Gov’t failing to prevent abuses linked to ESB coal imports, charity warns

Published by Niall Sargent on

February 20th, 2020

Christian Aid Ireland has accused the ESB of complicity in human rights abuses in Colombia by importing coal from the controversial Cerrejón mine for use at its Moneypoint power station.

In a new report launched today, the charity also points to Ireland’s taxation system as facilitating the mine owners to potentially avoid tens of millions of euros in tax every year by using a Dublin-based company to handle global sales of its product.

The massive mine complex covers more than 700km2, impacting over 300,000 people across a 200-kilometer stretch of the impoverished state of La Guajira, home to a large indigenous population. ESB coal import figures released to The Green News first revealed the extent of the semi-state’s reliance on the mine for its coal imports.

The data, released after several Access to Information on the Environmental (AIE) requests, shows that two-thirds of the 12.5 million tonnes of coal imported between January 2011 and March 2018 came from Cerrejón. In a statement, the ESB said that it has received no coal from Cerrejón since 2018.

The Christian Aid report follows the recent call from the UN Committee on the Elimination of Racial Discrimination for the Government to consider halting coal purchases from Cerrejón over human rights concerns.

Environmental and health issues

The Christian Aid report details a range of the health and environmental issues linked to mining activities, including air and soil pollution caused by coal and coal dust.

People living close to Cerrejón massive open-cast pits are known to experience higher than normal cases of skin disorders, respiratory and cardiovascular illnesses, as well as hypertension and pregnancy complications, the report states.

In 2015, a Colombia circuit court ordered the mine to reduce its particulate emissions after hearing the case of three-year-old Moisés Guete Uriana from an indigenous Wayúu reserve beside the mine who suffers from severe respiratory problems. According to the report, to date, there has been no meaningful effort to comply with the order.

The mine also impacts on the availability of water, an already scarce resource in the drought-ridden region, using 16 million litres of water a day from the Ranchería River – enough supply for 67,000 people.

Cerrejón has also made structural interventions in 19 rivers and streams, aggravating water scarcity issues for locals and causing environmental and health problem by putting contaminated water back into the Ranchería.

Elevated levels of heavy metals including lead, cadmium and barium that are linked to higher levels of cancer, renal and liver problems have been found in the river.

A decade-long study by Colombian and Brazilian universities and Sintracarbón, a union representing Cerrejón workers, found that mine pollution was likely driving elevated levels of cellular damage among employees and those living close to the mine, raising the risk of cancer and DNA damage.

The report also outlines how the mine has been responsible for the forced displacement of dozens of communities as well as highlighting issues with intimidation of union leaders and activists over a number of years by paramilitary groups in the region.

In previous statements to The Green News, Cerrejón has repeatedly stated that the mining company is committed to conducting its operation in line with national law and international standards to prevent and mitigate impacts of its operations. The company has said that it is committed to the respect of human rights and “have been [on] a journey to implement standards” aligned with the UN principles on business and human rights.

Irish tax regime aiding Cerrejon

The report also claims that Ireland’s low 12.5 per cent corporate tax rate has facilitated the owners of the Cerrejón mine to potentially avoid millions in tax by using a Dublin-based company to handle global sales of its product. The corporation tax in Colombia by comparison is 34 per cent.

Since it was set up in 2013, the Coal Marketing Company has coordinated the sale and delivery of over 450 million tonnes of Cerrejón coal. All sales, service and technical support all managed from the company’s office on Fumbally Lane in the Liberties.

Last year, the Irish Examiner reported that CMC made an after-tax profit of €62.5m on €2.3bn in revenues in 2017, paying just €9.2m in taxes. If the company was based in Colombia, it would have paid close to €25 million.

“This is a loss of revenue to the Colombian government that might otherwise have been deployed to protect the human rights of marginalised communities, including the people of La Guajira,” the Christian Aid report states.

In a foreword to the report, the UN Special Rapporteur on Extreme Poverty and Human Rights Philip Alston said that Ireland has “carved out a very particular niche for itself” through its fiscal policies that “often accused of encouraging a race to the bottom in order to attract a wide array of corporate interests to its shores”.

“The circumstances under which companies based in Ireland conduct their business should be of grave concern for the Irish Government. It is strongly in Ireland’s interests, as well as its perception of itself as a human rights respecting state, that it takes seriously its obligations to ensure these businesses meet their human rights responsibilities,” he added.

Activists outside the offices of the Coal Marketing Company, Fumbally Lane, Dublin Photo: LASC
Activists outside the offices of the Coal Marketing Company, Fumbally Lane, Dublin Photo: LASC

National Plan on Business and Human Rights

Christian Aid said that its findings point to the failure of the Government’s National Plan on Business and Human Rights to prevent state-owned and Irish-based companies from undermining the human rights of workers or communities where they work.

The charity wants to see the plan updated to demand that Irish-based companies do not harm developing countries through their environmental record or tax behaviour.

Christian Aid also wants to see new stringent laws put in place to compel state-owned and Irish-based companies to check for any human rights abuses in their operations and along their supply chains.

“Without clear legislation that holds the Irish government and the ESB to account, the National Plan will remain a smokescreen for genuine respect for human rights in business operations,” the report states.

Christian Aid wants the ESB to support an independent human rights and environmental impact assessment, the terms of which are supported by affected communities.

It also wants the semi-state to push Cerrejón to ensure respect for human rights and for the ESB to develop its own “robust public human rights policy” that involves the monitoring of its supply chains.

Christian Aid made several requests for a direct dialogue with the ESB on its findings but no representative was made available for interview ahead of the publication of the report.

Moneypoint Power Station - nocturne in blue and gold
Moneypoint Power Station Photo: Tiger

Bettercoal assessment

Both Cerrejón and the ESB have continually referred media towards a recent assessment by Bettercoal – an international alliance of major coal buyers – that found the mine’s operating principles are in line with best practice.

As part of its commitment to responsible sourcing, ESB today said that its active membership of Bettercoal “provides the best platform to achieve continuous improvement in the mining industry”.

A public version of the Bettercoal assessment released in January 2019 has been criticised by academics and human rights groups who argue there was little consultation with local stakeholders and a lack of disclosure about the criteria for site assessments.

The ESB has said that it is also aware of problems linked to the mine and “Colombia’s difficult history” that have been reported in the media and other organisations.

“We are committed to remaining vigilant on all of these issues we will continue to engage with Bettercoal to exert influence and drive improvements.  We bring such issues to Bettercoal for their assessment as a matter of course,” the semi-state said.

Internal emails released to The Green News through AIE requests, however, reveal that staff within the fuel trading section of the company appear more concerned with the company’s image in light of accusations against the mine.

In an email from October 2018 to the Bettercoal team, a member of ESB’s fuel trading team requested an update as to when its assessment would be finalised following increased media scrutiny of coal imports from Colombia.

A Bettercoal staff member informed the ESB that the report would be finalised “asap” but that the staff member could “have a sneak peak [sic]” at the report if the fuel trading team let them know of any specific issues of concern. “Just looking for any bombshell issues. Issues that show the company in bad light,” the ESB staff member replied.

Clodagh Daly of the Stop Blood Coal campaign group told The Green News that the ESB emails make it clear that the semi-state does “not care about the human cost of burning coal” and only appears concerned with “protecting its own image”.

“The ESB has previously cited Bettercoal as testimony to the responsible management of their supply chain. This response, however, proves that Bettercoal is nothing more than a slick PR tool designed to allow utility companies to abdicate responsibility for the damages inflicted upon communities as a result of coal extraction,” she added.

In addition, an email send to Bettercoal on 4 January 2019 from the fuel trading team appears to doubt the veracity of Irish media reporting of alleged links between Cerrejón and human rights issues. “We are seeing repeated articles in the media all saying the same thing,” the email states.

“There is talk of evictions, intimidation, and environmental destruction in all the articles but there is never anything specific or new in it and it is always referred to in a very general manner, high level manner,” the ESB email continues.

Ms Daly said that if concerns of evictions, intimidation and environmental destruction “seem too general” for the ESB, then the company should have taken the time to meet with Jakeline Romero Epiayu, a Wayúu indigenous woman and human rights activists from La Guajira, who was recently in Ireland.  Ms Daly said that the ESB was invited to a private meeting with Ms Romero Epiayu to hear her story but did not respond to the request.

The ESB said that senior managers have visited the Cerrejón site on a number of occasions and met directly with workers, community leaders and trade union officials. A senior manager is scheduled to visit once again next month, the semi-state said.

Clodagh Daly speaking at talk on Irish coal imports Photo: Niall Sargent
Clodagh Daly speaking at talk on Irish coal imports Photo: Niall Sargent

Coal use dramatically reduced

ESB’s overall coal imports fell dramatically in 2019, according to reports in the Sunday Business Post this week, down to just 72,000 tonnes from the 1.06 million tonnes imported in 2018 as coal use for electricity generation continues to drop.

This fall in imports is reflected in a major decline in output from the plant that until very recently was Ireland’s largest power generator, producing around 4,500 GWh of electricity generation per year. This compares to just over 2,000 GWh in 2018 and 590 GWh in 2019. As reported in The Independent this morning, the plant has not produced any electricity for the past seven weeks.

A spokesperson for the ESB told The Green News that output at Moneypoint has “declined dramatically” over recent years as renewable electricity has increasingly replaced coal-fired electricity.

However, as revealed by The Green News, a portion of the decline in coal use in recent years is also down to technical issues with turbines at the plant that halted production for several months in 2018 and 2019. In addition, coal use has declined due to a combination of international market pressures and increasing carbon prices.

The ESB will phase out burning coal for electricity generation within five years and is examining technology options beyond 2025 that can “deliver large scale electricity generation, fuel diversity and security of supply”.

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Niall Sargent

Niall is the Editor of The Green News. He is a multimedia journalist, with an MA in Investigative Journalism from City University, London