Climate obstruction bingo

From CommsDeclare 

Coal price continues to slide

 I mentioned this a few days ago.  The slide continues.  It's punched right through the previous highs of $110-$120 in 2011, 2016, and 2018.  From the technicals/chartist  PoV, the next stop will probably be around $50, though it might stop briefly at $65.

Is this a sign of Chinese economic weakness, or of the shift to renewables in China?  Prolly, mostly the latter.  I'll do my Chinese leading and coinciding indices if I get a chance later today to get a better handles on the fundamentals.

Coal price slides

 This is the coal price at Newcastle (Australia).  From the perspective of a "technical analyst"  or "chartist", i.e., one who looks at charts of price trends, this is a very significant downward break.  The thick red line is a 120 (working-) day moving average, and the thin red line is a 30 (working-) day moving average.  The 120-day moving average represents, if you like, the fundamental underlying trend; while the shorter moving average can be thought of as a "trading" trend.

If the price series is below its moving average, and the moving average is falling, that's a strong sell signal.  This is the case with both moving averages.  In addition, the most recent price is below recent lows.  This is called "breaking down" and is also bearish.  Notice, too, the rally since the beginning of this year.  It took the price back to the short-term moving average, and then fell to new lows.  This is another bearish sign.

Why is this happening?  Well, "chartists" say it doesn't matter.  To them, the fundamentals (supply/demand) don't matter.  To them, the price tells you everything you need to know: sell.

I no longer follow the supply/demand data, so I don't know for certain what is happening.  But I suspect that China's and Europe's roll-out of renewables is driving down demand.   Many observers confused the number of coal-fired power stations that China has built recently with increases in coal demand.  But they ignored the sustained downtrend in capacity factors in coal generation.  Chinese utilities, which are not driven by the same need to make profits as Western utilities, built coal pants as backup for their renewables, when drought (caused by global warming!) led to a plunge in hydroelectricity output and a nationwide power crisis.  The very rapid increase in wind and especially solar+battery roll-outs has meant that less and less coal is needed.

The behaviour of the coal price suggests that China's emissions have in fact peaked.   And from an investment perspective, coal is most definitely not a buy. 

This is the long-term (multi-year) chart:

Note how the long-term moving average got all the major cycles right
over the last 25 years, with only 4 "whipsaws".

Which countries are most reliant on coal?

 From Visual Capitalist

This was originally posted on Elements. Sign up to the free mailing list to get beautiful visualizations on real assets and resource megatrends each week.

Global energy policies and discussions in recent years have been focused on the importance of decarbonizing the energy system in the transition to net zero.

However, despite efforts to reduce carbon emissions, fossil fuels still account for more than 80% of primary energy use globally—and coal, the world’s most affordable energy fuel, is also the largest source of energy-related CO2 emissions.

The graphic above uses data from the Statistical Review of World Energy to show how much select countries rely on fossil fuels, particularly coal.

China's peculiar coal policy

From Reuters

China's plans for some 100 new coal-fired power plants to back up wind and solar capacity have sparked warnings that the world's second-biggest economy is likely to end up lumbered with even more loss-making power assets.

Analysts question the logic of policies that intend to reduce the role of the dirtiest fossil fuel but at the same time require more coal-fired power plants to be built - especially given that only a small number of older plants are typically retired each year.

The plans also highlight how local government interests have impeded the development of an effective nationwide power market that would allow surplus power to be delivered to regions that need it, they add.

"The reality is that China has more coal power capacity than it needs," said Zhang Shuwei, director at Draworld Energy Research Centre. "It doesn't make sense to give more incentives for more coal-fired power investments."

China is the world's largest and fastest-growing producer of renewable energy, which is expected to account for a third of all power supplied to its grid by 2025, up from 28.8% in 2020.

But it was scarred by a record drought last year that slashed hydropower output, forcing factories throughout the southwest to shut down and raising concerns that power shortages could undermine its post-COVID economic recovery. The experience increased its determination not to be too reliant on the intermittent nature of wind and solar power and has made China the only major economy building new coal-powered plants.

The construction of 106 gigawatts of coal-fired power was approved last year - four times more than in 2021 and the highest amount since 2015, according to research published last month by the Centre for Research on Energy and Clean Air (CREA) and Global Energy Monitor (GEM).

That's equivalent to about a hundred large coal-fired plants and enough to supply the whole of Britain. At least 50 GW of that capacity began construction in 2022, the report said.

China's National Development and Reform Commission (NDRC) has also flagged that at least 200 GW of coal capacity is expected to be deployed to support renewable power.

China's big jump in coal power approvals has sparked fears that there will be backsliding on its climate goals.

The CREA-GEM report says it won't necessarily mean the sector's coal use or carbon emissions will climb. But for China to make good on its goals - namely a peak in emissions before 2030 and becoming carbon neutral by 2060 - the loss-making sector's plant utilisation rates will probably have to slide further.

Coal accounted for 58.4% of China's total power generation last year, but high prices have meant many plants have suffered losses for years. More than half of the country's large coal power firms were loss-making in the first half of 2022, according to the China Electricity Council.

And even though many plants were producing more last year to compensate for the decline in hydropower output, the average utilisation rate inched down to 52.4%.

Analysts note existing coal plants could provide sufficient backup for renewables if they were plugged into a nationwide market, but China's power sector remains fragmented.

Historically, power plants have been built to support local industry and local GDP growth rather than national power supplies, with provinces reluctant to rely on other provinces for their needs.

Power plants are also not motivated to maximise power output because prices are fixed for residential users while price hikes for business users are limited to 20% of the fixed tariff.

The NDRC has been working on capacity payment mechanisms that compensate coal power plants for the decline in earnings as they adjust to their new role as backup suppliers.

The drought-prone southwestern province of Yunnan, which depends on hydropower for most of its electricity, recently set up a capacity market in which coal plants are paid to be available to fulfil supply shortfalls. Other regions are also involved in pilot schemes.

"I think the expectation of these capacity payments is one motivation for coal power groups to pursue new projects despite the fact that power generation from coal is unprofitable at the moment," said Lauri Myllyvirta, lead analyst at CREA.

It is also unclear who will be paying for the subsidies, said Zhang at Draworld Energy, adding it would be "terrible news" if the costs were to be shouldered by renewable power generators.

Yunnan's provincial planning agency did not respond to a request for comment.

Instead of building expensive new plants, China could instead encourage existing plants with surplus capacity to deliver electricity to regions that need it the most, said Matt Gray, chief executive of think tank TransitionZero.

"It would be far cheaper... to incentivise provincial trading than incentivising new loss-making coal," he said.

 China and coal are key to cutting emissions.  China is the world's biggest coal user.  It's also the world's biggest emitter.   

Fossil fuel price fall as world econ slows

 ... and perhaps, as EVs reduce oil demand and renewables reduce coal demand over and above the decline due to a slowing economy.

The coal price is falling fast:

India to pause new coal plant construction

From Associated Press

The Indian government will not consider any proposals for new coal plants for the next five years and focus on growing its renewables sector, according to an updated national electricity plan released Wednesday evening.

The temporary pause in the growth of the dirty fuel was hailed by energy experts as a positive step for a country that is currently reliant on coal for around 75% of its electricity.

Updated every five years, the plan serves as a guideline for India’s priorities in its electricity sector.

India is the world’s third highest emitter and most populous country. It plans to reach net zero emissions by 2070, which would mean significantly slashing coal use and ramping up renewable energy.

In a draft of the plan released in September, the Central Electricity Authority, which is in charge of planning for India’s electricity needs, projected that nearly 8,000 megawatts of new coal capacity was required by 2027. But Wednesday’s strategy proposes the build out of more than 8,600 megawatts of battery energy storage systems instead.

Battery storage is crucial for round-the-clock use of renewable energy.

“This plan is a step in the right direction,” said Raghav Pachouri, an energy sector expert at Vasudha Foundation, a New Delhi-based think tank.

Pachouri said one reason the plans for new coal might have been scrapped is because there are already some coal plants under construction.

The country is also experiencing longer summers and hotter weather in part due to climate change, meaning greater electricity demand during the scorching day, making it easier to fulfill energy needs with renewables, said Pachouri.

“When you need energy during the day, solar power can provide for it,” he said.

India plans to install 500 gigawatts of clean energy by 2030, enough energy to power anywhere from 150 to 500 million homes depending on power use, but is not on course to meet that target, according to Aditya Lolla, an energy analyst at the think tank Ember.

“We’re installing only up to 17 gigawatts a year, this needs to increase to 40 to 45 gigawatts to meet targets,” said Lolla.

The new plan goes on to project that new coal power will be built after 2027, but Lolla says this should be taken with a pinch of salt.

“Traditionally, projections for the coming five years are more concrete and those for the subsequent years are essentially placeholders,” said Lolla. “India wants to move towards a cleaner power system. With every electricity plan, the coal pipeline is falling.”

Lolla predicts that with the current volatile global energy picture, due to Russia’s war in Ukraine, climate change and pandemic recovery, India will take a call on its longer-term energy plan at a future date, depending on how things progress by 2027.

Workers install solar panels on the roof of a residential apartment in Kochi, southern Kerala state, India, March 22, 2023.  (AP Photo/R S Iyer, File)

There are only a few countries still building new coal power stations.   India was supposed to save world coal mines, but it seems likely that India's coal use is close to peaking, though India still has 28.5 GW of capacity in its coal power station pipeline.   This compares to China's 250 GW.    

China still aggressively expanding coal power

From The South China Morning Post

China’s aggressive expansion of coal power projects last year set back global efforts to phase out existing plants, which is crucial in the fight against climate change, according to a new study.

Coal-powered capacity in operation in developed and developing countries fell in 2022 as existing plants were retired and proposed projects were cancelled, except in China where new projects are coming up as local governments heed Beijing’s call to ensure energy security.

New coal capacity under development in China increased 38 per cent to 366 gigawatts (GW) last year, while it decreased 20 per cent elsewhere, which drove global projects under development to 537GW, up 12 per cent after hitting a record low in 2021, according to the annual survey released on Thursday by San Francisco-based Global Energy Monitor (GEM) and 12 other climate non-profit organisations.

Globally, 45.5GW of coal capacity was commissioned in 2022, with nearly 60 per cent coming from China, according to the report. And although 26GW of coal capacity was retired globally last year, the world’s coal-powered fleet grew by 19.5GW, an increase of less than 1 per cent compared with 2021.

“The more new coal projects come online, the steeper the cuts and commitments need to be in the future,” said Flora Champenois, lead author of the report and project manager for GEM’s global coal plant tracker. “At this rate, the transition away from existing and new coal isn’t happening fast enough to avoid climate chaos.”

The GEM report came as the United Nations’ climate body, the Intergovernmental Panel on Climate Change (IPCC), warned in its latest report last month that current plans and pace of climate actions are insufficient to meet the Paris climate agreement of limiting global warming to under 2 degrees Celsius by the end of this century

China’s aggressive expansion of coal power projects last year set back global efforts to phase out existing plants, which is crucial in the fight against climate change, according to a new study.

Coal-powered capacity in operation in developed and developing countries fell in 2022 as existing plants were retired and proposed projects were cancelled, except in China where new projects are coming up as local governments heed Beijing’s call to ensure energy security.

New coal capacity under development in China increased 38 per cent to 366 gigawatts (GW) last year, while it decreased 20 per cent elsewhere, which drove global projects under development to 537GW, up 12 per cent after hitting a record low in 2021, according to the annual survey released on Thursday by San Francisco-based Global Energy Monitor (GEM) and 12 other climate non-profit organisations.

Globally, 45.5GW of coal capacity was commissioned in 2022, with nearly 60 per cent coming from China, according to the report. And although 26GW of coal capacity was retired globally last year, the world’s coal-powered fleet grew by 19.5GW, an increase of less than 1 per cent compared with 2021.

“The more new coal projects come online, the steeper the cuts and commitments need to be in the future,” said Flora Champenois, lead author of the report and project manager for GEM’s global coal plant tracker. “At this rate, the transition away from existing and new coal isn’t happening fast enough to avoid climate chaos.”

The GEM report came as the United Nations’ climate body, the Intergovernmental Panel on Climate Change (IPCC), warned in its latest report last month that current plans and pace of climate actions are insufficient to meet the Paris climate agreement of limiting global warming to under 2 degrees Celsius by the end of this century.

In an “Acceleration Agenda” released along with the IPCC report, the UN urged that all existing coal plants must be retired by 2030 in the world’s richest countries, and by 2040 everywhere, and there is no room for any new coal plants.

To meet the UN’s requirement of phasing out coal power by 2040, the pace of retiring coal fleet needs to move four and half times faster than last year, which means retiring an average of 117GW per year, according to GEM.

OECD countries need to retire an average of 60GW of coal power each year to meet their 2030 phase-out deadline, and for non-OECD countries, 91GW each year for their 2040 deadline. For the 537GW of coal capacity under construction and consideration, the required pace of retirement would have to be even steeper, the report said.

The report also raised the alarm over China’s rapid coal power expansion, which could single-handedly reverse progress being made across the rest of the world on coal plant retirements.

China, the world’s largest coal producer and consumer, has embarked on a rapid expansion of its coal fleet since an initial wave of power outages closed factories and homes across half the country in 2021. A drought-induced power shortage in China’s hydro-rich regions such as Sichuan province last year further prompted officials in Beijing to order provincial authorities to ramp up coal production to ensure power security.

Although the country has committed to phase down coal use from 2026 to reach its 2060 carbon neutrality goal, coal is likely to remain at the core of China’s energy infrastructure to ensure stable power supply, former premier Li Keqiang signalled in a speech at the annual meeting of the National People’s Congress last month.

China curbing the use of coal is crucial to the global fight against climate change, analysts said.

“Outside China, the response to the energy crisis was dominated by investments in clean energy. However, that progress urgently needs to be accelerated,” said Lauri Myllyvirta, the lead analyst at the Centre for Research on Energy and Clean Air.

“China pulled in the opposite direction, sharply increasing planned coal power capacity, showing the need to deploy clean solutions and better enforcement of existing policies that should restrict new coal power projects,” he said.

Source: Statista
Global emissions continue to rise.  To have any chance of limiting the rise
in the global average temperature to 1.5 degrees C,
emissions need to start falling.

China moves towards emissions tipping point

From Bloomberg

Welcome to Energy Daily, our guide to the energy and commodities markets powering the global economy. Today, Energy Reporter Dan Murtaugh reflects on China’s solar power and EV booms, and suggests the country is reaching a tipping point in its energy transition. To get this newsletter sent straight to your inbox, you can sign up here.

A singer wailed while a guitarist ripped off a solo in front of a crowd so packed it was impossible to walk through. But this wasn’t a rock concert. It was the scene around automaker BYD Co.’s booth at a Chinese solar power conference.

The SNEC PV Power Expo drew around half a million people to the Shanghai New International Expo Center last week: everyone from European utility executives looking for deals on panels to curious tourists hoping to grab some free merchandise.

As well as BYD, China’s largest automaker, Tesla Inc. was there, along with Contemporary Amperex Technology Co. Ltd., the world’s biggest electric vehicle battery manufacturer. They joined thousands of domestic solar companies. The buzz was reminiscent of the auto show in Shanghai a month earlier, when onlookers thronged around the latest EV models.

The excitement around solar and EVs suggests China is nearing an inflection point in its energy transition more than a half-decade before a 2030 target to peak emissions. It no longer requires heavy government subsidies to push people away from fossil fuels. Cheap solar panels are a better way to make money than burning expensive coal, while EVs are cheaper to operate — and increasingly more fun to drive — than gasoline-powered vehicles.

BloombergNEF lifted its forecast for China’s 2023 solar installations last week. It now expects the country to add nearly three times the capacity it did just two years ago, or more than the entire total in the US. EVs, meanwhile, made up more than a third of all vehicle sales in China last month.

That’s bringing China closer to the tipping point where fossil fuel use falls into long-term decline, a milestone that could be reached as soon as next year, according to the Centre for Research on Energy and Clean Air.

The road ahead won’t be easy — grid improvements will be needed to keep solar going at its current pace, panel manufacturers face shrinking margins on robust competition, and battery makers will need to avoid supply chain bottlenecks.

The planet’s largest polluter still burns a lot of coal. But the progress on solar power and EVs show it’s well on its way to a less carbon-intensive future.

Source: Reuters

I've hoped for this before, but have been disappointed.   Yet the growth of solar and EVs in China is so extraordinary that this time it may be true.  Chin is responsible for 25% of global emissions.  If her emissions are close to peaking, that is extremely good news.  

India to build no new coal plants

 From Reuters

India plans to stop building new coal-fired power plants, apart from those already in the pipeline, by removing a key clause from the final draft of its National Electricity Policy (NEP), in a major boost to fight climate change, sources said.

The draft, if approved by the federal cabinet chaired by Prime Minister Narendra Modi, would make China the only major economy open to fresh requests to add significant new coal-fired capacity.

India and China account for about 80% of all active coal projects as most developing nations wind down capacity to meet climate targets. As of January 2023, only 20 countries have more than one coal project planned, according to E3G, an independent climate think tank.

"After months of deliberations, we have arrived at a conclusion that we would not need new coal additions apart from the ones already in pipeline," one of three government sources said.

The sources declined to be identified as they are not authorised to speak to the media. India's power ministry did not respond to requests seeking comment.

The new policy, if approved, would not impact the 28.2 GW of coal-based power in various stages of construction, the sources said.

China and India have together been lobbying for freedom for countries to choose a roadmap to cut emissions.

India, whose proposed coal power capacity is the highest after China, had repeatedly refused to set a timeline to phase out coal, citing low per-capita emissions, surging renewable energy capacity and demand for inexpensive fuel sources.

Coal is expected to be the dominant fuel in generating electricity in India for decades, but activists have pressed for a halt to new coal-fired plants, arguing this would at least help to reduce the share of the polluting fuel in overall power output.

The draft, India's first attempt at revising its electricity policy enacted in 2005, also proposes delaying the retirement of old coal-fired plants until energy storage for renewable power becomes financially viable, the sources said.

So far, old coal-fired power plants with a cumulative capacity of 13 GW have been earmarked for functioning post retirement deadline to meet high power demand, they said.

In the first draft of the NEP in 2021, India had said it may add new coal-fired capacity, though it proposed tighter technology standards to reduce pollution.

The Central Electricity Authority, an advisory body to the federal power ministry, had said last year India might have to add as much as 28 GW of new coal-fired power in addition to the plants under construction to address surging power demand.

However, the final draft, which will guide India's policymaking on energy over the next decade, features no references to new coal-fired power, the sources said.

In contrast, China's National Development and Reform Commission said in a March 2022 document that outlined its energy policy, that the world's largest coal user "will rationally build advanced coal-fired power plants based on development needs."

China plans to build some 100 new coal-fired power plants to back up wind and solar capacity, which analysts said goes against Beijing's stated intention to reduce the role of coal.

The policy revision could also impact long-term coal prices and miners in Indonesia, Australia and South Africa, as India is the world's second-largest coal importer.

But emissions continue to rise:

We are not yet at peak coal.  Which means emissions haven't yet peaked.  Depressing.

China's GDP & climate goals clash

From The Guardian

China’s energy policies are fast creating a type of “emissions ambiguity”, as the twin goals of boosting GDP growth and reducing carbon emissions come into conflict.

The uncertainty is whether and when the world’s biggest carbon emitter will start to curb greenhouse gas pollution. The release of the country’s annual statistics communique on Tuesday did not clear things up.

As Lauri Myllyvirta, an analyst at Centre for Research on Energy and Clean Air, noted this month, China’s carbon emissions may have risen 1% or fallen by that amount in 2022.

A crude conversion of the 3% GDP growth reported by China and its 0.8% reduction in the carbon intensity of economic activity – as stated in the communique – indicates emissions may have risen 2.2% last year.

The calculations matter as China emits more than a quarter of global emissions, roughly twice as much as the next largest, the US.

In November 2021, China told the UN it would reach carbon neutrality “before 2060”, and President Xi Jinping has also promised to reduce coal consumption by the 2026-30 period, but has not said when China will stop building new power plants.

Pollution growth should also have been subdued in 2022, a year when economic activity was slowed by rolling Covid curbs. Excluding 2020, which included the worst of the pandemic disruptions, GDP growth last year was the weakest since the 1970s.

Local officials often use big infrastructure projects, such as power plants, to boost economic activity in their areas. There will be even more pressure to stimulate growth after the GDP target for 2023 is announced at the National People’s Congress, which starts on 5 March. The national target is expected to be about 5%.

As Myllyvirta’s centre reported on Monday, China was busy granting permits for an average of two power plants a week in 2022, or six times more capacity than the rest of the world combined. One executive boasted of securing approval to build a 4,000-megawatt coal-fired plant in just 63 days after taking ownership of the project.

“China has not seen such a wave of new permits for new coal-fired power plants since the permitting frenzy of 2015, when provincial governments were given the authority to approve new projects,” the report says.

Should a large proportion of the 106GW of new coal projects permitted – more than four times 2021’s 23GW tally – begin operation, global efforts to keep climate heating to the Paris accord temperature limit of 1.5C are, frankly, cooked.

“One of the clear upshots is that China is now very significantly behind its energy and carbon intensity targets for 2025”, Myllyvirta said.

But here is where the ambiguity lies. Permitting does not equate to construction, and since many of the proposed plants are in regions already oversupplied with power, it is not clear new capacity will necessarily equate to extra coal combustion.

And, as Myllyvirta highlights, numbers in the communique stating that coal consumption rose 4.3% in 2022 and total energy use rising 2.9% “appear to contradict weak or falling industrial output”.

The 3.1% drop in oil consumption and a 1.2% fall in gas use – the first fall in at least 20 years – also point to suspiciously weak demand in the economy.

Of course, while China is pouring money into building new coal plants, it is also leading spending on renewable energy and low-carbon products such as electric vehicles – even if the US Inflation Reduction Act looks to challenge that primacy. The IRA pledges, among other things, to result in 950m new solar panels and 120,000 new wind turbines in the US by 2030.

China added a record 125GW solar and wind capacity in 2022, with about two-thirds of that solar, the Centre for Research on Energy and Clean Air says.

According to the official communique, clean energy consumption – which includes nuclear and hydropower – rose 0.4 percentage points last year to 25.9%. That’s still less than half coal’s share at 56.2%.

China’s output of solar panels totalled 340m kilowatts of capacity, up almost half on 2021’s level. Production of so-called new energy vehicles, most of which were plug-in electric, soared 90.5% to just exceed 7m units, the communique says.

Why those solar panels and zero-emissions cars might come in handy was hinted at in another statistic that China’s policymakers must keep in mind when considering the urgency of tackling pollution.

“Of the monitored 339 cities at prefecture level and above, 62.8% reached the air quality standard and 37.2% failed,” the communique says.

Very depressing news.   China produces 25% of annual CO2 emissions.  It is by far the largest emitter.  

My last post had the good news of a probable 20% decline in European emissions for electricity generation this year.   This fall is completely offset by the rise in Chinese emissions.  And, it's not as if China isn't perfectly aware of the impact of global warming on the country: desertification in the west; more and worse floods in the east and south; and rising sea levels (64 million people are at risk of sea level rise, and 1/3rd of GDP would be impacted)   The most optimistic take on this is that China will only use these new power stations when supply from other sources is low.  Who knows?  

On the face of it, deeply depressing news.  

Renewables soon to overtake coal

From Statista

With hundreds of protesters currently trying to halt the continued development of a coal mine in Germany - which would involve the destruction of the now abandoned village of Lützerath, the further pursuit of fossil fuels in a country ostensibly seeking to phase them out is under the spotlight. The main justification used by the German government is that the country's hand has been forced by the massive gap left by Russian oil and gas. At least in the short to medium term, coal has been selected is one answer to Germany's significant problem.

Longer term, it's renewables that are planned to dominate Germany's electricity mix, and this is something reflected by an International Energy Agency forecast. As this infographic shows, global use of coal for electricity generation outweighed that of renewables by 8 percentage points. By 2027, this is predicted to flip, with renewables accounting for 38 percent of global electricity production compared to 30 percent from coal.

The IEA report, released since the Russian invasion of Ukraine, says that the war has led countries "to increasingly value the energy security benefits of renewable energy." Although some of the shorter term solutions may be focused by necessity on fossil or nuclear sources, the future is looking more green. An additional factor in this ongoing shift quoted in the report were the "high fossil fuel and electricity prices resulting from the global energy crisis" that have "made renewable power technologies much more economically attractive".

My own opinion is that this transition will happen faster than the IEA thinks.  The IEA was founded to support fossil fuels and nuclear and it has consistently underestimated the speed of the transition to renewables, and the cost declines in wind and solar;  plus the advantages of reducing reliance on blood-thirsty petro-states have become obvious to governments.

Coal's executioners gather

German ski slope, January 2022

From The Age

The savage winter heat in Europe over recent days has been so surreal that observers are running out of words to describe what they are seeing. Maximiliano Herrera, a climatologist who tracks global weather extremes, told The Washington Post that the weather was “totally insane” and “absolute madness”. The heatwave was, he said, “the most extreme event ever seen in European climatology”.

In Poland, on New Year’s Day, the temperature peaked at almost 19 degrees, 15 above average. In parts of the continent winter temperatures at night were more typical of summer days.

About the same time, a cold snap caused by a polar vortex gripped North America, killing directly and indirectly more than 200 people.

In Australia, the Bureau of Meteorology is predicting that the La Nina weather pattern that has caused both horrific flooding and cooler temperatures across the Southern Hemisphere is showing signs of dissipating. With this climatological Band-Aid torn away, there are fears the fierce heat La Nina’s clouds has protected us from over the past couple of years will suddenly return, exposing us to the true temperatures of a warmer world.

All this comes as Russia’s war of aggression drags towards its second year, causing not just untold misery for millions Ukrainians but a global energy crisis that has propped up demand for dangerous fossil fuels and super profits for the companies that peddle them.

In this context, it is difficult to address positive news on climate action, but it is there and it is worth addressing. According to the International Energy Agency’s most recent report on coal, published last month, the rise in coal demand prompted by the energy crunch was limited to just 1.2 per cent, and it is not expected to last long.

And despite that war-related jump, the global seaborne coal trade in 2022 is likely to have been between 5 and 8 per cent below pre-pandemic levels. Europe’s overwhelming response to the energy crunch has been to buy gas whereever it can find it and to pump eye-bleeding sums of money into energy efficiency measures and renewable energy technology.

Coal’s new high price might be creating short-term profits, but it is also destroying demand.

As a result, the sprawling coalition of government and activist forces dedicated to killing off coal now believes the first phase is already achieved – the pipeline of new coal power stations has effectively been shut.

Countries such as China an India are still building plants permitted and contracted over the past decade, but are rapidly turning towards renewables. At the end of 2021, the coal industry’s key financiers – China, Japan and South Korea – declared they would no longer invest in new offshore coal plants.

As an Australian miner complained in a parliamentary inquiry last year, banks no longer wanted to finance coal projects because the “grief to income ratio” was not worth it. Activist shareholders were becoming too much of a pain.

Camilla Fenning, who leads the coal program for the British-based climate think tank E3G, told me this week the speed of the retreat from coal over the past couple of years has been startling.

“There are now only around 35 countries that have a coal pipeline [of planned new plants],” Fenning said. “None of those are now in Europe, and only four are in the OECD – that’s Turkey, Australia, the US and Japan. Of those 35 countries, something like 16 only have one planned new coal plant, so even they are near the tipping point of no new coal.

“And also, of those 35, probably half of them were dependent on China or Japan or Korean investment, and now they have pulled the plug, it’s pretty unlikely they will get the investment to build. So now we have a domino effect.”

And with coal costs so high, even China’s new plants are running far below capacity.

The problem is that a new coal plant lasts for about 40 years. So even with the pipeline of new plants cut to a trickle, if the existing global fleet is allowed to live for the course of its natural life, the emissions it creates will blow the world’s limited remaining carbon budget to keep warming under 1.5 degrees or even 2 degrees.

So now the anti-coal movement has shifted its attention to how it can most effectively shut them down sooner.

Huge steps were taken in this direction at the last two world climate talks in Glasgow in 2021 and Sharm El-Sheikh in November. In Glasgow, a new model to accelerate the process was finalised and announced.

Under the so-called Just Energy Transition Investment Partnership (or JET IP, as it is now referred to in the jargon-rich world of climate diplomacy) the United States, Britain, Germany, France and the European Union agreed to provide $US8.5 billion ($12.59 billion) in grants and cheap loans as seed money for a fund to purchase and close South Africa’s coal fleet and replace it with renewables.

South Africa is the perfect laboratory for such a program because it has a some of the world’s best access to sun and wind. And because it has, even by a dirty industry’s standards, a particularly dirty coal fleet. As a result, a dollar spent greening South Africa cuts far more carbon than a dollar spent in, say, Europe.

The model is also in keeping with one of the Paris Agreement’s core principles, which recognises that nations have “common but differentiated responsibilities” in tackling climate change.

In simple terms, this means that poor nations agreed to take action if rich ones – which caused the problem in the first place – agreed to pay for it.

In Egypt in November, the JET IP backers and South Africa detailed impressive progress in the plan and now negotiations have begun for similar agreements to accelerate coal retirement in Indonesia and Vietnam. Because each nation has different energy demands and different coal industries, developing the plans is complicated, says energy analyst Tim Buckley.

And care must be taken to ensure the money is well spent. There is no point in buying out a coal plant only to later see it resold, Buckley explains. Nor is there any point in shutting off the power before it is adequately replaced with clean alternatives.

Due to generations of failure to properly address climate change, even this rapid progress is not fast enough, says Fenning. She hopes the South African model will be improved as versions of it are deployed in Indonesia and Vietnam, and then, hopefully, across the world.

Many climate scientists believe the 1.5 degrees target has already slipped from our grasp, though rapid decarbonisation could see temperatures stabilise and then slowly drop by the end of the century.

Until then, we will face unfeasibly warm winters across Europe, and a return to infernal summers in Australia.

Indian metal producers switch to renewables

From Bloomberg

India’s metal producers are speeding up their transition to renewable power after a coal crisis led to a supply crunch and sky-high prices of the fossil fuel, according to Greenko Energy Holdings.

GIC Pte.-backed Greenko, one of India’s largest renewable energy companies, signed an agreement earlier this month with Hindalco Industries Ltd. to provide carbon-free electricity to the aluminum producer’s Odisha smelter for 25 years, following a similar deal with ArcelorMittal Nippon Steel India Ltd.

Greenko is now in talks with two to three other metal producers for round-the-clock power supply, co-founder Mahesh Kolli said, declining to name the firms.

The coal crisis is “a big factor that accelerated this transition” to renewable power from coal-based energy usage, Kolli said in an interview. The metals industry in India is willing to invest in renewable energy and build solar plants, adding a big funding source for clean energy, he said.

The country is emerging from an acute power crisis after a blistering summer and a post-pandemic industrial revival, which spurred electricity demand and overwhelmed domestic coal output. That prompted some metal producers to scour global markets for supplies, where prices are trading near record levels.

The increased expenses slashed profits of some of the biggest mills in India at a time when commodity prices were rallying to multi-year highs. They are now exploring ways to minimize their dependence on coal, with renewable energy looking more attractive.

“In this carbon-free energy that we are giving, this price is fixed for the next 25 years,” Kolli said. “So now at least when the price goes up, they benefit a lot.”

ounded in 2004, Hyderabad-based Greenko develops solar, wind and hydro power projects with 7.5 gigawatts of operating capacity across 15 states in India. Aside from GIC, it counts Abu Dhabi Investment Authority and Japan’s Orix Corp. as investors.

Greenko uses hydro-pumped storage technology to ensure round-the-clock power to the mills. Unlike Europe and the US, where storage costs are high, developers in India have been following a similar model to China and have managed to control the expenses using this cheaper technology, Kolli said.

Greenko expects to benefit as India’s renewable market opens up due to rapid industrial decarbonization. Currently, India’s renewable energy market is dominated by state-run power utilities as the government has ordered them to buy a certain percentage of clean electricity. To spur industrial carbon reduction efforts, India’s power ministry has changed rules to allow large power consumers to buy green electricity directly from a supplier of their choice without having to pay heavy charges to the state distribution utilities.

“The industrial decarbonization, without putting obligations on utilities, is a four to five times bigger opportunity for renewables,” Kolli said.

Coal is NOT making a comeback in Europe

From EMBER

Putin’s energy blackmail has left the EU with few options. Had renewable energy capacity been rapidly expanded, Europe would not need coal to keep the lights on.

Germany, Austria, France and the Netherlands have recently announced plans to enable increased coal power generation in the event that Russian gas supplies suddenly stop. This would allow gas that was being used for electricity production to be diverted elsewhere, in particular into gas storage facilities so they can reach the required 90% full levels by November.

In total, 13.5 GW of coal-fired plants will be placed on stand-by in supply reserve facilities, adding 12% to the EU’s existing coal fleet (109 GW) and only 1.5% to its total installed power generation capacity (920 GW).

The use of coal is only a last resort, short term measure, with consensus in Europe that the only way to extricate itself from cost and security crises is to get off fossil fuels. Germany remains firmly committed to its coal exit plan. The government has reiterated, “the coal exit in 2030 isn’t wobbling at all. It is more important than ever that it happens in 2030.” The Netherlands is not amending its 2029 coal phase-out date. France is only allowing Emile Huchet to be in reserve for this winter. And Austria has clearly stated that the Mellach plant is coming out of retirement “so that in an emergency it can once again produce electricity from coal (not gas)”.

These temporary measures will only result in increased coal burning if Russia cuts gas supply further. If this does not happen the coal plants will not come back online. If all the plants do operate and run at 65% of their 13.5 GW capacity, it would result in 60 TWh of additional coal power generation in 2023. This equates to 14% of 2021 EU coal electricity production and 2% of 2021 EU total electricity production. From a climate perspective, the net additional CO2 emissions in 2023 would be approximately 30 million tonnes, representing 4% of 2021 EU power sector emissions and 1.3% of total 2021 EU CO2 emissions. So while it would be preferable to avoid any increase in emissions, the temporary uptick will not derail the EU’s longer-term climate goals.

The current crisis has acted as a catalyst for an accelerated European clean energy transition. Fossil gas is no longer viewed as a viable transition fuel and instead Europe is implementing a much faster transition away from both coal and gas.

In May, the European Commission published its updated REPowerEU communication. In those plans, it had already incorporated an increase in coal power (+105 TWh) and falling gas power (-240 TWh) without derailing EU climate objectives.

“Despite temporarily higher coal use in power generation, the climate ambition levels are reached since REPowerEU leads to investments in renewables and energy efficiency beyond the Fit for 55 proposals.”

The proposals include a massive ramp-up in wind and solar deployment, with renewables accounting for 69% of electricity production by 2030. And a recent Ember report shows that nineteen European governments have accelerated their decarbonisation in response to the Covid-19 pandemic, gas crisis and Russia’s aggression.

Why are coal supporters so keen on nuclear?

 From The Guardian

I think it's because they know how long nuclear plants will take to build.  While they're being built, we will (they think) have to go on using fossil fuels.   But then I'm a bit cynical.

The Coalition didn’t do much on nuclear energy while in office. Why are they talking about it now?

Last week, the Nationals’ new leader, David Littleproud, said it was time for Australia to have a “mature” conversation about nuclear energy while his predecessor, Barnaby Joyce, called for a national moratorium to be lifted and argued nuclear power would be “really important” if the country was serious about reaching net zero emissions. [The National Party was one of the parties in the former Coalition government in Australia which is strongly in favour of coal power and against renewables]

Advocates [for nuclear] have acknowledged nuclear power is the most capital-intensive energy technology, takes the longest time to recoup on investment and has not benefited from the economies of scale experienced in solar and wind energy. Costs have increased as technology has advanced.

Despite the global push to cut greenhouse gas emissions, the large-scale nuclear energy industry is going backwards. More units closed than opened in 2020. Construction began on only five reactors; four of those were in China, which is investing in all energy types. Excluding China, global nuclear generation is at its lowest level in 27 years.

The few major plants under construction in developed democracies have suffered years of delays and cost blowouts. In the UK, the Hinkley Point C station – the country’s first new nuclear plant in decades – is running 10 years behind schedule and is expected to cost at least A$45bn, nearly 50% more than initially expected. [The Vogtle 3 and 4 reactors in Georgia, USA, have more than doubled in cost and still aren't completed] 

What about SMRs?

At this point they barely exist.

SMRs are proposed to be 60 and about 200 megawatts, a fraction of the size of the traditional nuclear plant. Proponents say they would employ similar technology used in nuclear-powered submarines and icebreakers and would be easier to keep safe than bigger plants.

But a report by the World Nuclear Industry last year found talk and media coverage about SMRs was “not reflected by any major industrial achievements on the ground”.

It said SMRs in China and Argentina had been beset by delays. There had been no concrete steps towards construction anywhere else except Russia – which is pursuing a model that barely qualifies as an SMR, is years behind schedule and does not have the regulatory process expected in developed countries.

In South Korea, an SMR model was approved in 2012 but there had been no orders because it costs too much. Plans in the US had stalled; a government-backed model by the company NuScale was approved by the safety regulator, but the design was later changed and several municipalities dropped plans to host them. Backers agree that no reactors are expected before 2029 at the earliest.

The industry report concluded there was growing evidence that “SMRs, like large reactors, will continue to be subject to delays and cost overruns and the high likelihood that they would not be economical even under the most favourable circumstances”.

Is nuclear power needed in Australia?

It is a different story in some other countries, but there are plenty of analyses that say nuclear isn’t necessary here given the range of available energy options.

For example, the Australian Energy Market Operator’s integrated system plan – a blueprint for an optimal future grid – lays out a vision under which the country would run overwhelmingly on solar and wind, supported by better transmission links and backed by “firm” capacity that can be called on when needed: batteries, pumped hydro, some gas (at least initially) and demand management.

Cost is the key issue. While estimates are difficult, CSIRO’s latest analysis of different energy costs suggested SMRs would be far more expensive than solar and wind energy and at least as expensive as fossil fuel power with carbon capture and storage, which has not proven economically viable.

Why does the case for nuclear energy persist?

There is an assumption by some people, including Coalition MPs [the coal-supporting party in Australia], that renewable energy cannot do the job, despite the expert advice that says otherwise. These critiques rarely address that advice head on.

But there is also a long history of nuclear energy being used as a delaying tactic for acting on climate change in Australia, including by fossil fuel interests.

It is possible SMRs could play a role globally beyond 2030, but anyone arguing for them in Australia should be asked why they disagree with the nuclear advocates who say otherwise – and why [their] efforts aren’t better directed into backing zero-emissions technologies that are affordable and available now.