EU Referendum

Climate change: King Coal


From a week ago, when I was reporting on the global energy crisis which was dominating the headlines, a report from New Delhi tells us that the situation in India is improving slightly.

Out of 135 thermal power plants with a cumulative generation capacity of over 165 GW, only 59 have less than four days' coal stocks. This compares with 19 October when there were 61 plants with less than four days' supply, and 64 on 13 October. As for the number of power plants with zero days of coal, the number has dropped from 15 on Wednesday, with cumulative installed capacity of 16.3 GW compared to 17 projects with 17 GW capacity a week back.

Furthermore, more help is on its way. A giant train, 2½ miles long, its trucks filled with coal, is on its way from the eastern coal fields. Many are calling it the "Coal Express" and believe it will solve the coal crisis in the country. And, irony of ironies, the train is painted green.

As a country, India in 2020 consumed approximately 942 million tonnes (MT) of coal, accounting for 70 percent of India's electricity generation. Some 730 MT of the coal was produced domestically, employing directly 1.2 million workers, according to one estimate.

Looking at the picture in the longer term energy situation, power secretary Alok Kumar is talking on the need for strategic reserves of coal and gas.

At least in the foreseeable ten years or so, he says, "all the countries, especially major economies, will be dependent on fossil fuel supplies for base load and for grid balancing". He does not believe that his country will ever be able to insulate itself from supply shocks from imported fuel, and therefore thinks that a strategic reserve of gas, oil and imported coal, sufficient for "a month or so" will enable the economy to ride them out.

That, says Kumar, "will be a small cost vis-à-vis the cost of these disruptions", pointing out that there were 17 GW of power plants based on imported coal and 24 GW of gas-fired plants which virtually went out of play when prices rose too high.

Now, compare and contrast this with the UK response to the same supply shock. Rather than any talk of insulating us from future shocks with the idea of strategic reserves, both Johnson and Kwasi Kwarteng have focused on reducing our dependence on fossil fuels and increasing the amount of electricity produced by renewables, particularly wind.

But, while our government plays its games, European generators are engineering their own salvation, upping coal production to such an extent that more of it has been used to generate electricity than gas for the first time since 2018. Coal, including lignite, we are told, generated 110 terawatt hours of electricity, while gas generated 92 terawatt hours, in the three months to 30 September.

Stresses are also building up in the European Union, where Poland, amongst others – including the Czech Republic and Hungary - have called on the Commission to consider revising or postponing plans to reduce emissions where they could have "a negative impact on the energy price". Hungarian Prime Minister Viktor Orban has gone so far as to dismiss EU climate policy plans as a "utopian fantasy".

There is not much comfort to be gained from the United States either, where power plants are set to burn 23 percent more coal this year than last, while in China, state coal mines have been ordered to produce "as much as possible" to try and tackle fuel shortages.

China, in fact, is having an interesting time. In the northern part of the country, the winter heating season normally starts on 15 November but has started earlier due to extreme cold weather.

China's Central Meteorological Observatory issued a cold wave "blue" warning at 10 am local time on 15 October, followed by the China Meteorological Administration initiating a "level four" emergency response. As a result, coal supplies have been diverted for power generation, with 13.47 GW and 12.20 GW of coal-fired power units in northeast and east China respectively have been reactivated after being paused temporarily during August and September.

To cope with this, and to ensure sufficient supplies through the winter, China's coal production for the fourth quarter has been increased by an estimated 55 million tonnes. Around 976 coal mines had been reviewed, out of which 153 coal mines have qualified for production expansions, driving production growth of 220 million tonnes.

With power generation rising 10.8 percent year-on-year and utilities sitting on coal stocks of 81.99 million tonnes, equivalent to 15 days of coal supplies, with gas storage reaching 27 billion cubic metres, combining domestic production, pipeline and LNG imports, the immediate crisis is under control.

This makes a nonsense of the CoP26 aspirations for reducing emission levels and demonstrates that, when grown-up administrations are involved, the first priority is to keep the lights on, using any fuel source available – including coal. But that option is not available In Britain, where most of the coal-fired power stations have been shut down. There is limited ability, in the short-term, to reduce reliance on expensive gas supplies.

Not only this, but Johnson's ambitions to lead the world into an emission-free nirvana also seem increasingly precarious as multiple fossil fuel producers, including Australia, Saudi Arabia, Iran and Japan, are lobbying the Intergovernmental Panel on Climate Change (IPCC) to remove recommendations that the world needs to phase out fossil fuels.

Even if the IPPC manages to hold the line, it appears unlikely that Chinese president Jimping Xi will attend the conference, while Vladimir Putin has said he definitely will not be present. And without these two key players, the gathering will lose much of its force, fatally damaging the prospects of a binding agreement Without China’s leader "in the room", the conference is being compared to Hamlet without the prince.

The 25-30,000 delegates are at risk of being marooned in Glasgow in what will become a vast talking shop, with the smaller, developing states trying to squeeze money out of the Western powers, but with the overall conference delivering very little more than high-flown rhetoric.

All that leads to what are described as "official collywobbles" about the outcome, potentially leaving Johnson to "CoP the flop" and tone down his somewhat overblown expectations. Post-Brexit Britain, the Independent says, is supposed to be emerging from its EU cocoon like a gorgeous bright butterfly, attracting the delight and inspiring the hope of all around. Instead it's been swatted and squashed by the old men of Beijing.

For the sake of his vainglorious posturing, though, the UK is still to be saddled with his unrealistic plans for "net zero", forcing the nation progressively to decarbonise, dragging down the economy and impoverishing its citizens. Meanwhile, the rest of the world is paying homage to King Coal, and only lip-service to emission targets.

Fed on a diet of inaccurate and misleading statements from Kwasi Kwarteng, British citizens can only wonder who the British government is working for. It certainly isn't for them.

Also published on Turbulent Times.