Coal Power and National Security
In this paper, Net Zero Watch director Andrew Montford considers the UK’s looming firm generation capacity crisis and the difficulties of obtaining replacement gas-turbines and asks whether it is now necessary to think the unthinkable, and return to coal-fired power.
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Introduction
In an unstable world, energy security – the term encompassing adequacy of supply, instrinsic reliability and resilience to external threats, both natural and manmade – is a pressing concern. This paper argues that that it may best be addressed by the reintroduction of coal-fired power stations to the UK grid. While such as step was unthinkable just 12 months ago, the political landscape is moving quickly. Polling by More in Common has found that that ever-rising energy bills are causing political volatility and fragmentation [1]. Italy and Germany have both recently announced the extension of the lives of their coal-fired power station.
As a result, new voices are being listened to. As a hint of just how far the Overton window has already moved, the Reform party’s manifesto for the Scottish elections featured a pledge to allow the coal mining once again. It clear that the looming geopolitical threats to the country now mean that the time is ripe to reconsider the consensus against coal that has taken hold in the last two decades.
From an energy-security perspective, onshore resources are preferable – imports and offshore production are both vulnerable to the actions of hostile powers, as the sabotage of the Nordstream pipeline in 2022 made clear. In this regard, the UK is horribly exposed. Nearly half of our gas supply comes from Norway. Sabotage of the Langeled pipeline, which alone brings around 20%, would be catastrophic for the UK, and would quickly lead to a civil emergency.
However, renewables are little better. Each offshore windfarm has a long export cable, as much as 200 km long, which are exposed to sabotage in the same way. Moreover, it is clear from the renewables-driven increase in UK electricity prices and our current status as having the most expensive electricity in the developed world means that the current trajectory towards wind and solar is unsustainable. It will not therefore be sustained.
National security is important, but we also face a growing threat to the adequacy of supply, in the shape of the imminent closure of much of our gas-fired fleet. We need to build new firm capacity soon, which means that we should only be contemplating solutions that are ready, ‘off the shelf’.
Nuclear lead times are very long, so new capacity is highly unlikely to be ready before the ‘capacity crunch’ expected at the end of this decade. Moreover, the much-vaunted small modular reactors will almost certainly require subsidy for many years, until the learning curve reduces costs. In the near and medium term, nuclear therefore means higher electricity prices too.
Gas-fired units are currently in high demand because of the growth of AI datacentres. As a result, lead times are extended – perhaps as long as 3–4 years (after permitting) – despite a tripling of prices [2]. (For the UK, those high capital costs, and with gas prices tending to be set by relatively expensive LNG too, mean high electricity prices.)
Coal-fired power stations are relatively slow to build due to their complexity, but if lead times for gas-fired units remain extended, it is possible that they will be deliverable on shorter timescales.
The UK has huge coal resources, and storing large quantities at power stations is simple and straightforward. This means that coal brings major national security advantages over gas.
There are, however, two significant issues. Firstly, we have now exhausted most shallow coal deposits – in other words, the ones that can be accessed relatively cheaply using opencast mining. What remains is found at great depth, and will therefore be expensive to exploit using current technology. However, it is abundant, with billions of tonnes readily accessible, and with unexplored seams offshore thought to contain at least an order of magnitude more [3]. A large coal-fired power station might consume 2 million tonnes per year.
Secondly, UK coal deposits contain moderately high levels of sulphur. These can generate highly corrosive chemistries during combustion, necessitating remedial measures, which add cost.
This paper looks at approaches to overcoming these problems.
Assumptions
Throughout, we assume that the deteriorating state of the UK economy – unsustainably high electricity prices, low growth, deindustrialisation and a declining tax base – means that Net Zero and, along with it, carbon pricing, will be abandoned, not matter which party is in power.
Another prerequisite of regaining energy security is a dramatic scaling back of the burden of environmental regulation and permitting, both to deliver power stations and coal on shorter timescales and at lower cost.
Generating power from coal
There are two main approaches to generating power from coal: combustion with or without prior gasification.
Gasification
Before the advent of North Sea gas, the UK produced ‘town gas’, a mixture of hydrogen and carbon monoxide, by heating coal, usually in the absence of air. Nowadays, a similar process produces so-called ‘syngas’. This is used mainly as a chemical feedstock but can also be used for power generation, particularly where natural gas is scarce. The Great Plains Synfuels plant has been gasifying coal in North Dakota since 1984. China consumes some 380 million tonnes of coal every year for these purposes, while India aims to use 100 million tonnes in the same way, as part of its energy strategy.
Integrated gasification-combined cycle
In this approach, coal is gasified by heating in a stream of air or pure oxygen, but not enough to combust the fuel. The resultant mix of gases is cleaned before being passed into a combined-cycle gas turbine (CCGT), much like those used for normal gas-fired power stations.
This integrated gasification combined-cycle (IGCC) technology is efficient and, importantly, can handle a wide range of coal qualities, or even a proportion of other fuels, such as biomass. However, the technology is far from mature. Units are therefore expensive to build and operate, and indeed projects to date have experienced major cost overruns [4].
With UK coal already expensive, any built here would almost certainly deliver power that was above current market prices were they to exploit domestic supply. Moreover, with CCGTs in short supply, IGCC is not an option for the short term, and is thus of no immediate interest to the UK unless those supply-chain issues resolve themselves.
Underground gasification
As the name suggests, underground coal gasification (UCG) involves producing syngas in situ in coal seams, then piping the resultant gases to the surface for clean-up and subsequent use in a CCGT to generate power [5]. A UCG plant has been operational in Angren, Uzbekistan since the 1960s. This remains the only commercial-scale UCG project in existence, although an experimental project in South Africa appears to remain operational too. However, decades of pilots elsewhere in the world have ended in failure. For example, the Chinchilla project in Australia had to be cancelled after an overpressure in the coal seam led to release of gas, including contaminating chemicals, into the environment.
However, if the approach could be made to work with UK coal deposits, it would be transformational, since it would allow exploitation of our more inaccessible coal seams at much lower cost. The levelised cost of electricity (LCOE [6]) for power produced in this way might in theory be below £50/MWh.
The Chinchilla project involved exploitation of a seam at around 140 metres depth. The UK coalseams are much deeper, reducing the risk to water supplies, but introducing new engineering challenges.
UCG is not therefore a technology that could help us in the short term, but should be a priority for research and development. In passing, it is worth noting that there is research around the world into automating key mining processes. This may eventually reduce costs sufficiently to make traditional mining a viable alternative to UCG as a way to exploit the UK’s deep seams.
Combustion
A standard coal-fired power station comes in two main parts – a combustion unit and a steam turbine. Nowadays, supercritical steam turbines are being superseded by ultrasupercritical (USC) units. The key differences are in the combustion units, where there are two main approaches: pulverised coal (PC) and fluidised bed combustion (FBC) units.
Pulverised coal
In PC units, coal is ground down to a powder before combustion. When used in conjunction with a USC steam unit, this approach gives the highest thermal efficiencies. For example, the Datteln 4 power station in Germany has a thermal efficiency of 48%; the Pingshan 2 design in China boasts 49%.
However, the PC approach is not without its problems. Because of the high temperatures reached, it is not possible to deal with sulphur contamination in the combustion mix.
The mineral content – known as ‘ash’ – is another problem for PC plants, since it can cause wear on the grinding equipment, and can clog up various parts of the power station itself.
As a result, PC power stations ideally use low-sulphur, low-ash coals. If these are not available, ash can be dealt with readily at minimal cost. As a rule of thumb, the additional generation costs for reducing ash in the flue gas are +2% to the LCOE, sulphur adds around 10%, and low-NOx solutions add about 6% [7]. These figures vary with the specific chemical makeup of the coal used.
In the UK, it might be possible to blend domestic production with imported low-sulphur coal, but this would still leave a national security vulnerability. That said, coal is internationally traded and thus supply is reasonably secure.
Either way, PC power stations usually require expensive post-combustion cleanup units to remove sulphates (SOx), nitrates (NOx) and particulates. Capital costs are therefore relatively high, which would likely be problematic alongside an expected high cost for new UK coal supplies.
The indicative LCOE for PC power stations in the UK, running as baseload and utilising imported low-sulphur coal, would theoretically be £49/MWh (Table 1), although the permitting burden that makes UK power projects so expensive, and our lack of a workforce with the requisite skills, would push capital and operating costs much higher, so a figure of over £58/MWh is more likely, at least for the first few units built.
Fluidised bed
Fluidised bed combustion (FBC) uses granular coal rather than powdered. The granules are made to act as a fluid by blowing air through them as they burn.
FBC was previously widely used in the UK because the technology is forgiving of a much wider range of coals, including the relatively high sulphur levels found in UK deposits. SOx pollution can be eliminated almost completely through addition of limestone to the combustion mix. NOx is also unproblematic, since it does not form in significant amounts at the relatively low temperatures of FBC units. Like PC, particulates are dealt with post combustion.
FBC is also an attractive technology because the same plant can consume a wide range of fuels, including biomass, waste coal, petcoke from refineries, and combustible municipal waste. This gives it an edge in terms of fuel security.
Efficiencies of FBC plants have improved in recent decades, but remain lower than PC units. For example, the Łagisza plant in Poland achieves an excellent 43% efficiency. Requiring less post-combustion clean up, the capital and operating costs of FBC units are also lower than PC. So, despite having relatively worse thermal efficiency, FBC’s simplicity means that its LCOE is similar to PC units. Using imported coal, it might be as low as £45/MWh. However, using domestic production (on national security grounds) would lead to a figure of £55/MWh (Table 1).
| PC-USC | FBC-USC | |||
|---|---|---|---|---|
| First of a kind | Nth of a kind | |||
| Capex (£m/MW) | 2.2 | 1.5 | 2.0 | 1.3 |
| Fixed opex (£/MW/year) | 52,000 | 52,000 | 45,000 | 45,000 |
| Thermal efficiency (%) | 48 | 48 | 44 | 44 |
| Coal price (£/t) | 77 | 77 | 100 | 100 |
| Heat content (GJ/t) | 25.0 | 25.0 | 25.5 | 25.5 |
| Capacity factor (%) | 95 | 95 | 95 | 95 |
| Discount rate (%) | 7.3 | 7.3 | 7.3 | 7.3 |
| Marginal cost (£/MWh) | 23 | 23 | 32 | 32 |
| Levelised cost (£/MWh) | 58 | 49 | 64 | 55 |
The same caveat about permitting costs and workforce applies here so, again, £64/MWh or more is likely for the first unit. There is thus a premium of £5–6/MWh for using domestic coal and FBC over imported coal and PC. This may be seen as a small price to pay for the security benefits of avoiding imported fuel.
Coal versus gas
In normal times, CCGTs might deliver baseload power at around £55/MWh (excluding carbon taxes) [8]. However, their capital cost is currently inflated by demand for new datacentres, so levelised costs are approaching £70/MWh even at the gas prices that prevailed during 2025. At current gas prices, that figure is more like £80/MWh. Thus, even if the cost of the first new UK coal-fired power stations was more expensive, they would still be competitive with gas. Assuming that the UK’s marginal supply will in future mostly be LNG, it may be that CCGT costs are not destined to fall far below £70/MWh, so coal should eventually become the cheapest form of generation.
Moreover, even with the first units, the fuel cost of £32 (Table 1) will almost certainly be lower than CCGTs (£43, if LNG at 95p/therm is the normal marginal supply), so coal will be dispatched before gas in a traditional merit order.
Of course, the presence of renewables on the grid would have to be scaled back in order for any investment in firm capacity to make sense.
Moving forward
This paper has shown that, as the UK’s nuclear power stations and older CCGTs retire, there is a strong case for replacing them with new FBC coal-fired power stations. As the title suggests, such a position has, until recently, been seen as outlandish. However, that perception is changing rapidly.
If the analysis presented here is accepted, then there is a pressing need for a national conversation on the subject. The general public are generally unaware of how exposed our energy system is to the actions of malign actors, and the extent to which our economic prospects have been damaged by decarbonisation policy. The political establishment needs to explain the physical reality, namely that renewables can never deliver cheap, secure electricity but that coal, and in particular a new fleet of FBC units, can do so.
If a mandate for change is eventually delivered, there would still be difficulties to overcome – the absence of a suitably skilled workforce, the limited range of suitable equipment suppliers, interference by environmental protestors and so on – but none of these issues is insurmountable. Moreover, we have no choice but to get the better of them if the UK is to reindustrialise, as we surely must.
Endnotes
3. https://euracoal.eu/library/archive/united-kingdom-6/
4. Sometimes due to use of new technologies. The troubled Kemper project, for example, used a new design of gasifier that had not been proven at scale.
5. Takyi et al suggest a CCS-free figure of €49/MWh, citing a 2014 study by Nakaten at al. This would have been £40/MWh at the exchange rate prevailing at the time. Allowing 30% for inflation gives a figure of £51/MWh today. https://www.frontiersin.org/journals/energy-research/articles/10.3389/fenrg.2022.1051417/full#s3
6. LCOE is deprecated for intermittent power sources, so the figures for the dispatchable technologies here are not directly comparable to renewables.
8. Gas at 80p/therm, capital cost of £0.6m/MW, fixed opex of £31,000/MW/yr, 63% thermal efficiency, 90% capacity factor, 7.3% cost of capital.