A few months ago, Czech utility EPH struck a blow by finally announcing a coal phase-out date of 2030. The problem? This coal phase-out announcement is totally misleading, with the mere transfer of the group’s coal activities to … a new company linked to the group. A perfect counter-example of what should be done: get out of coal for good by 2030 and initiate the move away from gas, starting by halting new projects.<\/strong><\/p>\n<\/div> For many years, Daniel K\u0159et\u00ednsk\u00fd’s energy group has been using every trick in the book to slow down the gradual phase-out of coal in Europe, and to continue exploiting this harmful resource (1). The Czech utility specializes in buying up coal mines and coal plants at the end of their lives. Until now, its strategy has been to operate them for as long as possible, even if that means delaying coal phase-out in certain EU member states (2), and to take advantage of public funds (3).<\/p>\n<\/div> A few months ago, EPH announced a coal phase-out date of 2030 (4). Yet, analysis shows that the announcement is not even worth the paper it is written on. EPH\u2019s coal assets will simply be transferred to a new company, created for the occasion and aptly named EP Energy Transition. This new structure is not subject to the coal phase out announcement, and may therefore continue to operate coal assets well after 2030.<\/p>\n Thanks to this sleight of hand, the group can boast that it is now almost free from its coal assets and that it will completely abandon coal as a power generation source by 2030. In reality, the effective coal phase-out date for these assets remains unchanged to 2038.<\/p>\n<\/div> While the group was already listed in the Global Coal Exit List (GCEL) as a company to divest from, EPH made a dramatic entry into the latest version of the Global Gas & Oil Exit List (GOGEL) in mid-November 2023 (5). The Czech utility is listed as the second-largest gas power developer in Europe with more than 4.7 GW in development, following closely on the heels of France’s EDF.<\/p>\n These developments are in direct contradiction with the commitments made by many European countries. In December 2023, seven European countries – including Germany, where EPH plans new gas plants – representing almost half of the European Union’s power generation, committed to decarbonising their electricity production by 2035 (6).<\/p>\n This announcement reflects the findings of leading scientific studies, including those of the International Energy Agency (IEA). According to the IEA, in order to limit warming to 1.5\u00b0C, global electricity production must be completely decarbonized by 2040. European and OECD countries have a responsibility to lead the way, by building carbon-neutral power systems by 2035. The role of fossil gas in these future carbon-neutral power systems is unequivocal. The IEA’s NZE scenario forecasts a 22% drop in gas consumption in the global electricity sector compared with 2021 levels by 2030 and a 93% drop by 2040, making it the sector where gas consumption declines most rapidly (7).<\/p>\n<\/div> At a time when several European countries have just announced a target for decarbonising their electricity production by 2035, European financial institutions are faced with a choice. They can either continue to support EPH and gamble on Europe’s inability to meet its own climate targets – and often their own commitments in this area – or withdraw any further support for the Czech company.<\/p>\n Because EPH has no shareholders, it is left to the banks to act. While most French banks ended their support for the group years ago, Soci\u00e9t\u00e9 G\u00e9n\u00e9rale continues to finance it. Soci\u00e9t\u00e9 G\u00e9n\u00e9rale\u2019s Czech subsidiary, Komercni Banka, is a long term and consistent collaborator with EPH (8).<\/p>\n Reducing greenhouse gas emissions requires both stopping the burning of fossil fuels and speeding up the development of solutions. Banks – including Soci\u00e9t\u00e9 G\u00e9n\u00e9rale – must act on both fronts. New support for utilities must be conditional on:<\/strong><\/p>\nA misleading announcement on coal phase-out<\/h2><\/span>
EPH opens the door wide to another fossil fuel: gas<\/h2><\/span>
Banks must act to halt EPH’s disastrous strategy<\/h2><\/span>
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