Coleman on energy access lessons from Peabody Energy's demise
Peabody Energy just declared bankruptcy after years of financial instability owing to sustained low natural gas prices, the increasing social and environmental cost of burning coal, and other market factors. One of the companies’ last ditch efforts to remain relevant was the launch of their Advanced Energy for Life campaign created to promote coal development as a way to lift the poor out of poverty and provide lasting energy access.
The campaign was a flop. First, it was conceived on the misguided premise that it would be profitable in the near-term to export coal to developing countries like India to address access needs. Second, “poverty washing”, as Oxfam has called it, doesn’t sell. Peabody itself has zero investments and gives zero donations related to alleviating energy poverty. And in the UK, the company was sued by WWF for false advertising on based on untrue environmental claims in their campaign and WWF won causing Peabody to retreat.
Interestingly enough, Peabody’s industry peers have made some investments related to energy poverty in developing countries, but none have involved coal mining or coal infrastructure. The Australian Institute names a few: the Indian coal company Adani provides solar-powered street lighting to rural areas in India; BHP Billiton supports solar projects in Pakistan; and the Thai coal company Banpu built a mini grid for villages near a mine in Indonesia powered by a diesel generator. One concludes that these companies perhaps understand that it doesn’t make economic sense to use coal-fired power to address energy poverty needs head on.
So what lessons does the Peabody collapse provide in terms of coal and energy access moving forward?