Why we hate clean coal

Coal consumption is doomed to continue to increase dramatically in Asia, and generally worldwide. But there’s some method in the madness of greenies' opposition to clean coal.

A few weeks ago I found myself in an argument with a person heavily engaged in trying to progress technology related to use of coal with carbon capture and storage, commonly referred to as clean coal. He felt that I had put too much focus on the prospects for renewable energy and had not put enough emphasis on clean coal.

He told me that the amount of attention I was focusing on renewables was fruitless because it was simply playing at edges, focusing on a solution that might address 10 to 20 per cent of power generation while ignoring the remaining 80 to 90 per cent that needed something more reliable than wind or solar.

Why be so negative about construction of new coal power stations, he asked. New coal power stations would have 30 per cent less emissions than current coal power stations, delivering relatively cheap and quick abatement. At the same time they would be easier to fit with carbon capture and storage later because of the lower quantity of emissions requiring capture, and the higher fuel efficiency of the plants.

For people like him, environmentalists’ trenchant opposition to coal must come as totally bizarre and out of touch with reality.

For example, between 2001 and 2011 the growth in global consumption of coal as a primary energy source grew by almost as much as every other fuel combined, including oil. And advocates of clean coal will quickly point out that according to the International Energy Agency, coal will continue to grow into the future displacing oil as the biggest source of primary energy globally by 2025. And while renewables might be experiencing rapid growth, the amount of extra generation from coal and gas out to 2035 will still be greater than the growth in generation from renewables.

Surely this means “CCS is not an optional technology if we’re to address climate change”, as Gareth Lloyd of the Global CCS Institute put it to The New York Times.

When I look at the incredible growth in electricity demand expected in both China and India and how much is planned to come from coal (Coal set to burn past global oil, October 15), I’m inclined to agree with Gareth Lloyd. There is just so much new coal and gas generating capacity that has been installed or will be over the next decade that if we could affordably retrofit it with carbon capture and storage it would represent an outstanding breakthrough for climate change.

But there’s some highly logical method in the madness of greenies' opposition to clean coal.

The first thing to recognise is that many passionate environmentalists often tend to look at the world asking not what is, and what seems most likely, but rather asking what should be, and is it physically possible.

And, indeed, while the IEA forecasts that our current path is towards continued growth and dominance of coal, they don’t say this is the only path nor the most desirable. In fact, when they look at the most economically cost effective path to give us roughly a 50-50 chance of keeping the global temperature rise below 2 degrees, they see renewables displacing fossil fuels as the largest source of electricity generation.

Another thing about environmentalists is that they also look with a very sceptical and suspicious eye towards those promising quick fixes in the future while suggesting this negates the need to implement fixes available right now. 

You see, coal is the most carbon-intensive source of power by a country mile, even with the latest gee-whiz energy-efficient plant. At best we might be talking a fraction just under 0.8 tonnes of CO2 per megawatt-hour of electricity. An environmentalist asks why would I be comfortable with one of these being built that will last 40 years, when to avoid dangerous climate change I need to progress to 0.1 to 0.2 tonnes of CO2 per MWh within that same timeframe. Sure it might be able to capture its emissions in the future to achieve such a target, but I’ve got technologies that can achieve that now. At the very least we could build a gas combined cycle plant at 0.4 tonnes of CO2, and that too could capture its emissions if CCS comes off.

And what if CCS happens to be really expensive, they ask. Is the owner of this relatively young coal plant going to just happily stand by as the government ups its emission reduction targets which mean his power plant has its life cut short by 20 years? No, they think he’ll fight tooth and nail using every dirty trick in the book to stop and delay such a policy. 

The cold reality is that while clean coal advocates like to position themselves as the real deal, big daddy solution to cleaning up power supply, they are several tens of gigawatts behind those apparently dinky, playing at the edges renewable technologies other than good ol’ hydro. Back at the height of clean coal enthusiasm in 2004 when solar PV was considered a waste of time, it had only just managed to install a gigawatt within a year. Nearly a decade on and the clean coal guys are still talking about building their first commercial coal power plant that captures most of its emissions. In addition, the Global CCS Institute’s latest status report on CCS projects found that the number in the development pipeline had dropped from 75 down to 65 (Carbon capture slowing: study, October 11).

Meanwhile, the solar PV industry will install over 30 gigawatts this year and is likely to produce 45 gigawatts next year. Wind power installed nearly 45GW last year.

Is this enough to solve the problem – nope. But greenies ask is there anything physically stopping them from building an awful lot more – and the answer is an emphatic no. And the amount of solar and wind energy accessible around the globe could power the world many times over.

But what about reliability of power? Again the greenies ask what is physically possible – let’s look at actual weather and electricity demand patterns. Out of that they find the task is challenging and costly but not impossible. What’s more by the time wind and solar start to reach levels that become challenging in a decade or two, it seems reasonable to expect substantial progress with energy storage technology is possible, too.

Now, I personally still think that given the considerable growth in electricity demand from China and India likely to be produced from coal, environmentalists should be strong supporters of carbon capture and storage. But they would be stupid to see it justifying the status quo in Australia.

InvestSMART FORUM: Come and meet the team

We're loading up the van and going on tour from April to June, with events on the NSW central & north coast, the QLD mid-north coast and in Perth, Adelaide, Melbourne, Sydney and Canberra. Come and meet the team and take home simple strategies that you can use to build an investment portfolio to weather any storm. Book your spot here.

Want access to our latest research and new buy ideas?

Start a free 15 day trial and gain access to our research, recommendations and market-beating model portfolios.

Sign up for free

Related Articles