Jude Clemente: ‘King Coal’ Roars Back
Forbes, 27 October 2021
Although the COP26 virtuous don’t want you to know it, rebounding economies and the ongoing global energy crisis have vaulted much-maligned coal to the top of the energy food chain, once again.
President Biden’s energy-climate policies have apparently been more friendly to coal than those of President Trump.
New federal data has U.S. coal-fired power generation leaping 22% in 2021 to 945 terawatt-hours – the first annual increase for coal since 2014.
Coal will generate nearly a quarter of U.S. electricity this year, with competitor natural gas prices doubling since June to over $6.00.
The demand boom has U.S. coal companies now offering miners six-figure salaries.
Not too shabby for a commodity that the media has loved to leave for dead for well over a decade now.
“Coal’s burnout,” The Washington Post declared on January 2, 2011.
Personal politics permeating “journalism” continues to leave us energy-climate stupid.
And with President Xi Jinping not expected to attend the upcoming COP26 climate summit, the world’s top consumer is hardly “getting off coal.”
Adding a whopping 38,400 MW, China built more new coal generation capacity last year than the rest of the world retired.
In addition, after decades of trying to “get off coal,” even small-growth Europe is realizing what happens when the real alternative becomes unaffordable: “Coal Is Making A Comeback In Europe As Gas Prices Explode.”
Yet, the rebound in coal is not surprising when we look at the numbers.
Only ~20% of global coal usage is internationally traded, making coal a largely domestic resource with huge energy security advantages for consumers.
By comparison, ~33% of gas and ~75% of oil are swapped from country to country.
Coal is a foundational resource in all-important Asia, so demand typically grows as the population and economy expand.
Globally, coal is still easily the main source of electricity at 37-40% of all generation.
Coal accounts for 60-65% of the electricity generation in China and 68-73% in India – the two most significant incremental energy users that hold ~35% of humanity.
Coal demand has been so high in China this year that supply shortages have forced electricity to be rationed, with “alternatives” to coal not quite as available as some like to insist.
In the most energy-deprived nation on Earth, booming coal demand in India has also left the country short of supply: “Without coal, you cannot survive…It’s not possible to keep the lights on without coal.”
With 85% of the global population struggling in the still developing countries, the United Nations has affirmed that human progress trumps all:
“Economic and social development and poverty eradication are the first and overriding priorities of the developing countries,” United Nations
The private jet-setters at COP26 will just have to get over that.
In fact, the United Nations has been telling us that today’s humans come first since 1972.
And I doubt very highly that the American taxpayers want tens of billions of their dollars going into some ambiguous, and surely untrackable, global “climate fund.”
Sorry, but I choose our precious resources to go to educational equity and economic opportunity for the poor and neglected Black neighborhoods of Homewood in Pittsburgh and Adamsville in Atlanta…..not for windmills in India.
The American voting public deserves and should be demanding that.
Even in rich Japan, which is a fully developed country with a declining population rate, there’s no timeframe to phase out coal.
In 2030, coal is slated to hold 20% of Japan’s power mix.
In Germany? Hundreds of billions of dollars spent on renewables still has left coal as the main power source.
Not just for electricity (the sine qua non of modernity), coal is the backbone of steel production and thus the enabling force of cities.
Most ironically of all then, coal for electricity and steel make it integral to the construction of windmills and solar panels themselves.
A reality check from the The Wall Street Journal in July: “Behind the Rise of U.S. Solar Power, a Mountain of Chinese Coal.”
The steady drumbeat of global urbanization adds some 70 million people every year to the world’s cities – a Texas and California worth of humans having more money and more access for more energy consumption.
The world’s energy and electricity consumption is set to explode exponentially in the decades ahead.
For most of these new high consumers, “electrification” (e.g., electric cars), bridging the “digital divide,” and soaring air conditioning surely means much more electricity and that means coal.
Crazy high oil and gas prices should give coal a leg up this frigid winter.
For example, coal accounts for 80% of China’s heating.
The typical energy market choice is between coal, oil, and gas, with naturally intermittent renewables stuck in the minor leagues.
And unlike what we keep hearing, costs for renewables aren’t declining in perpetuity.
S&P Global, for instance, reports that a “host of headwinds” are driving a 15% surge in U.S. solar prices this year and a 19% jump for wind.
The mounting costs for renewables is based on rising demand, which could easily get worse as the “energy transition” marches on.
And cost comparisons between coal and renewables are not accepted globally as much as Western academia now claims.
Sheer physics make wind and solar “non-dispatchable” sources of electricity, and their faculty to displace “dispatchable” resources like coal is not as strong as advertised.
This huge difference in reliability makes the “renewables versus fossil fuels and nuclear” debate an apples to oranges comparison.
Coal might just become cheaper than ever because of the focus on other sources of energy – freeing it up to be utilized more than currently forecast.
With COP26 just days away, and especially since electricity is only becoming more important in our lives, we must be realistic.
And seeking only weather-dependent energy is about as unrealistic as it gets.
Ultimately, the energy crunch is likely to make coal even more important in the eyes of major users: it reaffirms that all resources – especially the most essential ones – must remain as viable options to support a human progress that continues to fall unacceptably short.
Indeed, “for energy, poor people deserve to be rich.”
If we aren’t careful, the poorer coal-based economies will just simply turn to cheaper and less efficient coal, such as subcritical plants.
This explains why the International Energy Agency for so many years has been strongly advocating for supercritical and ultra-supercritical technologies, along with huge investments in carbon capture and storage (CCS).
Our OECD energy advisor has already told us that “combined with CCS, HELE [High-Efficiency, Low-Emissions] technologies can cut CO2 emissions from coal-fired power generation plants by as much as 90%.”
Coal is so ingrained in the world’s gigantic energy complex that significantly reduced emissions and net-zero are a pipe dream without these clean coal technologies.
We’re already seeing the devastating consequences of not investing in the critical energy resources that so many want us to think will all just be magically going away.
And I horrifically expect the resulting extremely high prices to be deadly this winter.