On 27 April 2015, the National Energy Administration (NEA) released the Action Plan for Clean and Highly-efficient Utilization of Coal (2015-2020). This is the latest of several recent documents that put coal under heavier scrutiny. This comes as no surprise given China’s ‘war on pollution‘ declared by Li Keqiang last year and coal’s links to pollution. Coal not only has implications for air quality but for water quality & reserves as well, especially in the dry North which heavily relies on groundwater. The very same groundwater that is already under much pressure.
Properly managing the mine water (drainage, treatment, reuse) is crucial if China is to limit harmful environmental impacts of coal mining. Several targets have been set in this purpose, sometimes even conflicting with each other. Much murkiness remains around coal mines: will they reach the target of mine water reuse? As much as 95% of mine water should be reused in water stressed areas by 2020. And how much water do these mines actually use? With coal regulatory landscape getting more and more stringent, and civil society growing more and more impatient, it is time for coal mines to clear the waters and shed more transparency on their activities.
Coal mining & stressed water resources
Coal will remain China’s vanguard for energy in the foreseeable future, which obviously comes with serious air and water pollution concerns. Coal also competes with agriculture for water thereby creating stress between water, food and energy security.
We have for a long time spoken about the mismatch of water resources and coal reserves (see here for instance). Last month, we took a deeper dive into this in our report titled “Towards a Water & Energy Secure China” (hereafter referred as the report). Our analysis shows that more than 90% of China’s coal production comes from 14 large coal bases, spread over 12 provinces and autonomous regions (see chart below: the 12 Coal Base Provinces are singled out with a black label): six of these 12 Coal Base Provinces are water-scarce (with Hebei, Henan and Ningxia even running a water deficit), three are water-stressed whilst three are water-rich. These 12 Coal Base Provinces also rely heavily on groundwater with 31% of total water supplied by groundwater compared to the national average of 18%. On top of this, over 70% of deep and shallow groundwater in the North China Plain is polluted.
Pollution from coal mining threatens groundwater
Also highlighted in our report, the amount of water used for cooling purposes in coal-fired power plants far exceeds the amount of water used for coal mining and processing. However, coal mining poses a serious pollution threat, both to groundwater and surrounding surface water.
It is estimated that between 1m3 and 2.5m3 of groundwater reserves is destroyed per tonne of coal mined(1). The so-called mine water is the water already present or flowing into the mine and which should be collected (drained) for the mine to be operated. This mine water can be contaminated in different ways and intensity levels, depending on the geological conditions and mining processes. Typical contamination can include acid chemicals, heavy metals and wastes from the mining process. If not properly collected and treated, mine water can have serious pollution impacts on both groundwater and surface water. On top of that, reusing the mine water can help reducing the amount of water withdrawn from limited resources.
Need to reuse mine water, but do we follow MWR/MEP’s targets or NEA’s?
Adequately managing this so called mine water is therefore crucial for limiting environmental impact of mining activities. Doing so firstly requires the proper drainage and treatment of the mine water. Then, mine water can be reused either for coal or other industrial processes, for landscape purposes or for municipal use. On top of limiting pollution, this also limits the consumption of scarce water reserves.
Reusing mine water has been repeatedly called for in recent policies
China’s different authorities are well aware of that and the increased reuse of mine water has been repeatedly called for in recently issued policies. To mention only those issued in the last month or so: the Circular Economy Promotion Plan for 2015, the Opinions on Accelerating the Construction of Ecological Civilization, the Water Ten Plan, the Action Plan for Clean and High-efficient Utilization of Coal (2015-2020).
In the Water Ten Plan, Chinese miners are expected to increase mine water utilisation rate and to prioritize the use of mine water in the mine refill, for production purposes and for municipal water use. The NEA’s Action Plan for Clean and Highly-efficient Utilization of Coal sets precise targets for 2020: the reuse rate of mine water should be:
- 95% in water scarce regions,
- 80% in less water-stressed regions and
- 75% in water rich areas.
Interestingly, these values are less stringent than these set by the Ministry of Water Resources (MWR) in its Water-for-Coal Plan issued in December 2013 (see here for a discussion of this plan). This latter plan required large coal bases to reach a reuse rate of:
- 100% in water scarce regions,
- 90% in less water-stressed regions and
- 80% in water rich areas.
This corresponds to the Grade I of the MEP’s Coal Mining Clean Production Standard HJ 446-2008. In other words, MWR/MEP’s targets are more stringent than NEA’s.
Should large coal bases abide by MEP/MWR’s more stringent targets? Or NEA’s lower requirements?
Hence the murkiness: do large coal bases still have to comply with the MEP/MWR’s targets?
Since large coal bases will represent 95% of coal output by 2020 (as required by the Energy Development Strategic Action Plan), the answer to this question has much influence. Besides, why do the new NEA targets only meet the Grade II of this standard? Is it that MWR is losing its battle against coal miners or local governments? Is it simply a lack of coordination? Or is it that these initial targets were too ambitious and NEA doesn’t think these could be achieved?
In 2013, the average utilisation rate of mine water was 65%, up from 59% in 2010 (see right chart). In its 12FYP, the government set a target to increase this national average up to 75% by 2015.
Will this target be met in time? If not, what penalty will coal miners face?
China’s continuous policy to shut down small and old mines can certainly help. In 2015, an additional 1,254 coal mines representing 78 million tonnes of annual production capacity should be shut down (see here for a list of provincial targets in Chinese).
Discrepancy in the mine
Uncertainty not only surrounds levels of mine water reuse in the future but also levels of freshwater use for coal mining and processing (as highlighted in our report pg 117), also suffers much discrepancy. In the chart (below), we compare the water used for mining and processing one tonne of coal according to different sources.
When considering water use in coal mining and processing, values range between 0.2-4.8 m3 per tonne of coal: a 24-fold variation. Most probably the actual water use lies somewhere in between.
Other estimations of water use along the coal chain by different institutions also show stunning amplitude (more details in our report).
More transparency needed in the coal sector
But the key issue here is to make sure all the sources are analysing the same thing. We can’t go on without a proper industry benchmark. Clearly, we need more transparency in the coal mining and industrial sector. However, murkiness can also be found in the discrepancy between official standard themselves.
Heterogeneity among national standard and local water use quotas
Along with national standards, several provinces have also issued water use quotas for coal mining and processing (see our report pg 118 for more details). In the chart below, we represent the maximum levels of water use for coal mining according to a national standard and provincial water use quotas (for Inner Mongolia and Shanxi, the two largest coal producers). As it can be seen, these different water quotas and standards differ. Here also, there is much room for harmonisation of official requirements.
Thanks to the ‘Strictest Management System of Water Resources’ also known as the ‘Three Red Lines’ policy, local governments are now fine-tuning the water use quotas for industries in order to remain within their water use red lines. Since MWR’s ‘Water-for-Coal Plan’ is also part of this policy, we wish water use quotas could be set in accordance to the MEP/MWR’s most stringent targets.
Regardless of the targets retained, coal mining will be keep attracting much attention, both from central authorities and civil society. As highlighted in the ‘Water Ten’ action plan, large water users will be more closely monitored, and this will certainly include much of the coal sector. In this context, coal miners should better play the compliance and transparency cards.
1 Pan, L., Liu, P., Ma, L., & Li, Z. (2012). A supply chain based assessment of water issues in the coal industry in China. Energy Policy, 48, 93–10; Chinese Academy of Sciences (CAS), Greenpeace East Asia (2012). Thirsty Coal: A Water Crisis Exacerbated By China’s Mega Coal Power Bases, China Environmental Science Press.
- Groundwater Under Pressure - New official survey says that China’s groundwater quality has yet again deteriorated. Can the ‘Water Ten Plan’ turn this around? Who will be affected? Hear from China Water Risk’s Hu on what’s at stake & why the next 5 years are crucial
- China: Not Ready To Move Away From Coal - Professor Xie Kechang, Vice President of the Chinese Academy of Engineering, on the future role of coal, strategies to ensure energy security & challenges ahead for coal-to-chemicals
- Water Drives Coal Reform - To ensure energy security, China needs to protect its No 1 fuel source against water scarcity. Feng Hu takes a closer look at what the new water-for-coal plan and other related policies mean for coal and coal-related industries
- Water for Coal: Thirsty Miners? - With up to 83% of China’s coal reserves in water stressed & scarce regions, the recent CLSA report asks if there is enough water to grow coal production. If not, what are our options? Debra Tan expands