The 100 global power companies most at risk from growing pressure to shut highly polluting coal plants have been revealed in a new report from Oxford University.



Chinese companies dominate the top of the ranking but US companies, including Warren Buffett’s Berkshire Hathaway, occupy 10 of the top 25 places.

The analysis, produced to help investors assess the risk of major financial losses, also found French energy giant GDF Suez was third in the list of most polluting coal station fleets in the world.

Coal currently provides 40% of the world’s electricity and three-quarters of this is produced by the most-polluting, least-efficient and oldest “sub-critical” coal-fired power stations. The International Energy Agency calculates that one in four of these sub-critical plants must close within five years, if the world’s governments are to keep their pledge to limit global warming to 2C.

The new analysis ranked the companies by how much electricity they produced from sub-critical plants. The major German utilities RWE and E.ON both appeared in the top 25, along with South Africa’s Eskom and Australia’s AGL Energy.



“Sub-critical coal-fired power stations are the first thing we need to kill off if we want to tackle climate change,” said Ben Caldecott, the report’s lead author and director of the Stranded Assets Programme at Oxford University. As well as carbon emissions, the air pollution and pressure on water resources caused by these coal plants were also analysed.

Caldecott said some Chinese coal plants were already being closed due to public anger over air pollution, while others in India have been unable to operate for months at a time due to a lack of water. However, subcritical coal-fired power stations continue to be built, despite producing 75% more carbon pollution and using 67% more water as the most efficient - but more costly - plants.

In the US, new regulations on carbon emissions could see coal companies lose $28bn (£19bn) in value, according to one recent analysis. The US companies in the top 25 of the Oxford ranking have 109 sub-critical stations between them. “These are assets that could become stranded because of environmental restrictions,” said Caldecott.

Major financial institutions, including the Bank of England, World Bank, Citi, Goldman Sachs and HSBC, have warned that action to tackle climate change may harm investments in fossil fuels. A series of analyses have shown that most existing reserves of fossil fuels cannot be burned without blowing the safe budget for carbon emissions and a study in January indicated that 80% of known coal reserves would have to stay in the ground.

Zoe Knight, head of HSBC’s Climate Change Centre of Excellence, said: “The [ Oxford] research will help investors to understand the material environmental risks associated with sub-critical coal, as well as levels of company exposure to them.”

“It is obvious that many sub-critical coal plants will have to shut down if we are to get close to staying within our carbon budget,” said James Leaton, director of research at the Carbon Tracker Initiative. “This will have a major effect on demand for coal going forward, as evidenced by Chinese demand for thermal coal peaking in 2014.”

However, Benjamin Sporton, acting chief executive of the World Coal Association (WCA), said: “Coal use is set to grow by around 17% in the next 20 years [because] it is affordable, reliable and abundantly available.”

Sporton said the WCA was promoting the adoption of high efficiency, low emissions coal technologies: “The objective is to raise the global average efficiency of coal-fired power plants and so minimise CO2 emissions, whilst maintaining legitimate economic development and poverty alleviation efforts.”

He said increasing the efficiency of the global coal fleet from 33% today to 40% could be done with current technology and would save about 2bn tonnes per year, roughly equivalent to India’s total annual emissions.

A spokesman for GDF Suez did not address why its 10 sub-critical coal plants had higher pollution levels than any other company, except for two small companies in India. He said the company was “conscious of its responsibility and of its major role in the energy transition [and] has set ambitious environmental objectives”, including reducing its own CO2 emissions by 10% by 2020.