When Coal Comes to Paradise
As China pushes clean energy policies at home, it is exporting its high-pollution coal industry to pristine places like Kenya’s Lamu Island—with Nairobi’s seal of approval. Local residents fear it will destroy the environment they depend on.
LAMU, Kenya—China’s ambition to become a world leader on climate change has led its government to pursue an ambitious initiative to reduce emissions domestically. Amid massive reforms to switch to cleaner energy sources such as natural gas, China has barred new coal plants in 10 regions and proposed suspending construction of more than 100 coal plants last year.
China’s carbon-dioxide emissions grew by 2.3 percent in 2018, and are set to peak in 2030. (There has been some easing of restrictions, Bloomberg reports, indicating how coal-dependent China remains.) Still, the growth is slower than climate researchers expected. With investments in alternative energy increasing and domestic demand for coal-fired power dropping so quickly, China has been left with a surplus of labor, technology, and equipment. To remedy this, China’s coal industry has been encouraged by the government to look to outside markets for its survival.
While China is on track to meeting its Paris climate agreement targets domestically, it continues to invest in and profit from coal power projects across the world. Domestic restrictions do not apply to projects abroad, and China has capitalized on this exception by exporting its surplus of coal-related equipment and technology to countries desperate for industry, undermining a global push to phase out coal. China has invested in coal projects in 34 countries, 11 of which are in Africa, according to data compiled by Global Energy Monitor’s Global Coal Plant Tracker, an industry watchdog.
China invested in eight of those African countries, six of which have no existing coal-related infrastructure, after its commitment to the Paris climate agreement in 2015. Once completed, these projects would generate 102 gigawatts in coal power globally, locking countries that currently have little to no coal capacity into coal dependency, according to a statement from Urgewald, a German environmental rights group.
Lamu Island, 200 miles north of the Kenyan port of Mombasa, is one of the places that China’s industrial surplus is poised to transform.
Lamu can only be reached by boat. As one approaches the island, Lamu Town, a 14th-century fishing village, appears like a shimmering time capsule of coral limestone, flanked by traditional dhows carved from mangrove wood and crowned by the minarets of Lamu’s dozens of mosques.
Cars have yet to replace the donkeys that weave through Lamu’s narrow streets. Considered the cradle of Swahili Islamic culture, Lamu is a UNESCO Heritage site that retains much of its multicultural heritage, a rich tapestry of African, Arab, and Indian traditions. The Lamu Archipelago’s unique biodiversity has also, for the most part, been left untouched, preserving its sense of paradise for tourists and locals. That, however, is changing.
Lamu has become the contentious centerpiece of the government’s ambitious Kenya Vision 2030 plan, which aims to transform the country into East Africa’s industrial touchstone. As far back as the 1970s, plans for a massive multinational infrastructure project have been on the table, but they have never materialized due to lack of funding. Today, thanks in part to Chinese loans, the newest incarnation is the Lamu Port-South Sudan-Ethiopia Transport Corridor (LAPSSET), which includes a port and coal plant in Lamu County.
According to the LAPSSET’s Environmental and Social Impact Assessment, Lamu County was chosen for its remote location and accessibility for coal shipments. Since Kenya has no infrastructure in place for the transport of coal, South Africa has been granted a contract to import coal to the site until Kenya can build a railway from Lamu to Mui Basin in Kitui County, over 200 miles away, where concessions have been granted to Chinese companies to begin coal mining.
Critics of the project, such as Raya Famau, a Lamu resident and self-described “land defender,” argue that the long-term costs of pollution, water contamination, overpopulation, and imports far outweigh saving a few cents on electricity. Famau saw the effects of coal firsthand when she and other community members traveled to Mpumalanga province in South Africa—where coal for the Lamu plant will be shipped from—and witnessed the effects of coal mining on the local community’s quality of life. “We cannot have this coal project in Lamu,” Famau insists. “In the DRC [Democratic Republic of the Congo], Uganda, Ghana, South Africa, I’ve come to see our struggle as women is the same, especially when it comes to land rights. Women are homebuilders, mothers, wives, [and] farmers. Everything. When you are destroying our livelihood, you’re destroying us.”
The coal project is owned by Amu Power, a Kenyan, Omani, U.S., and Chinese consortium. China, through three companies including state-owned China Huadian Corporation, the world’s second-largest coal plant developer. In 2017, China Power Global signed a $2 billion deal with Amu Power for the coal plant. The Industrial Commercial Bank of China has financed $1.2 billion. In May 2018, the U.S. conglomerate General Electric purchased a 20 percent stake—$400 million—in the power plant. GE says it will “design, manufacture and deliver its ‘Ultra Super-Critical’ clean coal technology components [boiler and steam turbine generator] and air quality control systems.”
With the increased international attention on coal’s spotty track record, many critics have argued that there is no such thing as “clean coal.” The National Institutes of Health call coal-fired power plants in the United States “the biggest industrial sources of mercury and arsenic in the air.” Testifying at a tribunal hearing on LAPSSET, Lauri Myllyvirta, a coal and air pollution expert at Greenpeace, said “the project would emit five to 10 times more air pollution than new coal plants are allowed to emit in China.” Chinese Premier Li Keqiang has himself acknowledged that “environmental pollution is a blight on people’s quality of life.” But transferring that blight from China to other countries seems less of a concern.
Kenya’s debt is $7.3 billion and China is its biggest lender—accounting for 72 percent of bilateral debt. While it’s still too early to see the effects of China’s investments in Kenya, public fear is festering. In December 2018, Kenyan media reported a leaked government audit alleging that the port of Mombasa, 80 percent of which is financed by China, is losing money and that defaulting on loans would result in the port’s transfer to Chinese hands. President Uhuru Kenyatta responded that the issue was “pure propaganda.”
Examples of what is being coined as China’s “debt-trap diplomacy” can be found in countries across the globe, such as in Sri Lanka, where China took control of the Hambantota port after the country failed to pay back a loan. Similar projects in Djibouti and Pakistan prompted Malaysian Prime Minister Mahathir Mohamad to warn of a “new version of colonialism.” Chinese President Xi Jinping rejected the accusation when he pledged $60 billion towards African development last fall.
According to data collected by Global Coal Plant Tracker, China has more than 200 coal projects in 34 countries. Edward Cunningham, a specialist in China’s energy markets at Harvard University, told NPR in April that China is developing or planning over 300 coal plants worldwide. Many of these projects are part of China’s Belt and Road Initiative (BRI), which is expanding infrastructure projects across coastal regions worldwide.
The BRI has a choir of critics—mainly Western governments—who worry that the initiative is a strategic attempt to gain regional political and economic influence through attractive, though opaque, transactional loans rather than the orthodox development loans from lenders such as the International Monetary Fund that come with strings attached. Chinese financing commonly comes with big contracts for Chinese construction companies and labor but few policy conditions like those attached to IMF and World Bank loans.
China’s Global Investments in Coal
As of April 2019, China has financed more than 200 coal projects in 34 countries, according to data collected by Global Energy Monitor’s Global Coal Plant Tracker, an industry watchdog.
|BRI Country||New Projects||First Chinese Projects|
Source: Global Energy Monitor’s Global Coal Plant Tracker (formerly CoalSwarm); base map by 5W infographics
Percentage of total external debt owed to China, in order of each country’s amount of debt.
|Country||BRI country||New projects||First Chinese projects||Coal projects with partial China funding||Country’s external debt (USD)||Amount of debt owed to China||Amount in loans from China (USD)||Latest project date|
|Indonesia||23||$181 billion||$126.7 billion (70%)||$8.6 billion||2017: Indonesia Morowali Industrial Park Captive Coal-Fired Power Plant Phase II|
|Kenya||1||$49 billion||$35.28 billion (72%)||At least $1.2 billion from Industrial Commercial Bank of China||Lamu coal plant|
|Zambia||1||$9.38 billion||At least $6.4 billion (68.2%)||$300 million||2015: Maamba Power Plant|
|Sri Lanka||2||$55 billion||$5.5 billion (10%)||$450 million||2010: Lakyijaya Power Plant|
|Cambodia||2||$11.3 billion||$5 billion (42%)||Not available||2010: Sihanoukville CIIDG power station|
|Zimbabwe||5||$16.9 billion||$3.9 billion (23%)||$1 billion||2018: Hwange Makomo Power Station expansion|
|Tanzania||3||$25 billion||$3.8 billion (15%)||Not available||2016: Mbeya coal plant|
|Ghana||1||$21.396 billion||$3.498 billion (16.3%) since 2000||$1.5 billion||2016: Aboano power station|
|Mozambique||At least 1||$8.274 billion||$2.3 billion (27.8%)||Not available||2018: Niassa coal plant|
|Pakistan||16||$9.1 billion||$1.82 billion (20%)||At least $4.9 billion||2019: Thar block in operation|
|Kyrgyzstan||1||$8.1 billion||$1.7 billion (21%)||$1.7 billion||2013: Bishkek Power Station Units 12 and 13|
|Bangladesh||9||$28.6 billion||$1 billion (2.9%)||$3.639 billion||2019: Phulbari power station|
|Malawi||1||$3.7 billion||$444 million (12%)||$667 million||2018: Kamwamba coal plant|
Source: Global Energy Monitor’s Global Coal Plant Tracker (formerly CoalSwarm)
Such is the case in Lamu, where much of the workforce is Chinese and the locals who have worked on the LAPSSET project, like Hussan Obo, described working conditions as “prisonlike.” In 2018, according to a Rainforest Action Network report, “Agricultural Bank of China, Bank of China, China Construction Bank, and ICBC were responsible for 71 percent of finance from major global banks for the coal mining subsector, and 55 percent of coal power finance.”
Anzetse Were, a Kenyan international development economist, believes there is reason for concern. “In Kenya, our debt has doubled in five years under the Kenyatta government, and that is problematic and concerning,” she said. “We are aware of the resource curse. There have [been] tensions in areas of the country that have a lot of commodities, especially when it comes to distributing the profits from those resources.” She doubts Kenya can come up with the money to make good on its loans and support long-term infrastructure projects, which will fall on the shoulders of everyday Kenyans.
Kenyan leaders have defended the borrowing spree, saying they will manage. The tensions Were alludes to have flared in Lamu. Tourism makes up the bulk of Lamu’s economy and is slowly coming back to life after years of regional instability due to al-Shabab militant attacks, but small-scale farming and fishing are the backbone of economic sustainability for most people living in Lamu County—and coal production could pose a dire threat.
Morning prayers have ended, and local fishermen sit languidly along Lamu Town’s marina in the rising sun. It’s high season for tuna, lobster, kingfish, and barracuda but the books at Lamu’s Beach Management Unit show that only three of the 15 boats that went out in the last few days listed a catch.
At Mokowe landing, a short sail from Lamu Town, Bashir Abdi weighs the morning catch, handing the fish over to his brothers who pack them on ice to be shipped to Mombasa. “The catches are very small,” he says. “We used to bring in 250 kilos; now it’s 100, even 80 kilos. That’s not even enough for petrol.”
The fishermen invariably complain that dredging for the construction of Lamu’s port about 10 miles away is the cause of dwindling numbers of fish. They speak of police barring access to traditional fishing areas and increases in dead fish from warming waters pushing them out to the high seas, where their wooden dhows cannot take them.
Dredging for the Lamu port has already destroyed mangrove forests, coral reefs, and traditional breeding areas for fish and other wildlife which local communities have depended on for their food and livelihoods for centuries. Conflicts over compensation, jobs, and land rights have also intensified, resulting in legal cases and protests stalling the coal plant project over the last few years.
“There will be population pressure in Lamu,” says Sam, a boat captain, after dropping off a group of Chinese workers who come to the island once a week to shop. “Lamu is so small. Those projects are very big ones. So many people will be coming to Lamu … and that will bring so many effects—pressure on population, prostitutes, some people won’t get jobs. What will they do?” he asks. “And there will be poverty. Those fishermen are working there and the water is polluted. Their poverty will increase.” The environmental and social impact assessment estimates that Lamu County’s current population of 112,252 could swell to over 1 million people.
Walid Ahmed Ali is the founder of Lamu Youth Alliance and a member of Save Lamu, a grassroots coalition of more than 35 community groups against the coal plant. Ali regularly visits what locals call “the box,” the 975 acres Amu Power has allocated for the coal plant. Once home to subsistence farms and indigenous tribes such as the Aweer, the land, assessed by the government as “undeveloped,” now lays barren as if hit by a natural disaster. He says communities were evicted without adequate consultation or compensation.
The only structure in sight is a water tower with an Amu Power logo. The destruction of mangroves is painfully visible when sailing to the “box.” Mangroves are natural carbon storers, their wood essential to building traditional dhows and home to nesting wildlife that supply local communities with food. The loss of these forests is already causing irreparable harm. “We are selling Kenya cheap,” says Ali. “The president makes deals for his own benefit, and we are the ones who will suffer.”
Xi has called for China’s infrastructure initiative to be “green, healthy, intelligent, and peaceful.” In his speech at the Paris conference on climate change in 2015, he called for transfers of climate-friendly technologies to developing countries and urged international cooperation on climate change, but the guidelines for this, and whether they will be met, are unclear. Adding to the perplexity of China’s long-term game plan, a report released in March co-authored by Global Energy Monitor, Greenpeace, and the Sierra Club found that China is taking a “boom and bust” approach and is actually considering increasing the domestic cap for coal capacity to 1,300 gigawatts, which would add “between 300 and 500 new coal power plants by 2030,” according to Myllyvirta, one the report’s authors.
As the world turns away from coal, the question remains: Why is Kenya embracing it? With more than 51 million people, Kenya must meet energy demands, as every growing country does, but it doesn’t need to be through fossil fuels. Kenya has an opportunity to be a global leader in clean, renewable energy instead of becoming one more fossil fuel producer. It already boasts the largest wind power farm in Africa by number of turbines, Lake Turkana Wind Power Station.
Renewable sources account for 80 percent of Kenya’s energy supply, and access to electricity jumped from 28 percent in 2013 to more than 60 percent in 2017. Oxfam estimates that Kenya’s power demand over the next decade would be best met by investing in geothermal energy rather than a new coal plant. It would actually be cheaper.
Ironically, China’s own investments in hydroelectric, solar, and wind power have driven down the costs of renewable energy in the global market as fossil fuels become passé. It appears that as an era of coal ends in China, Beijing is simply looking to sell off overstock and shift labor needs abroad (it’s estimated that 2.3 million Chinese coal miners will be jobless by 2020) while strategically placing itself in a powerful position to drive Kenya’s market for energy and transport.
Adding to the gloom, General Electric and U.S. President Donald Trump’s administration, with its pro-coal agenda, seem to be taking cues from China. The year 2018 was not a good one for GE, which may explain the firm’s bullish gamble with coal: The company lost $90 billion in market value, its shares on Wall Street plunged more than 50 percent, and an open investigation by the Department of Justice lingers.
Turbines, such as those GE is selling to Kenya, are the company’s bread and butter. When former CEO Jeff Immelt stepped down in mid-2017, it seems he took with him GE’s support for the Paris agreement and the company’s climate policy, which “supports policies that promote both lower carbon emissions and sustainable economic growth.” In a letter sent to GE last summer, a group of 56 institutional and individual investors, representing nearly $713 billion in assets under management, demanded the company reconsider its decision to acquire a 20 percent stake in the Lamu coal plant, highlighting not only environmental and human rights concerns but Amu Power’s misleading cost savings for fossil fuels versus alternative renewable energy. GE did not respond to a request for comment.
“We are accusing GE of making a deal with Amu Power … without considering our concerns because they knew the local community’s position,” said Ali, the community activist. “The Americans, it seems, are like China and make deals without considering our constitution or our customary right. We condemn this. To us, America is a role model, so we are very, very disappointed by GE.”
A few weeks before GE signed on to the coal project, the High Court of Kenya ruled in the community’s favor, ordering millions in compensation to almost 5,000 fishermen in Lamu for the loss of their traditional fishing rights because of the construction of the port. Save Lamu filed a complaint against the coal project, alleging constitutional and potential human rights violations. Residents say they were removed from their land without compensation and that the community was not adequately consulted about increased electricity costs or environmental and social impacts of the project. A judge declined to hear the case.
As Kenya moves ahead with the coal plant, community activists say they have been increasingly targeted by the government after police raided Save Lamu’s office last year. The coalition has been accused of being a terrorist group linked to al-Shabab, and members have been intimidated, arrested, and detained for protesting—their constitutional right—though no charges were ever brought. Two activists have been missing since 2016 and one is presumed dead, as detailed in a Human Rights Watch report.
For community organizers, international attention has galvanized their cause. Four U.S. senators wrote a letter to the African Development Bank, asking it not to finance the project, though the deal is still being considered. Protests have been staged in Nairobi and as far away as San Francisco. The final decision may not come until it’s too late.
In 2010, Ustadh Mahmoud Abdulaqadir, an esteemed Lamu poet and imam affectionately known as “Mau,” wrote a poem describing a wave of changes crashing over Lamu: “It will wash away morals/We must be patient if we want better rewards.”
Asked if the poem felt prophetic, he sighs. “Yes, development is like a tsunami. Our culture will be further broken.”