2009 to stop construction, and the application to revoke the preliminary permit in 2012, were both successful in court. This removed the legal justification for the plant.

However, instead of stopping construction, the local authorities instead came up with a new set of plans and issued fresh approval on that basis.

The current challenges are against these new plans and approvals.

Local and regional resistance to coal in Germany is growing, with many either living next door to coal facilities or facing eviction to make way for them. ClientEarth is also supporting Menschenrecht vor Bergrecht, a group of villagers in North Rhine-Westphalia who are fighting in court to save their homes from mine expansion.

Corporate background

Finnish-owned Fortum has declared itself to be moving beyond coal, but acquired Uniper, Datteln IV’s operator, notwithstanding.

Investors have already expressed frank dissatisfaction over Datteln IV. A joint letter reads:

“We believe opening the plant is not compatible with an ambitious decarbonization trajectory and endangers the 2030 deadline for phasing out coal in the OECD – required to keep emissions within the critical 1.5°C carbon budget.”

Finland’s Environment Minister issued a public statement of displeasure over state-owned Fortum’s acquisition of the Datteln IV project. She tweeted (here in translation):

For the sake of the climate we have to get rid of coal plants, not open new ones. I encourage Fortum to actively seek a solution in order to ensure that its subsidiary Uniper withholds from opening the new Datteln coal plant. I have discussed the German coal phase-out plans with the German Greens. 3/3

Datteln IV sources its coal mainly from Russia but also from Colombia, raising serious human rights concerns.

About ClientEarth

ClientEarth is a non-profit organisation that uses the law to create systemic change that protects the Earth for – and with – its inhabitants. We are tackling climate change, protecting nature and stopping pollution, with partners and citizens around the globe. We hold industry and governments to account, and defend everyone’s right to a healthy world. From our offices in Europe, Asia and the USA we shape, implement and enforce the law, to build a future for our planet in which people and nature can thrive together.

Environment

European leaders appeal to G20 - ‘The world urgently needs leadership from the biggest countries – now’

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The prime ministers of Belgium, Denmark and Estonia (Alexander De Croo, Belgian Prime Minister; Mette Frederiksen, Danish Prime Minister; and Kaja Kallas, Estonian Prime Minister) used their doorstep for today’s European Council (21 October) to promote a letter they and other small states have sent to the G20.

The open letter sent ahead of the G20 Summit at the end of October and ahead of COP26 urges G20 countries to send a clear signal that they are fully aware of the responsibility they bear and the global leadership needed for a just transition. 

The letter states: “With 80% of global GDP, the G20 has a vital role to play in building a more resilient world. We encourage G20 members to scale up public financing for adaptation as also underlined by the UN Secretary-General, as we seek a balance between adaptation and mitigation support. We further call on the G20 to show solidarity with those most in need by delivering on the $100 billion pledge from developed countries. We must clearly signal to those on the frontline of the climate crisis that the world’s largest economies stand with them. The world urgently needs leadership from the biggest countries – now.”

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With 10 days to go until the world gathers in Glasgow for the UN Climate Conference, it seems that some of the most important leaders will be missing from the event: China’s Xi Jinping and Russia’s Vladimir Putin have confirmed that they won’t attend, India’s prime minister Narendra Modi hasn’t yet confirmed. 

This evening EU27 heads of government are discussing their approach to COP26, in his letter to leaders Charles Michel called for an ambitious approach. 

Today, the European Parliament 21 October, Parliament adopted its position for the upcoming UN Climate Change Conference in Glasgow. MEPs are concerned that the targets announced in Paris in 2015 would result in warming well above three degrees by 2100, compared to pre-industrial levels. They say that the EU must remain a world leader in the fight against climate change and that MEPs will work to ensure that the EU’s “Fit for 55 in 2030” climate package is fully in line with the Paris Agreement. They also call on all G20 countries to be climate neutral by 2050 and demand that at least $100bn in climate finance per year are made available for developing countries.

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Climate change

Murat Aliev’s Bonum Capital combats climate change with Russian forestry sector deal

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Russia is home to a fifth of the planet’s forests, more than any other country in the world by a comfortable margin. But the country’s share in the global forest products market is just 4%, according to the UN – writes Colin Stevens

International investment group Bonum Capital believes that this has the potential to change, and is brokering a deal worth over half a billion dollars, which will make it a large stakeholder in a land-rich publically traded Russian forestry company Segezha Group, founder and sole owner of Bonum Capital Murat Aliev accounced on October 11th.

“In line with global trends around sustainability and combating climate change, we are strong believers in the outlook for the global forestry sector and see enormous potential for investment in Russian forestry assets, where improvements to operational efficiency and sector consolidation are creating significant opportunities for higher returns and growth of shareholder value.” Murat Aliev, founder and owner of Bonum Capital, told EU Reporter.

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Bonum’s deal with Segezha will see the investment group sell Inter Forest Rus – a holding company comprised of high-quality assets and substantial forestry resources that was established to consolidate quality assets in the sector – to Segezha, expanding its existing resource base by half again. As a result of the deal, Segezha will own 16.1mn hectares of forest under long-term lease, five times more than any of its largest publicly traded peers.

The deal value is in the region of $515mn. It is expected that this amount will be split in three parts: $238mn will be applied towards restructuring and consolidation costs in respect of the target assets; $205mn will be used to retire some of the target group’s debt; and Bonum Capital will take home approximately $82mn, $68mn of which is payable in instalments across a period of four years post-completion subject to the satisfaction of certain payment conditions.

Bonum also will invest $150mn in additional shares in Segezha, bought from Sistema – Segezha’s founder and majority shareholder.

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“In the current context of global trends around sustainability and combating climate change, we are strong believers in the outlook for the global forestry sector and see huge potential for investment in Russian forest assets, where improvements to operating efficiency and sectoral consolidation are creating huge opportunities for higher returns and growth of shareholder value.” said Aliev.

Separately, Bonum Capital has entered into a sale and purchase agreement to acquire a stake in Segezha Group from PJSFC Sistema, a publicly traded Russian investment company and the majority shareholder in Segezha Group, for the ruble equivalent of $150 million. As a result, Bonum Capital will increase its shareholding and become Segezha Group’s second largest shareholder with a stake of approximately 13%. The transaction is also expected to close in 1Q 2022 and will be funded with the proceeds from the Inter Forest sale and bank financing.

Bonum has been making considerable inroads into the forestry sector over the past year. It participated in Segezha’s IPO in April 2021, and also consolidated Inter Forest Rus, the holding company, which they are selling to Segezha. 

Bonum Capital is an investment group founded in 2013 in Moscow. The company’s founder and sole owner is Murat Aliev.

It invests in various assets including international public markets, private equity, venture capital and real estate in Russia. The company’s primary business is proprietary investing on public markets with focus on long-term concentrated positions.

Bonum Capital has been involved in all major recent CIS IPOs, including OZON, Kaspi.kz, Segezha Group, Fix Price and United Medical Group (EMC). Bonum Capital has expertise in purchasing and developing distressed assets with high potential for value growth, including through synergies with other assets of industry players.

Inter Forest Rus comprises 24 companies from different segments of the timber industry, and includes a vast swathe of forested land in Siberia as well as 5,000 employees, new mills and a fleet of boats for transporting resources by river.

Inter Forest Rus was created as a holding company to consolidate quality assets in the forest industry. Inter Forest Rus currently comprises the core assets of LDK Igirma, Trans-Sibirskaya Lesnaya Kompaniya and Priangarsky LPK, as well as over 20 companies in segments including forest ownership, logistics and operations.

It has one of the largest annual allowable cuts in Russia (88% softwood) at approximately 10.9 million cubic meters on a consolidated basis. Its production capacity is 1.5 million cubic meters of sawn timber at four sawmills, 35,000 cubic meters of plywood and 170,000 tons of pellets.

 Its main markets include China, Japan, the EU and Egypt, as well as Russia and other CIS countries. The company employs about 5,000 people. OIBDA for 2021 is expected to be approximately RUB 11 billion.

Bonum also acquired the rights for a number of companies in the forestry sector from Trust Bank in 2020 at auction. The deal therefore marks a considerable consolidation in the Russian forestry market, with Segezha now boasting one of the largest allowable cuts of any publicly listed forestry company in the world, at 23.6mn cubic metres.

“Our long-term interests in the sector are now focused on Segezha, which with its outstanding management team and a proven and profitable business model is well positioned to take Russia’s forestry industry to a new global level. As a result of this transaction, we will significantly increase our stake in Segezha Group and become its second-largest shareholder. We believe that Segezha has the potential to become one of the biggest success stories in Russia’s capital markets.” said Aliev.

Bonum Capital invests in several asset classes including international public markets, private equity, venture capital and Russian real estate. The company’s core business is investing on public markets.

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Asbestos

Asbestos protections could save 90,000 lives a year

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Responding to the result of the vote in the European Parliament on the Villumsen report on protecting workers from asbestos, ETUC Deputy General Secretary Claes-Mikael Ståhl said: “Nobody should die because of their job. Yet more than 100,000 people still lose their lives every year in Europe from work-related cancer and asbestos is responsible for more than half of those deaths.

“Construction workers, miners, firefighters and waste disposal workers have been among those most likely to develop lung cancer because of contact with asbestos, but the widespread use of the material in buildings means many teachers and office workers have also died.

“This silent killer has been tolerated for too long so trade unions are relieved the European Parliament has supported protections which could save up to 90,000 lives a year following a campaign led by the EFBWW and we call on the Commission and Council to put them into action as soon as possible. The Commission removed the asbestos from its own offices in the mid-1990s so it’s not right the problem should still be tolerated at other people’s workplaces.

“This is a vital first step towards ending the scandal of work-related cancer. But there are still no workplace exposure limits for 23 high-risk cancer-causing substances, while limits for another 27 carcinogens are often still far too high to protect workers from cancers which can be fatal or cause reproductive problems. It’s time for the Commission to match its rhetoric on combating cancer with action.”


Letter sent by European trade unions to MEPs

ETUC position on the EU strategic framework on health and safety at work 2021-2027

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