Contaminated Coal: Who doesn’t need it now?

Of all dirty fossil fuels in use today, coal is considered the dirtiest of them all. Yet, demand for coal is set to surpass oil as the key fuel for the global economy by 2020, driven by growth in China and India. This is despite government efforts to reduce carbon emissions across the globe. At the other end of the scale, coal power might soon become economically unfeasible in Australia, as costs for renewable energy drops and cost of coal-fired energy production increases due to carbon capture and storage. Read more

Coal will surpass oil as the key fuel for the global economy by 2020 despite government efforts to re duce carbon emissions

Economic growth in China and India are driving global demand for coal

Coal is plentiful and more affordable for both China and India

Coal demand in the U.S., Europe and rest of Asia will remain steady

By Helen Collis in Daily Mail (14 October 2013):

Coal will become more in demand than oil by 2020 driven by growth in China and India, despite campaigns to reduce carbon emissions across the globe, a new report reveals.

Marking a return to an era reminiscent of Britain’s industrial revolution, the rapidly expanding economies in the East are turning to coal since it is cheaper and more reliable than oil or renewable energy sources, energy consultancy firm Wood Mackenzie said on Monday.

Rising demand in China and India will push coal past oil as the two Asian powerhouses will need to rely on the comparatively cheaper fuel to power their economies. Coal demand in the United States, Europe and the rest of Asia will hold steady.

Little choice: China has no alternative to coal, with its domestic gas output limited, and liquefied natural gas (LNG) imports more costly than coal

Global coal consumption is expected to rise by 25 per cent by the end of the decade to 4,500 million tonnes of oil equivalent, overtaking oil at 4,400 million tonnes, according to Woodmac in a presentation on Monday at the World Energy Congress.

‘China’s demand for coal will almost single-handedly propel the growth of coal as the dominant global fuel,’ said William Durbin, president of global markets at Woodmac. ‘Unlike alternatives, it is plentiful and affordable.’

China – already the top consumer – will drive two-thirds of the growth in global coal use this decade. Half of China’s power generation capacity to be built between 2012 and 2020 will be coal-fired, said Woodmac.

China has no alternative to coal, with its domestic gas output limited, and liquefied natural gas (LNG) imports more costly than coal, Durbin said.

China’s demand for coal will almost single handedly propel it to the most demanded fuel on the planet, the report says

China’s demand for coal will almost single handedly propel it to the most demanded fuel on the planet, the report says

‘Renewables cannot provide base load power. This leaves coal as the primary energy source,’ he said.

Power infrastructure provider Alstom estimated that across Asia close to half of the 600 gigawatt of new power generators to be built over the next five years will be coal-fired, Giles Dickson, a vice president at the company said.

‘Coal prices are low,’ he said, adding that coal is about one-third of the price of LNG in Asia and about half of the gas price in Europe.

Abundant supply is also supporting demand for coal. The traded volumes of coal will increase by a further 20 per cent by 2020, Dickson said, including supply of lower grade coal from Indonesia, Australia and South Africa.

‘As the lower grade coal comes into the market, further downward pressure on prices will further drive demand,’ he said.

Currently, oil is the most used fuel the world over, but coal is expected to be more in demand by 2020 Currently, oil is the most used fuel the world over, but coal is expected to be more in demand by 2020

Excess supply and faltering demand growth have depressed global coal prices this year. European coal futures have tumbled more than 20 per cent, while Australian coal prices have plummeted from the record $130 per tonne hit in 2011 to around $80 per tonne as China’s demand grew slower than expected.

‘If you take China and India out of the equation, what is more surprising is that under current regulations, coal demand in the rest of the world will remain at current levels,’ Durbin said.

High fuel import costs and nuclear issues will support coal use throughout Northeast Asia, while in North America coal is still competitive in many locations despite abundant low-cost shale gas.

‘The struggling economy and low coal prices has rendered the European Union (EU) Emissions Trading Scheme (ETS) ineffective,’ Durbin said. ‘The carbon price will need to reach 40 euros per tonne to encourage fuel switching, which is unlikely before 2020.’

In Southeast Asia, coal will be the biggest winner in the region’s energy mix. Coal will generate nearly half of Southeast Asia’s electricity by 2035, up from less than a third now, the International Energy Agency said in early October.

This will contribute to a doubling of the region’s energy-related carbon dioxide emissions to 2.3 gigatonnes by 2035, according to the IEA.

Source: www.dailymail.co.uk

Even under a conservative government, coal-fired electricity has no future

Mark Diesendorf in The Conversation (10 September 2013):

Coal-fired electricity may have little or no economic future in Australia, a new analysis has found. While the new government seems determined to turn its back on renewable energy, our study shows that even without a carbon price, and even with the assumption that carbon capture and storage will eventually become commercially available, coal may not be able to compete with renewable electricity.

Carbon capture and storage captures CO2 emitted by fossil-fuelled power stations, compressing and transporting it by pipeline, and burying it in repositories deep underground. We modelled a range of fossil fuel scenarios with CCS, and then compared their economics with that of our previously published 100% renewable electricity scenario based on commercially available wind, solar and biomass technologies.

The team, from the University of NSW, comprises Ben Elliston, a PhD candidate in the School of Electrical Engineering and Telecommunications, and his supervisors – Associate Professor Iain MacGill, of the Centre for Energy and Environmental Markets, and myself.

Using hourly electricity demand and solar and wind data from 2010, we determined the appropriate technology mixes for each scenario. Scenarios had to balance electricity demand and supply to achieve the same reliability as the existing Australian National Electricity Market.

We used government estimates of the prices for different generation technologies and fuels in 2030. We also looked at a wide range of possible future carbon prices and carbon capture and storage prices.

The results show that coal with carbon capture and storage (CCS) scenarios are likely to struggle to compete economically with 100% renewable electricity in a climate-constrained world, even if CCS is commercialised by 2030.

CCS might become economically competitive in a few rare circumstances – such as for power stations located near potential CO2 repositories in southern Victoria at a time when there the carbon price is low.

But the majority of Australia’s coal-fired power stations are in New South Wales and Queensland, a long way from storage sites. These would have great difficulty in competing economically with 100% renewable electricity.

Even in the unlikely event that the carbon price were to be zero in 2030, electricity generated from coal with CCS would at best be equal in cost to the 100% renewable energy scenario, assuming an average transportation distance for the CO2. However, if there were no carbon price, there would be no incentive for bringing CCS to commercial maturity in the first place.

Because the onward march of global climate change cannot be slowed by the election of a Coalition government in Australia, it seems likely that by 2030 the climate situation would be desperate and most countries, including Australia and the USA, will have a high carbon price.

In summary, the UNSW modelling suggests that, in a future climate-constrained Australia, there would be little role for a domestic coal-fired electricity industry, with or without CCS.

We also compared gas-fired power stations using CCS against 100% renewable electricity. While this gas generation scenario could potentially be competitive at current gas prices, the study showed this would not be the case if domestic gas prices reached export parity. Currently gas prices are increasing substantially as more and more gas from eastern Australia is exported.

How can we understand these results when only a few years ago many governments and fossil-fuel industries were claiming that carbon capture and storage technology would be one of the best options for mitigating emissions from electricity generation?

In practice CCS technology has turned out to be more complicated and expensive than initially appreciated. While some small pilot plants have been built, large-scale CCS systems for electricity generation still haven’t been demonstrated. They appear to be years – likely decades – from possible commercial deployment.

Meanwhile, renewable energy technologies have been advancing rapidly, both within the Australian electricity industry, and globally.

The research confirms that policies to pursue very high penetrations of renewable electricity, based on commercially available technologies, offer a reliable, affordable and low risk way to dramatically cut emissions in the electricity sector. There is no need to invest in new, expensive, unproven, high-risk, fossil fuel technologies.

What does the change of federal government mean for Australia’s renewable energy future? The Coalition’s policies include:

• removing the modest carbon price, which anyway would have become very small post-July 2014 if Labor had been returned to government;
• holding yet another enquiry (the twentieth!) into wind farms, presumably to give more air to the unsubstantiated claims of a wind turbine syndrome
• terminating the Clean Energy Finance Corporation. This provides venture capital to help the transition of some renewable energy technologies from the demonstration stage to the early diffusion stage of technological maturity
• holding yet another enquiry into the Renewable Energy Target, thus undermining investors’ confidence
• cutting funding to the Australian Renewable Energy Agency, which provides research and development grants.

It is difficult to avoid the interpretation that these five polices taken together amount to a deliberate strategy to undermine the further dissemination of renewable energy in Australia. However, while this strategy will slow down investment and associated job creation, especially for wind farms and large-scale solar power stations, it cannot stop it.

The price of solar photovoltaic modules continues to decline and the market continues to expand. Contrary to the claims of the deniers of climate science, global climate change is continuing and its impacts will become more and more serious.

The growing social movement for renewable energy has already successfully opposed three Australian state governments that attempted to penalise households with solar electricity.

Soon people power will give the Australian and US federal governments no choice but to take rapid, effective climate action, whichever party is in power.

Associate Professor and Deputy Director, Institute of Environmental Studies, UNSW at University of New South Wales, Mark Diesendorf receives no funding from the renewable energy industry. He does occasionally receive government-funded research grants on renewable energy and energy policy.

The Conversation is funded by CSIRO, Melbourne, Monash, RMIT, UTS, UWA, ACU, Canberra, CDU, Curtin, Deakin, Flinders, Griffith, JCU, La Trobe, Massey, Murdoch, Newcastle, QUT, Swinburne, UniSA, USC, USQ, UTAS, UWS and VU.

Source: www.theconversation.com