“We’re going down to zero.” 

That’s what Thomas Hörnfeldt, vice president of sustainable business at the Swedish-based steel-maker SSAB, told The Narwhal of his company’s carbon emissions. 

Hörnfeldt spoke to me on a video call from his office in Stockholm, a virtual backdrop of a picturesque Swedish canal flickering behind his office chair. He proudly displays a small piece of what he described as SSAB’s first fossil-fuel-free steel on his desk. 

The company made that sample, no coal needed, a year ago in the basement of a technical university in Stockholm. It’s an early step in SSAB’s commitment to completely eliminate carbon pollution from its steel manufacturing plants.

SSAB, which produces approximately 8.8 million tonnes of steel every year at its production plants in Sweden, Finland and the United States, has invested in technology that uses clean hydrogen in place of metallurgical coal.

Metallurgical coal has long been used to manufacture steel, one of the most ubiquitous materials on the planet. Coal is conventionally used for heating and in chemical reactions to create iron, the essential ingredient needed to make steel. But as the world grapples with the climate crisis, the steel industry’s centuries-old reliance on coal — and its enormous carbon footprint — is being called into question.

According to the World Steel Association, the industry is responsible for between seven and nine per cent of the global emissions created from the burning of fossil fuels. 

With the Paris Agreement setting out global goals to dramatically reduce carbon pollution and limit warming to less than two degrees by 2050, the steel sector is, for many, next up in the push to rethink age-old industries.

“It’s a 2,000-year-old technology that just keeps getting refined,” Chris Bataille, an adjunct professor in energy economics at Simon Fraser University, told The Narwhal. And, he said, the next shift for steel manufacturing may well be away from using coal.

That’s exactly what SSAB is doing. The company announced its plans in 2016, along with two partners. The resulting joint venture, Hybrit, also includes an iron ore supplier (LKAB) and an electricity supplier (Vattenfall) — bringing the major components of steel-making together under one umbrella to use hydrogen instead of coal. 

“This concept has been known in the past and it has been done on a small scale,” Hörnfeldt said. “Nobody has really done this in an industrial environment. And that is what we’re testing right now.”

The first pilot plant launched last summer. The company plans to start shutting down its coal-reliant furnaces in a matter of years.

The plans in Sweden are taking root just as the Alberta government faces widespread backlash for its push to open up the province’s iconic Rocky Mountains and eastern slopes to open-pit mining for steel-making coal.

In Sweden, steel-making giant SSAB has announced plans to eliminate its need for metallurgical coal in its plants by 2045. The company uses hydrogen — produced using clean-energy powered electrolysis — in place of coal, dramatically reducing carbon pollution. With the first fossil-fuel-free steel produced last year, the company now has its sights set on bringing it to market in 2026. Photo: SSAB

‘The world is looking for steel-making coal’: Alberta energy minister

The Alberta government began its fraught push for coal nearly a year ago, when the province’s United Conservative Party government announced it had done away with a 1976 policy that prevented open-pit coal mining in much of the Rocky Mountains. New mines in the region would produce metallurgical coal, used for steel-making. Backlash ensued.

But even as the government back-pedalled, it has maintained its commitment to the idea that there is a prosperous future in the metallurgical coal industry.

“There is a tremendous resource of metallurgical coal in Alberta and the world is looking for steel-making coal,” Energy Minister Sonya Savage said in a press conference in February as she defended her government’s push to expand mining opportunities.

Metallurgical coal mines, Savage added, “can help Alberta businesses meet increasing global demand for steel and provide good-paying jobs for hard-working Albertans.” 

Alberta Energy Minister Sonya Savage has defended her government’s attempt to open up the Rocky Mountain region to metallurgical coal mining, saying “ the world is looking for steel-making coal.” While global demand for steel is expected to increase in coming years, the industry is increasingly looking at ways to move away from coal in favour of technologies that produce far less carbon pollution. Photo: Government of Alberta / Flickr

The International Energy Agency has projected global demand for steel will increase by more than a third by 2050. Steel will, in part, help build new infrastructure such as wind turbines, electric vehicles and high-speed trains in the cleaner, greener global economy envisioned to facilitate the push to net-zero.

As the Energy Transition Hub, a German and Australian partnership, pointed out in a November 2019 report, “new metal [is] central to the zero-carbon transition. Renewable energy, and related technologies such as batteries, rely on steel … and a host of other metals.”

And while the Alberta government says this will mean a boom for the coal industry, not everyone agrees.

Blake Shaffer, assistant professor of economics at the University of Calgary, told The Narwhal  in February the expansion of metallurgical-coal mining in Alberta is an example of the province “chasing the next thing that’s going to die.”

“Rather than staking some economic bets on the growth of metallurgical coal … why don’t we become the leader in green steel-making?” he asked.

While Alberta may be slow to consider his pitch, other parts of the world are moving full-steam ahead.

Metallurgical coal mining, like at this Teck Resources-owned open-pit mine in B.C.’s Elk Valley, has flourished in B.C. and new mines are also currently being proposed in Alberta’s Rocky Mountains. If approved, the Grassy Mountain Mine — unaffected by the government’s “pause” on new projects in parts of the region — could produce as much as 4.5 million tonnes of processed coal per year for 25 years. Photo: Jayce Hawkins / The Narwhal

Coal is the main contributor to the carbon pollution produced with steel

The steel industry is the world’s largest industrial consumer of coal, according to the International Energy Agency.

Steel is an alloy —  a mixture of iron and other metals. Pure iron is hard to find naturally, and coal has long been essential in obtaining it.

The process is technical, but here’s the gist: essentially, coal is heated to super-high temperatures (more than 1,000 degrees celsius) to make a carbon-dense substance called coke. The coke is combined with iron ore — iron and oxygen — in what’s known as a blast furnace. 

Steel-making has conventionally relied on metallurgical coal, which is rich in carbon, in the production of pure iron, essential in steel. The coal is used for heating, but also for a chemical reaction in which a carbon-dense substance called coke, derived from coal, reacts with iron ore to leave pure iron. In the process, carbon combines with oxygen to produce carbon dioxide emissions. The resulting carbon pollution is greater than in any other heavy industry. Photo: Shutterstock

That first part is fairly simple: it’s basic heating. “The heating part is only 20 per cent,” Bataille explained. “It’s the chemical reaction of stripping the oxygen off the iron ore that’s 80 per cent of the work.”

And that’s the part you might need to reach back to high school chemistry class to understand.

In the blast furnace, the coke reacts with the oxygen and “strips it off” the iron ore, leaving melted pure iron, a main ingredient of steel, explained Bataille. It’s a simple chemical reaction that is essential to getting pure iron.

“Then we can combine it with nickel and zinc and chromium and what have you,” Bataille said. “And that’s steel.” That finished product remains one of the world’s most ubiquitous and important building materials, used in nearly every building, vehicle, machine, plane, ship, public transit system and bridge on the planet. 

The problem is this: according to the International Energy Agency, the steel and iron industry produces more carbon pollution than any other heavy industry. 

“If we’re going to actually hit somewhere between 1.5 and 2 degrees, blast furnaces have to be shut down,” Bataille said. 

And SSAB plans to do exactly that.

SSAB plans ‘fossil-free steel’

SSAB has said it aims to be the “first steel company in the world to bring fossil-free steel to the market” in 2026. 

The company added it will be “practically fossil free by 2045.”

“To be perfectly frank, we made this schedule a couple of years ago, and a lot of things have happened,” Hörnfeldt, the vice president of sustainable business, told The Narwhal. “Personally, I believe that this is going to happen much faster.”

“Within the foreseeable time frame, we are going to close down all our blast furnace operations.”

The plan is to use green hydrogen and clean electricity in place of coal in the manufacturing process (more on that later). 

The company has said its goal is to reduce Sweden’s carbon pollution by 10 per cent and Finland’s by seven per cent. 

Hörnfeldt said the first of the company’s four blast furnaces will be shuttered in four years at the latest.

Companies like SSAB have developed plans to eliminate coal from their steel plants. In place of coke, derived from coal, the company plans to use clean hydrogen. Like carbon, hydrogen can also strip oxygen from iron ore to make the pure iron needed in steel-making. But in this reaction, the resulting “emission” is H20. Photo: SSAB

Scrap metal, natural gas also options to reduce coal demand

SSAB and Hybrit are not the only ones looking at ways to decarbonize steel, and hydrogen is not the only proposed technology.

One possibility involves the increased use of recycled steel. According to the World Steel Association, an industry group, steel can be recycled indefinitely, without a reduction in quality.

Since so much of the demand for coal comes from making pure iron, using recycled steel can cut down on emissions. A technology called an electric blast furnace — powered by electricity — can transform scrap steel anew again. 

With clean electricity, the technology can dramatically reduce emissions. According to the World Steel Association, approximately 28 per cent of global steel is produced using electric arc furnaces, though not all of them would solely rely on scrap steel. 

Turning scrap metal into new steel in an electric arc furnace requires electricity, which represents a further opportunity to decarbonize.

SSAB’s steel production in the United States is scrap-based, Hörnfeldt noted, adding that the company plans to switch one of its two U.S. plants to clean electricity next year.

But not all demand for steel can be satisfied with scrap. According to the Energy Transition Hub, “recycled metal is likely to supply much less than half of global demand between now and 2050. … The remainder of metal demand will be met using virgin materials.”

Steel is a durable metal that can be recycled indefinitely, meaning many companies can reduce their carbon pollution by used scrap steel in place of virgin materials. Scrap steel, though helpful in reducing the carbon pollution of the industry, is not expected to be able to fulfill the entirety of the demand for steel in coming decades. Photo: Shutterstock

To decarbonize virgin steel manufacturing, some players in the industry have turned to another idea, involving replacing coal with natural gas.  

“There is a technology called Midrex,” Bataille explained. Back to high school chemistry again: instead of using coking coal, natural gas is used to “rip the oxygen off the iron ore, leaving elemental iron.” Then that iron, produced without coal, can be put into an electric arc furnace, powered by clean energy.

“This is an established technology,” he added. “And it’s much lower [in carbon emissions]. And there are these plants running all over the world.”

But the idea generating the most excitement — thought by advocates to be potentially among the greenest — involves using just hydrogen, like SSAB. Midrex boasts on its webpage that its plants are also poised to pivot to hydrogen.

In that process, hydrogen will strip away the oxygen from iron oxide. The byproducts? The pure iron needed for steel-making and good old H20.

“Consensus is growing that the best way to make steel without fossil fuels is with renewable hydrogen,” concluded the 2019 report from the Energy Transition Hub.

Emissions associated with hydrogen dependent on the way it’s produced

Hydrogen is already being used around the world, but current hydrogen production is geared more for other industrial uses, like refining oil or manufacturing fertilizer.

And clean hydrogen is not currently produced at the scale that would be needed for it to replace metallurgical coal.

Most of the hydrogen produced today is made using fossil fuels, without carbon capture technology. When that’s the case, emissions are lower than using coal, but still nowhere near net-zero. 

To truly get to zero-emission hydrogen, the industry would need to move to hydrogen produced from water through electrolysis and powered by clean energy. That’s what’s known as green hydrogen. 

Hörnfeldt told The Narwhal his company is building a facility to make its own green hydrogen, and Hybrit recently announced it is also building a pilot project that will store green hydrogen 30 metres below the earth’s surface in a rocky cavern.

He added that Sweden’s “virtually CO2-free power grid” — the country relies heavily on nuclear, hydro and wind power — makes the use of green hydrogen easier. 

But for other parts of the world, such as Alberta, there is a middle ground, and that’s what’s called blue hydrogen. It’s still generated from fossil fuels, but with a robust carbon capture and storage plan in place. 

In the Edmonton region, advocates say hydrogen production could catapult Alberta into a leading role in a net-zero economy. Alanna Hnatiw, mayor of Sturgeon County and chair of Alberta’s Industrial Heartland Association, said a major investment in hydrogen could “insulate the market here away from the winds of the global economy.” The region is the subject of plans for a “hydrogen hub” that produces hydrogen from fossil fuels and captures the resulting carbon. Photo: Sturgeon County

According to a recent report from Clean Energy Canada, a climate and clean energy program at Simon Fraser University that works to accelerate an energy transition, Canada is “among a small group of countries with the most potential for producing and exporting clean hydrogen, which could prove particularly useful in decarbonizing industries like steel.” 

It’s something that some Albertans are very excited about.

A grand vision for the province was unveiled last year, with the launch of the Industrial Heartland Hydrogen Task Force. The task force officially launched a so-called hydrogen hub or node in the Edmonton area in April, with the goal of producing blue hydrogen for use locally and for export. 

Advocates are adamant that hydrogen, regardless of whether it’s blue or green, represents a way of making steel that dramatically reduces the carbon footprint of the steel industry. Others worry that blue hydrogen represents a prolonging of the province’s dependance on fossil fuels.

Either way, as more steel-making companies using hydrogen-based methods enter the market, the demand for hydrogen could rise globally.

Steel manufacturers, automotive companies push for green steel

ArcelorMittal, which describes itself as the largest steel manufacturer in Europe, the Americas and Africa, recently announced plans for what it calls the “first industrial scale production” of iron produced entirely with hydrogen, to be deployed at its Hamburg plant, with an annual production of 100,000 tonnes of steel. 

To start, ArcelorMittal, which produced nearly 90 million tonnes of crude steel in 2019, will rely on hydrogen generated from fossil fuels, but the company will switch to green hydrogen as it becomes available and economical. Using hydrogen instead of coal, it has said, is “part of our Europe-wide ambition to be carbon neutral by 2050.”

Then there’s the American startup, Boston Metal. It got its start at the Massachusetts Institute of Technology, and boasts that it is working toward “a world with no pollution from metals production.” 

The company uses a process called molten oxide electrolysis, which skips coal and can make steel straight from iron ore using electricity alone. NASA was an early partner, and is exploring the idea of using the process to produce metals from “lunar resources” for “lunar in-space manufacturing.”

The production of pure iron is responsible for the lion’s share of carbon pollution in the conventional steel-making process. SSAB has predicted its coal-free plants — which produce pure iron, seen here, using hydrogen instead of coal — will reduce Sweden’s carbon pollution by 10 per cent and Finland’s by seven per cent. Photo: SSAB

Here on earth, some companies are starting to demand greener options for their materials. German car manufacturer BMW, which processes half a million tonnes of steel annually in its European plants, has made plans to invest in lower-emission steel. 

“We have set ourselves the goal of continuously reducing CO2 emissions in the steel supply chain,” the company has said in a press release, noting it is “already working with suppliers who use only green power for the steel they produce for us.”

That could mean increased demand for steel from companies like SSAB, which recently announced plans to partner with Volvo on fossil-free trucks. “We can see that the automotive industry in general is really interested in this for the simple reason that we are on the pathway of eliminating tailpipe emissions from passenger cars,” Hörnfeldt said.

“And when you get rid of the tailpipe emissions, then the major environmental impact on the vehicle comes from materials that are used in that vehicle.”

In other words: steel.

Questions about cost competitiveness

There remains a lingering question surrounding the push to manufacture steel using hydrogen. How much will it cost?

Using clean hydrogen is “going to be somewhere between 20 and 40 per cent more expensive than using coal,” Bataille said. 

“We firmly believe that this is going to be a competitive technology over time,” Hörnfeldt said, noting a 2018 SSAB analysis estimated fossil-fuel-free steel would be 20 to 30 per cent more expensive than conventional steel.

“But that gap will close,” he said, explaining the price of fossil-fuel-free steel will go down as the cost of emissions increases. “Coking coal will become more expensive and green energy will become less expensive.”

“All of these things have already happened,” he said.

“The higher the cost of carbon, or carbon price, the more economical these technologies become.”

According to a 2020 report from McKinsey, conventional steel-making companies face economic risks in the near future. The institute cites findings that companies may lose value if carbon pricing outpaces their ability to decarbonize.

Governments, of course, have huge impacts on the feasibility of any form of clean technologies, in the form of carbon pricing.

“What is economical depends on what kind of incentives are available,” Amit Kumar, professor of mechanical engineering and Natural Sciences and Engineering Research Council of Canada industrial chair at the University of Alberta, previously told The Narwhal. “The higher the cost of carbon, or carbon price, the more economical these technologies become.”

Companies that require steel, like in automobile manufacturing, have begun to signal they are looking for lower-carbon alternatives, adding an additional incentive for steel-making companies and potentially driving down costs as demand rises. Photo: Shutterstock

Alberta still eyeing new coal developments as consultation begins

Following months of backlash to the government’s plans to rescind the 1976 coal policy, Energy Minister Sonya Savage announced in March that the province will begin consultation on a new coal policy. 

That hasn’t stopped the pushback, nor has it paused progress on some metallurgical coal mines proposed in the province, such as the Grassy Mountain and Tent Mountain projects. In neighbouring B.C., new metallurgical coal mines are also moving their way through approval processes.

As industry and advocates alike call for the decarbonization of steel, one of the world’s most emission-intensive industries, there are increasing concerns that governments are putting their eggs in the wrong basket.

For Bataille, the energy economics professor, the writing is on the wall. Coal, he said, is a “resource that’s going to be probably going out of business within a generation.”

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The continuous flow of dangerous pollution from B.C.’s Elk Valley coal mines into a Montana watershed is a top discussion item for Canadian and U.S. delegates convening at a bilateral meeting in Washington, D.C., Thursday.

Selenium from five metallurgical coal mines owned and operated by Teck Resources has been leaching into B.C.’s Elk River and flowing southeast into Montana’s Kootenai River watershed for decades. Contamination levels measured in U.S. waters exceeds maximum concentration limits outlined by the U.S. Environmental Protection Agency.

Selenium is released from waste rock piled at Teck’s large-scale open-pit coal mines, where rainfall and snowmelt draw it into the Elk and Fording Rivers. Selenium can be harmful to biological organisms at even small amounts and causes deformities in fish and birds.

Michael Jamison, program manager with the National Park Conservation Association’s Glacier Field Office in Montana, said it’s a good sign the pollution of the transboundary watershed is on the bilateral agenda.

“People have been discussing the transboundary water issue between B.C. and Montana as a potential agenda item for the bilaterals for over a decade,” Jamison told DeSmog Canada. “They’re finally there.”

The decades-old problem of contamination received new attention from top U.S. officials, including former Secretary of State Rex Tillerson, who vowed to put pressure on his Canadian counterparts to address the ongoing pollution problem.

Montana Senator Jon Tester has been raising the profile of the issue for years, saying the Kootenai watershed, which is a popular spot for recreational fishing and outdoor activity, is threatened by B.C.’s pollution.

Tester pushed for the Kootenai to be included in the recent U.S. government-spending bill, signed by President Donald Trump, which lists reducing the pollution flowing into the watershed as a budget priority.

“It seems like there’s some traction here that we’ve been missing for some time,” Jamison said.

“But this is what baffles me — it’s bad enough that us in Montana, the U.S. State Department and tribes on this side of the border are prioritizing it. But it must be so much worse farther north.”

“I guess I don’t understand how B.C. puts up with that.”

Teck was the single largest donor to the BC Liberal party, which governed B.C. for 16 years until last year. Between 2008 and 2017, the company gave $1.5 million to the BC Liberals. The company also donated $60,000 to the B.C. NDP in that same period.

Teck’s ongoing selenium nightmare

The reality of Teck’s selenium problems have unfolded over the last decade as the company has tried — unsuccessfully — to introduce an effective water treatment facility.

In October 2017 Teck pled guilty to three violations of the federal Fisheries Act for its pollution of the Elk River and was fined $1.4 million for a 2014 fish kill near the company’s Line Creek wastewater treatment plant.

The $600 million water treatment plant had only been in operation for four months when the fish kill — which included local bull trout, a species of special concern — occurred.

An expert report prepared for Environment Canada in 2014 found selenium poisoning caused spinal, head and skull deformities, missing fins and disfigured gill plates in fish eggs brought to laboratories to be hatched.

“As these surface mines have expanded, so has the volume of their selenium-laden water discharges to nearby stream and rivers,” Dr. Dennis Lemly, research associate professor at Wake Forest University in North Carolina, wrote in his report.

Lemly warned the Elk River watershed was at a tipping point and that further increases in selenium concentrations could lead to a “total population collapse of sensitive species such as westslope cutthroat trout.”

Erin Sexton, senior scientist with the University of Montana’s Flathead Lake Biological Station told DeSmog Canada that B.C. has granted permits for Elk Valley mines that allow for selenium levels ranging from 70 micrograms per litre to 19 micrograms per litre while the provincial criteria for protection of aquatic life is 2 micrograms per litre.

U.S. EPA regulations limit acceptable selenium pollution levels to 1.5 micrograms per litre.

Jamison said the rules don’t seem to apply to Teck’s mining operations in B.C. even after the company has been found to be in violation of provincial regulations.

“The regulators up north said, ‘nah that’s cool. As long as you promise you can fix it, you get your permit,’ ” he said.

“Whereas down here we have different methods to review, permit, monitor and regulate mines. And there’s not a lot of wiggle in it.”

“The lines seem to be drawn in ink on the U.S. side, and in pencil on the Canadian side.”

In the fall of 2017 Teck shut down the Line Creek water treatment plant after it found the facility was releasing a more bioavailable and thus more toxic form of selenium into the region’s waterways. Teck has since notified the B.C. government the treatment plant will be offline until 2018.

“Teck has invested millions in multiple treatment technologies, and at least twice they have shut down their one and only treatment plant, due to impacts to fish,” Sexton told DeSmog Canada.

“First for a fish kill, and now for a technology ‘error’ resulting in bio-concentration of selenium in the wastewater — the exact opposite intent of the treatment.”

Sexton, who has studied transboundary water quality for the last decade, said Teck and the B.C. government have not been forthcoming with their data on these issues.

“Frankly, we collected our own data in the Elk River system — the Flathead Lake Biological Station collected data for water quality and bugs — and Montana Fish and Game collected data for fish — because of the lack of data availability, transparency, and scientific objectivity that has characterized this issue for over a decade,” she said.

B.C. Minister of Environment George Heyman was unable to provide comment by time of publication.

“The lines seem to be drawn in ink on the U.S. side, and in pencil on the Canadian side.” https://t.co/f5UhxC79WC

— DeSmog Canada (@DeSmogCanada) April 26, 2018

Mine permits issued despite Teck’s prolonged pollution problems

Dave Hadden, executive director of Headwaters Montana, said he’s pleased to see the Kootenai listed on the bilateral agenda, but is concerned neither short-term nor long-term solutions are clearly at hand.

“This is a multi-century problem,” Hadden told DeSmog Canada. “The problem is not going to go away and there needs to be a mechanism that finds a solution for addressing a multi-century problem that is fair to Canada, fair to the U.S. and that provides mitigation for these impacts.”

Headwaters Montana is one of a coalition of groups asking B.C. follow international water quality standards before new Elk Valley coal mines are approved.

Lars Sander-Green from B.C. conservation group Wildsight said B.C. actively grants permits and approvals to Teck that not only maintain operations but allow for expansion.

“It’s more than just up and running. In order to continue mining and exporting coal they continue to expand their footprint, which means expanding their waste rock piles and the selenium problem,” he told DeSmog Canada.

A 2016 report from B.C. auditor general Carol Bellringer found it concerning that permits were granted to Teck Resources to expand its Line Creek Mine after staff at the Ministry of Environment found an expansion of the mine would exacerbate selenium pollution problems.

At the time, the BC Liberals granted a permit for the expansion invoking — for the first time in B.C. history — section 137 of the Environmental Management Act, which allows government to introduce waste into the environment if deemed in the public interest.

“Perhaps we should be looking at a temporary moratorium, additional fines or compensatory mitigation with biological offsets in other areas given the legacy of impacts they have created in the Elk,” Sexton said.

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Coal, the fossil fuel that largely sparked the industrial revolution, may be facing the beginning of the end — at least in terms of generating electricity.

There are increasing signs of the demise of the world’s dirtiest fossil fuel, from a global oversupply to plummeting prices to China starting to clean up its polluted air.

Last week, the Carbon Tracker Initiative published an analysis — Carbon Supply Cost Curves: Evaluating Financial Risk to Coal Capital Expenditures — identifying major financial risks for investors in coal producers around the world.

Saying the demand for thermal coal in China, the world’s largest emitter of toxic greenhouse gases, could peak as early as 2016, the analysis also highlights $112 billion of future coal mine expansion and development that is excess to requirements under lower demand forecasts.

“In particular it shows that high cost new mines are not economic at today’s prices and are unlikely to generate returns for investors in the future,” said an accompanying media release.

“Companies most exposed to low coal demand are those developing new projects, focused on the export market . . . With new measures to cap coal use and restrict imports of low quality coal in China, it appears the tide is turning against the coal exporters.”

The analysis added that China’s desire to reduce imports will impact prices and asset values for export mines in the U.S., Australia, Indonesia and South Africa.

“King Coal is becoming King Canute, as the industry struggles to turn back the tide of reducing demand, falling prices and lower earnings,” Anthony Hobley, CEO of Carbon Tracker Initiative, said.

A recent article in Mining Weekly also says the coal industry is indeed facing tough times.

The article noted Coal Association of Canada president Ann Marie Hann agreed that about half of the global coal output at current pricing was being produced at a loss.

“Until a global rebalance between demand and supply takes place and the global economy rebounds, the coal industry will unfortunately probably see some more bad news over the coming months,” Hann said.

The story added that the prices for thermal coal, which is used to generate electricity, had fallen in recent years from about $190 per tonne in mid-2008 to $75 per tonne this year, while metallurgical coal (used to make steel) had dropped from a high of more than $300 per tonne in late 2011 to less than $120 per tonne.

To perhaps make matters worse for the coal industry, it is being publicly attacked by the oil and gas sectors, which are trying to position themselves as cleaner fossil fuels.

According to the Responding to Climate Change website, a number of the world’s leading oil and gas companies voiced their concerns about climate change at last week’s UN Climate Summit, arguing they can offer a future coal cannot.

“One of our most important contributions is producing natural gas and replacing coal in electricity production,” Helge Lund, Statoil’s chief executive, was quoted as saying.

Kevin Washbrook, a director for Voters Taking Action on Climate Change, a Vancouver organization that has fought against a proposed new coal export facility at Fraser Surrey Docks, agrees the thermal coal sector is in decline.

“I think coal is in everyone’s sights these days because coal is climate change,” Washbrook told DeSmogBlog. “Coal has to be on the chopping block for sure.”

Washbrook added the UN, the International Energy Agency, big banks and insurance companies are acknowledging that the vast majority of coal must stay in the ground if humankind is to avoid catastrophic, runaway climate change.

“We need to see this current downturn [in the thermal coal sector] for what it really is — our last good opportunity to leave coal behind and start the transition to emission-free energy sources.”

Photo Credit: Arnold Paul, Wikimedia Commons

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