Amsterdam, Rotterdam and Antwerp, the bastions of global seaborne coal trade, are readying themselves for Europe’s energy transition
The Dutch power sector’s retreat from coal, alongside closures in Germany and neighbouring countries, is unfolding sooner than expected, holding out the prospect of major change for Europe’s leading bulk terminals in the Netherlands and Belgium.
In March, the Dutch government announced the closure in 2020, four years earlier than expected, of the Hemweg-8 plant in Amsterdam, owned by Sweden’s Vattenfall, which is one of five remaining coal-fired units in the Netherlands.
The axing of the 630 MW facility, which had been inked for retirement by the end of 2024, follows a Dutch court ruling last year that greenhouse gas emissions must be slashed to at least 25% of 1990 levels by the end of 2020.
With the Dutch government looking to find ways to reach these emissions targets, pressure is mounting to bring forward the closure of the country’s oldest coal-fired power plant, RWE’s 643 MW Amer 9 in Geertruidenberg, before 2025. The three other Dutch coal-fired power stations are due to shut by 2030.
The Netherlands now has capacity of 4.6 GW of hard coal power, according to the European Network of Transmission System Operators for Electricity.
Vattenfall labelled the Dutch government’s amended bill a “heavy measure in the very short term”, having invested to enable the plant to operate until the end of 2024. The Swedish group is in talks with the Dutch government over compensation.
OBA Bulk Terminal Amsterdam, which handles coal for nearby Hemweg, is also set to feel the impact of the closure. Coal unloaded at OBA is conveyed to flat open storage, where a front-end loader lifts it onto a 1,000 tph conveyor to the plant.
However, OBA, a joint venture between European dry bulk terminal operator HES International and US coal group Oxbow Carbon, has been investing in infrastructure to diversify as a multipurpose port.
In March, a new 33,000 m3 capacity warehouse opened for the storage of a variety of dry bulk products, expanding OBA’s storage capacity to 181,000 m3. Served by gantry ship-unloaders, the new warehouse has 11 remote controlled roof hatches.
Last year, OBA and the Port of Amsterdam signed a Letter of Intent acknowledging the pressures of energy transition and the need to diversify, identifying 20% of its coal handling site for redevelopment to handle other bulk commodities.
With rising demand for covered storage for products such as animal feed, minerals, construction materials and biomass, OBA managing director Harm Winkeler says Amsterdam is well-positioned to adapt to the supply chain needs of other industries in the Netherlands and Germany.
The strategy to turn more of the OBA terminal area over to bulk products other than coal follows the announcement two years ago by the port authority that the handling and transhipment of coal in Amsterdam would cease by 2030.
In the meantime, long-term coal volumes delivered by barge along the Rhine from Amsterdam, as well as Rotterdam and Antwerp, are declining as the renewables share of the power mix rises, while stockpiles grow at southern German plants.
In March, coal-fired power generation in Germany reached its lowest level since 2010 – a daily average of 4.8 GW – while wind power and renewable energy generation are at an all-time high, according to Germany’s Fraunhofer Institute for Solar Energy Systems.
In January, Germany’s coal commission also published its phase-out proposal to end the country’s use of coal power by 2038, or by 2035 under the right conditions, with 12.5 GW closed by 2022 (one third of 2017 capacity).
In April, French utility Engie said it would offload its last coal units in Europe, including its 2015-built, 731 MW plant in Rotterdam, as well as German assets Farge, Zolling and Wilhelmshaven, to Goldman Sachsbacked Riverstone Holdings.
France is among the 15 countries of the Powering Past Coal Alliance committed to phasing out coal power by 2030. Luxembourg is also a signatory. In 2016, Belgium became the first former coalburning EU members to have entirely coal-free power generation.
The gathering pace of this phase-out, the consequent fall in demand for coal transhipment, and the endgame of the region’s thermal coal trade are focusing minds among bulk terminal operators in the Benelux, as well as across Europe.
HES’s Rotterdam Bulk Terminal (RBT) in Vlaardingen is another casualty of the decline of coal, closing in February. HES took full control of RBT in April last year after buying out Dutch group Maja Stuwadoors Groep’s 50% stake in the joint venture.
In 2018, HES and Maja deemed the continuation of services at RBT and the investment needed to modernise the site uneconomic, with expansion restricted by the site’s limited capacity and draught alongside, as well as its proximity to the city of Vlaardingen.
Instead, HES has invested in expanding covered storage capacity to 650,000 m3 at European Bulk Services (EBS), which has buttressed its multipurpose capacity in Rotterdam. This, says HES, has enabled a smooth transfer of transhipment clients.
With the changes afoot in the Dutch and German energy markets over the next decade, HES is phasing out coal storage at EBS and in future will focus its activity at the site on handling agricultural
products and biomass.
The decline in thermal coal, broader shifts in global markets and a sluggish eurozone are rippling through the bulk trades. Although Rotterdam’s bulk handling rose 3.7% to 19.45 Mt in the first quarter of 2019, iron ore and scrap handling fell 17.9% to 5.9 Mt.
In 2018, with the dry bulk market under pressure and continued economic uncertainty in Europe, bulk throughput of these cargoes in Rotterdam fell 3% from 80.2 Mt to 78.6 Mt, after a 22.6% decline the previous year.
Coal handling rose 2.3% to 26.4 Mt in 2018, as port consolidation attracted coke cargoes for Germany’s steelmakers, following a slight decline in 2017, while thermal coal volumes were static. Iron ore throughput fell in 2018, due to furnace renovations and stagnant demand from steelmakers, while ore and scrap volumes fell 3.6% to 30.1 Mt.
Rotterdam has had to absorb the German steelmaking slump, with 5% less produced in the first quarter of 2019 than a year earlier. Germany has faced falling global demand, a weakened domestic economy and the impact of Chinese steel exports.
Low coal prices in Europe prompted traders in the first quarter to capitalise on the opportunity with increased purchasing and stockpiling activity. Coal handled at Rotterdam increased 15.7% to 7.5 Mt over the first three months of the year.
Last year, the volume of thermal coal for power generation remained static via Rotterdam, after falling by 9.5% in 2017 as eight coalfired plants closed – two in the Netherlands and six in Germany –and other stations across Europe generated less coal-fired power. Demand for coking coal also declined slightly.
But agribulk at Rotterdam fell 11.6% to 9.9 Mt in 2018 (after growing by 6.6% in 2017), as Amsterdam won cargo from its rival. Biomass was up by a third (32%) to 545,000t amid growing demand in Europe, which built on increased throughput of biomass to Belgium and the 414,000t of the specialist cargo handled in 2017.
New bulk cargoes are central to the Port of Rotterdam Authority’s investment strategy as it adjusts the energy transition from coal. Rotterdam led on a report released last July, part of a draft National Climate Agreement, on how to achieve a sustainable industry cluster, looking at coal, biomass and agribulks in energy and chemical production.
Rotterdam also continues to expand its transhipment facilities as it diversifies its bulk cargoes. In April, EBS completed its Warehouse 6 at the Laurenshaven terminal for storing high-quality minerals and biomass (see box story, p7).
In 2017, HES-owned Europees Massagoed Overslagbedrijf (EMO) replaced its 1970s conveyor belt system in the west of the port with eight new lines connecting its stackers/reclaimers, barge/train loaders and blending silos that serve the European iron ore and coking coal market.
Belgium’s main dry bulk cargo terminals in Antwerp are also experiencing the fluctuating nature of the global economy and Europe’s energy transition, with the port reporting an 8.8% decline in volumes in the first quarter.
The slump in dry bulk handling was the result of falling volumes of iron ore (-22.9%), coal (-16.5%), scrap (-10.2%) and fertilisers (-2.2%), although in March, the latter achieved its highest monthly throughput since February 2011.
Jacques Vandermeiren, CEO of the port of Antwerp, emphasised that the dry bulk trades are traditionally characterised by high volatility. In 2018, the port’s dry bulk throughput was up 7.2% to 13.1 Mt, although this was 52% down from the 27.4 Mt handled in 2008.
The long-term decline in dry bulk cargo largely reflects the retreat from coal in Europe’s power sector, the decline in demand for seaborne imports of overseas supplies, and the strategy of energy transition away from fossil fuels.
Last year, Antwerp saw a spike in coal handling, however, up 11% to 1 Mt, equalling 2016 volumes and redressing a slump to 477,515t in 2017. Antwerp benefitted from a rerouting of maritime coal traffic bound for Germany due to extremely low water levels on the River Rhine in the summer and autumn of 2018.
However, Belgium’s largest port imported just 186,000t of coal in the first quarter this year, amid a decline in demand and competition with other terminals. Since 2010, ores handled by Antwerp have declined by more than a quarter (27%) to 2.1 Mt in 2018, with a 14% drop last year from 2.4 Mt in 2017. In 2008, ore throughput was 7.5 Mt.
However, there has been an increase for Antwerp in other bulk cargoes in recent years. Fertiliser throughput has grown steadily, and is up by 12% since 2014 to 4.2 Mt in 2018, while sand and gravel handled was up by 18% yearon-year in 2018 to 1.2 Mt. Iron and steel products rose by a third between 2010 and 2018 to 8.7 Mt