There are 2300 new coal plants with 1400GW of capacity planned worldwide. China is planning to keep burning coal and to ship electricity to Germany, where the renewable revolution has made power so expensive it may soon be cheaper to get it from half a world away, from coal.
[….] The US still gets roughly one-third of its electricity from coal. Rather than climate change and renewables, the fall of Peabody is largely a story of heavy debt burden and increased competition from shale gas.
And on this front, coal is not alone. New-generation solar energy company and former Silicon Valley darling SunEdison is itself on the verge of bankruptcy after its value plunged from $10bn in July to $650m. The company was once the great hope of renewable energy but has surrendered under the weight of heavy borrowings used to make overly expensive acquisitions as part of a poorly thought through strategy.
While coal has its problems, the collapse of SunEdison, a withdrawal of subsidies across Europe and a move away from onshore wind power in Germany are key developments in the renewable energy markets.
After years of solid growth, the latest research from the International Renewable Energy Agency shows developing countries that already have a high share of renewable energy are unlikely to build this share further.
Developing countries are turning towards fossil fuels to meet the energy demands of their citizens, the IREA says.
This has left a confusing picture on the future demand for coal. A report by Greenpeace says that, since 2010, 473 gigawatts of new coal capacity has gone on line in 33 countries. Eighty-five per cent of these plants were built in China and India, with the rest mostly in Indonesia and Vietnam.
Another report, by renewable energy consultancy Ecofys, says the trend is continuing. There are 2300 new coal plants with 1400GW of capacity planned worldwide, which it says will “take the world off-course from the internationally agreed target of keeping temperature rise below two degrees Celsius above pre-industrial levels’’.
Ecofys concludes that new technology for burning coal will not be enough. “This report discredits claims from the coal industry and governments such as those of Japan, Germany, South Korea, Australia and Poland that efficient coal plants are compatible with climate action,” WWF economist Sebastien Godinot said.
But the World Coal Association maintains new high-efficiency coal technology will deliver power at half the cost of gas and one-fifth the price of wind in Asian countries in the future.
Greenpeace likes to think that China’s future coal plant projections are the result of “dysfunctional planning systems and cheap credit’’.
But there is another possibility highlighted by Britain’s Financial Times: that is, that China’s proposed investment in long-distance, ultra-high voltage power transmission lines will pave the way for power exports from China to as far away as Germany.
Liu Zhenya, chairman of State Grid, told reporters that wind and thermal power produced in Xinjiang could reach Germany at half the present cost of electricity there.
According to the Financial Times, exporting power to central Asia and beyond falls into China’s “one belt, one road” ambitions to export industrial overcapacity and engineering expertise as it faces slowing growth at home.
Australia sees its future importing millions of solar panels and batteries from China to deliver the Turnbull government’s solar and storage revolution. Meanwhile, the Middle Kingdom is planning to keep burning coal and to ship electricity to Germany, where the renewable revolution has made power so expensive it may soon be cheaper to get it from half a world away, from coal.