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UK Coal Revival Reverses Gains In Green Power Drive

Financial Times

Wholesale price of less-polluting natural gas is soaring a result. Coal burning for power generation by utilities is therefore likely to continue.

The world’s largest offshore wind farm, capable of providing electricity for 600,000 homes, was officially opened this month. Claire Perry, UK energy minister, hailed the Walney Extension, off the north-west coast of England, as evidence of Britain’s sustained push to cut carbon dioxide emissions through renewable power generation.

But on the other side of the UK, in the same week the Walney Extension was unveiled, the arrival of hulking ships chartered by commodity trader Glencore and carrying coal to the Port of Immingham on Humberside highlighted near term brakes on Britain’s pursuit of clean energy sources.

The combined 500,000-tonne cargoes underlined how demand for coal — one of the most polluting fossil fuels — in power generation by utility companies has rebounded in the UK in recent times, despite the government’s plans to eliminate its use by 2025.

Coal’s mini revival with the utilities has been driven primarily by a surge in the UK wholesale price of less-polluting natural gas — it reached a 10-year high this month. The rise has in turn highlighted vulnerabilities in the UK’s energy system, which has become increasingly reliant on expensive gas imports.

It became cheaper to generate power from coal than gas in late August, according to a report written by Iain Staffell of Imperial College London for the utility company Drax.

“It’s not a flash in the pan,” he said. “There could well be a whole season where coal is the baseline fuel [for power generation by utility companies]. We could be looking at the first year-on-year increase in emissions in six years.”

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