Mine closure in the coal industry: Global and national perspectives

For over a century, coal has provided much of the energy for development worldwide. The literature has documented the adverse environmental and social aspects of coal mining (Obeng-Odoom, 2020a). However, the threat of global warming means that the world is now looking for cleaner forms of energy. The EU (European Union), for example, has a transition policy that will help to make Europe carbon neutral by 2050. In May 2019 the United Kingdom had its first week without using coal-generated energy. By 2030, more than half of India’s electricity capacity will be renewable. The pressure for cleaner forms of energy comes from the Paris Agreement, which compels signatories to limit greenhouse gases, and from banks, which are increasingly wary of financing coal for reputational reasons particularly as it grows increasingly uncompetitive. Coal-powered energy provision will inevitably decline and large numbers of coal mines will close.

South Africa’s economy is still heavily dependent on coal, the source of over 90% of its electricity and 20% of its liquid fuels (Department of Energy, 2015). This dependency is bound to change. New coal plants are now more expensive than renewable energy across most of the world, and in many major markets, new renewable energy is cheaper than the running costs of coal plants. South Africa has also signed the Paris Agreement to reduce greenhouse gas emissions. In practice, this means the country must close all its coal-fired plants (Simelane and Abdel-Rahman, 2011; McCall et al., 2019), which will cause a huge reduction in production and employment in the coal mining industry (Burton, Marquard and McCall, 2019). South Africa has embarked on a renewable-energy programme, but the programme has not received universal support. Workers and unions in the coal industry are actively campaigning against the renewable programme, while some analysts also argue that the apparent costs/benefits are more complex than anticipated. For Emalahleni, these debates are real, as the economy is built on coal.

This expected decline in local demand for coal is likely to coincide with a decline in the demand for exported coal. Countries to which South Africa has been exporting coal are also actively looking for cleaner sources of energy. Asian demand for coal is likely to fall given the growing uncompetitiveness of coal versus wind and solar, and energy, climate change, industrial, and air pollution policies that drive shifts away from coal (Fei, 2018; Sartor 2018). India, for example, has downscaled its construction of new coal-generated power plants substantially over the past few years (Strambo, Burton and Atteridge, 2019).

In the previous chapter we discussed the call for a ‘just transition’. We now switch from that idealistic perspective to consider the practical consequences of mine decline and closure. We highlight the need to address the social aspects of mine closure and we look at  international perspectives on the topic. We argue that normative approaches such as those advocated in the just transition literature are essential but must be careful not to overlook the socio-economic realities and complexities that mine closure brings.