Sunday, January 16

The COP Aims To End Coal, But The World Is Still Addicted

Never in the history of mankind has a ton of coal cost more. Governments and utilities around the world are willing to pay record sums to literally keep the lights on. That’s the painful reality world leaders must face in the high-stakes climate talks in Glasgow this month, as hopes for a deal to end the world’s dependence on the dirtiest fuel fade.

Burning coal represents the biggest obstacle to meeting the Paris Agreement goal of limiting warming to 1.5 ° C. UN Secretary General Antonio Guterres calls it a “deadly addiction,” and the president of the COP26, Alok Sharma, has urged the leaders to “give the coal to history”.

There has already been some progress: The global portfolio of new coal-fired power plants has shrunk by almost 70% since 2015. President Xi Jinping announced last month that China will stop building coal-fired power plants abroad, while Germany now it wants to end its use of coal by the end of this decade and more than 40 countries have pledged to “have no new coal.” Renewable energy is expanding dramatically.

But the dramatic rally in prices in recent weeks shows more and more clearly that it is not close enough. Humanity remains deeply dependent on coal.

On the one hand, coal continues to dominate the world’s total electricity generation mix by a wide margin. More new coal plants are still being built than old ones that are being shut down, and the International Energy Agency projects that emissions from the power sector will hit a record high in 2022 as the use of coal power increases.

To meet the 1.5 ° C target, emissions from coal must be reduced in this decade roughly twice as fast as pollution from oil and gas, according to Carbon Brief’s analysis of global emissions scenarios. For example, in one of dozens of possible ways to achieve the goal, carbon emissions should decrease by 79% from 2019 to 2030.

That’s a gigantic challenge, all the more daunting given this year’s growing appetite for coal to generate electricity. The global energy crisis and natural gas shortages have boosted demand for coal, causing prices to skyrocket to records in nominal terms and reducing supplies.

And while production has been restricted as the largest mining companies pull out of coal under pressure from investors, high prices are likely to attract private and smaller players who do not face the same restrictions, which means that there is more coal available to burn.

Like almost every other aspect of world economic history, the demand for coal in the past three decades has been a story about the rise of China. As the global manufacturing base moved east, so did the demand for the cheap, easy-to-build energy needed to power everything from steel plants to cities.

Since 1990, America’s demand for coal has been cut in half, in large part because power companies have switched to gas. European demand has fallen by almost two-thirds. However, these advances have been easily offset by China’s growth. Its consumption was roughly on par with that of the US when the Cold War ended, but now stands at an impressive 87,638 terajoules, more than half of total global demand.

It is not just China. India now burns more coal than Europe and the US Together and miners are betting on growing demand over the next decade from countries like Vietnam, Bangladesh and Indonesia, though concerns about pollution and cheaper alternatives threaten to derail those. plans.

Nothing highlights the migration of coal from west to east better than where power plants are being removed and built. For decades, plants have been shutting down across Europe, wiped out by a potent combination of climate policy pressure, falling costs for renewables, and a flood of cheap gas.

The UK, the original example of the coal-fueled Industrial Revolution, spent 67 consecutive days without burning fuel last year. Only Spain closed seven of its 15 coal plants in 2020. In total, half of the region’s coal plants have closed or will close in 2030.

This year, the energy crisis in Europe has exposed the vulnerabilities of the system. The UK has been particularly hard hit after calm weather affected wind power supplies, exacerbating the effects of a broader regional gas shortage.

Meanwhile, closures in Europe have been easily offset by new construction in Asia. China, India, Indonesia, Japan and Vietnam plan to add more than 600 coal power units. China alone is currently building or planning coal-fired power plants equivalent to six times the total coal-burning capacity of Germany.

The 2010s have been the decade of renewable energy. Rapid increases in technology, massive government subsidies, and falling costs have made seas of solar panels and forests of wind turbines commonplace.

Yet despite the huge deployment of renewables, burning coal remains the world’s favorite way of generating power, accounting for 35% of all electricity. While the share of renewables has grown from 20% to 29% of the global mix in the last decade, coal only lost 5 percentage points in the same period.

Coal is the largest source of carbon dioxide emissions and the largest source of greenhouse gases in the electricity sector. While global CO2 emissions fell by the largest amount on record last year, this was due to a collapse in demand driven by the pandemic, rather than a radical shift in the use of fossil fuels. Global emissions are increasing again this year as the economy recovers and power outages spread across the world.

(Michael Bloomberg, founder and majority owner of Bloomberg LP, the parent company of Bloomberg News, has committed $ 500 million to launch Beyond Carbon, a campaign aimed at shutting down the remaining coal plants in the US by 2030.)

© 2021 Bloomberg

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