A WORLDWIDE rebound in coal trading is disrupting efforts to mitigate global warming and prevent climate change.
Energy analysts expect coal consumption in Southeast Asia and India to grow, as demand for the cheapest fuel is driving rapid economic expansion and offering big profits to investors in the electricity sector.
Environmentalists across the world are watching this rebound in the coal industry with great concern because it runs counter to international efforts to reduce reliance on fossil fuels by 2050 in order to stem the rise in global temperatures.
“Coal is the most carbon-intensive fossil fuel and phasing it out is a key step in achieving the emissions reductions needed to limit global warming to 1.5 degrees Celsius,” said Paola Yanguas Parra, policy analyst at Climate Analytics.
Parra insisted that, in order to achieve the carbon-emission reduction milestone of the Paris Agreement, Climate Analytics research suggested that every country must stop burning coal by mid-century, so efforts to get rid of coal must start now.
The Global Coal Exit List, which was released at the UN Climate Summit in Bonn, Germany, last year, revealed that more than 770 companies were still actively engaged in coal-related business, that 225 firms were planning to expand coal mining and that 282 were planning new coal-fired power stations.
This revival in the coal industry has also been mentioned in leading energy-monitoring reports since 2017. The International Energy Agency (IEA) reported that coal production last year had risen by 3.1 per cent, while coal consumption in the energy sector had also increased, by 1 per cent.
According to the IEA’s 2018 coal overview, higher production has been noticed in all major coal-producing countries except Germany and Poland, while global trade in coal in 2017 rose by 3.3 per cent from the year earlier.
The IEA said the growth in the coal industry could be blamed on the policy reversal in the United States and greater demand for coal in China and India. These largest coal consumers have both increased their demand for cheap fuel to produce power.
“Coal will still be our primary source of energy for the upcoming decades, despite renewable energy becoming the biggest competitor due to its rapid growth and cheaper cost. But I believe coal still plays an important role in ensuring the stability of the energy sector,” said Sacha Parneix, GE Power’s commercial general manager.
“There is no doubt that coal has a bad reputation for being a major pollutant and it is true that the improper use of coal will have serious environmental impacts, but right now we have more advanced technologies to mitigate these limitations and allow us to safely use coal.”
Improved efficiency with new technology
Parneix pointed out that GE’s ultra-supercritical combustion technology allows more electricity to be generated using smaller amounts of coal.
Higher profits is another reason encouraging the continued use of coal, since it is the cheapest fuel option for power generation and can boast the highest profits from sales of power, Malaysia’s Tenaga Nasional Berhad Janamanjung managing director Shamsul Ahmad said.
He said he believes coal will remain a major fuel for electricity generation in Southeast Asia mainly because the region is geographically close to major coal exporters such as Australia and Indonesia. Shamsul has 30 years’ experience in the energy industry and has spent many years at the largest coal-fired power plant in Southeast Asia – the 4,180MW Manjung facility in Perak.
“Coal will remain a cheap source of energy for many decades because the world still has plenty of coal reserves left. Also, our society is driven by profit,” he said.
IEA analysts said they expect the consumption of coal in Southeast Asia and India to rise over the next four years because this region is the last resort for the coal industry and will hold a 35-per-cent share in coal consumption by 2022.
However, independent energy expert Prasart Meetam said this rebound in the industry will be temporary, pointing out that the era of coal will eventually end due to the rapid technological advancement of renewable energy and humanity’s effort to prevent global devastation from climate change.
Prasart dismissed beliefs that coal is the cheapest fuel option and that we need coal to provide base-load electricity, saying the cost of renewable energy is going to increasingly plummet in the years to come. Also, he said, the trend of electricity generation is shifting from large power stations to smaller, localised and diversified renewable-power generation.
“With our current technologies, I am certain we can entirely replace coal in 10 to 15 years and we need to act fast or we will fail to contain the rise of carbon dioxide and trigger the irreversible hothouse Earth,” he stressed.