From thick smog blanketing the cities, to acid rain corroding soils and ruining crops, air pollution from China’s coal industry is inflicting heavy damage on the country’s environment, its economy, and its citizens’ health. But these clouds of smoke have obscured the less visible (but no less severe) water challenges facing the coal sector and the region it operates in.
Chinese coal businesses, mainly located in the country’s arid north, are depleting scarce water resources and degrading the quality of the water. Despite increasing water shortages and stricter regulations around water pollution and conservation, the coal industry—including coal mining, coal-fired power, and coal conversion companies—lacks sufficient water conservation programs and wastewater management practices. Weak enforcement and lack of transparency on coal’s water use and discharge are undermining northern China’s water security. This poor water management not only threatens regional health and sustainability, but also puts coal companies at risk in the long run.
The Institute of Public & Environmental Affairs (IPE), China’s leading pollution transparency NGO, developed the Corporate Water Risk Assessment Tool to evaluate the water management plans of 30 top-earning Chinese coal companies. The evaluation seeks to help publicly listed coal companies, investors, and regulators better understand the coal industry’s water risks and encourage them to reduce water insecurity in ecologically fragile areas of China.