In response to diversified resource company Glencore’s coal capping announcement last month, the World Coal Association (WCA) maintains that coal is a vital energy and strategic resource.
It says coal is essential to the world’s sustainable development and energy security objectives and plays an indispensable role in addressing energy poverty, supporting urbanisation and delivering economically competitive energy to support modern economies in developed and developing countries.
WCA is the only body working at an international level to secure the long-term sustainability of the coal sector, bringing together stakeholders to help the industry respond to the challenges and opportunities it faces, encouraging innovation, and supporting members to be industry leaders.
WCA’s position on climate and energy has always been clear – it supports a balanced approach that integrates climate and energy policy that works towards a low emissions future.
The Paris Agreement commits signatories to holding the increase in the global average temperature to well below 2 ºC above preindustrial levels and pursuing efforts to limit the temperature increase to 1.5 ºC above preindustrial levels. WCA recognises this objective.
Many countries have recognised a role for low emission coal technologies in their climate pledges submitted as part of the Paris Agreement and WCA has long acknowledged the international imperative of action on climate change, particularly the importance of carbon capture, use and storage in meeting its climate objectives.
Glencore, meanwhile, says in its report, it recognises climate change science as set out by the United Nations Intergovernmental Panel on Climate Change, and believes that the global response to climate change should pursue twin objectives: both limiting temperatures in line with the goals of Articles 2.1(a)1 and 4.12 of the Paris Agreement and supporting the United Nations Sustainable Development Goals, including universal access to affordable energy.
To deliver a strong investment case to its shareholders, Glencore must invest in assets that will be resilient to regulatory, physical and operational risks related to climate change.
Following engagement with investor signatories of the Climate Action 100+ initiative, Glencore has aspired to a Paris-consistent strategy.
Glencore believes that it is appropriate that it takes an active and constructive role in public policy development and to participate in relevant trade associations. Glencore acknowledges “the Institutional Investors Group on Climate Change investor expectations on corporate climate lobbying” and recognises the importance of ensuring that its membership in relevant trade associations does not undermine its support for the Paris Agreement and the Paris Goals.
Glencore will consider whether its membership in relevant trade associations aligns with the company’s stated positions in this statement. The result of this review, including any material misalignments identified and actions that will be taken, will be made public this year.
By the same token, multinational mining company Anglo American also released its results late last month, and when asked whether the company would follow suit, Anglo American CEO Mark Cutifani insisted that the company had already reduced its foot- print by half in the past three years.
Anglo had already taken steps, and was continuously talking about transition in terms of its position, taking into account all of the contributing factors.
“Over time, our footprint will continue to drop, in a sensible way consistent with our obligations to customers, governments and in particular local communities and employees.”