Colombian imports

Germany's Blood Coal

Kolumbien befeuert Energiewende
Open-cast mines in Colombia's Cesar region have been a source of conflict. Source: dpa

It’s not often that the subject of murder is raised at a shareholder meeting.

So it’s fair to say that the comments made by Maina van der Zwan at the otherwise uneventful AGM of German energy company Uniper were unexpected.

Holding up a grainy picture of a Colombian man, the activist at Dutch NGO Pax announced: “He was the spokesman for a community which had opposed the expansion plans of a mining company in the Colombian region of Cesar. On September 11, he was murdered in cold blood.”

The shock tactics were clear: Uniper, along with fellow leading German energy suppliers RWE and EnBW, all import coal from Colombia.

Without foreign coal, the lights would go out in much of Germany. Almost 20 percent of the country’s electricity comes from burning so-called hard coal, the most energy-rich form. Some 90 percent of this is imported, with Colombia supplying almost a quarter of this.

“If we don't buy their coal, someone else will.”

Klaus Schäfer, CEO, Uniper

Coal mining in the South American country is big business, and local mining concerns are owned by global giants such as Anglo-American, BHP-Billiton, not to mention Goldman Sachs. With Germany’s hard coal mines set to close in 2019, the exporter will only become more important.

But hard coal imports from Colombia are not without problems. According to PAX, paramilitaries have displaced more than 55,000 people since 1996 and murdered more than 3,100 because of their opposition to open-cast mining in Cesar, which lies near the Venezuelan border. The mine operators claim to have no contact with these groups, but they directly benefit from forced relocations and destruction of homes.

“This coal is covered in blood,” said Mr. van der Zwan. “Anyone who opposes coal mining and the expulsion of human beings is threatened or murdered.”

Several European companies, including the Danish state-owned energy provider Dong and Italy’s Enel, have stopped importing coal from the region after carrying out investigations. But Uniper, the fossil fuel spinoff of utility E.ON, has no intention of pulling out of Colombia. “If we don’t buy their coal, someone else will. At least this way we can influence our suppliers,” said CEO Klaus Schäfer.

Neither Uniper nor RWE divulges which region in Colombia they get their coal from, but nor do they rule out Cesar as a source. RWE has called the situation in Cesar “concerning,” but, like Uniper, it justifies its refusal to stop doing business there by citing its work with local producers and commitment to a scheme called Bettercoal.

This initiative by European energy firms aims to promote better business and ethical practices among local suppliers, and provides a platform for dialogue with miners and NGOs such as PAX.

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Through Bettercoal, Uniper says it has established “standards for corporate responsibility, which are evaluated on the ground through audits.” The company says it reserves the “right to terminate contracts,” though it has noted that it doesn’t have any plans to do so.

Sebastian Rötters, from the German environmental group Urgewald, isn’t impressed. He said Bettercoal did little more than “analyze operating procedures” and send questionnaires to mine operators. “This is absolutely inadequate,” he added. Urgewald wants utility firms to become more active on the ground.

EnBW did just that, conducting an investigation in Cesar. It determined that a power vacuum had emerged in regions such as Cesar once the left-wing guerrilla group FARC, or Revolutionary Forces of Colombia, had withdrawn.

But it failed to spur the Karlsruhe-based company to action. “Setbacks always have to be reckoned with,” it concluded.

 

A shorter version of this article originally appeared in business magazine WirtschaftsWoche. To contact the author: online@wiwo.de

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