A study from the anti-coal group CoalSwarm shows a sharp drop-off in planned new coal plants around the world. The so-called “coal plant pipeline” describes the amount of coal power capacity in the planning stage (read: pre-construction), and according to CoalSwarm’s tracker, it’s falling dramatically in 2016. Reuters reports:
Overall, the amount of coal-fired generating capacity in pre-construction planning fell 14 percent to an estimated 932 gigawatts (GW) in July from 1,090 GW at the start of the year, [the study] said. The overall decline, of 158 GW, was almost equal to the coal generating capacity of the European Union, at 162 GW, it said.
Nearly all of this decline in planned coal plants is occurring in two Asian countries: China and India. Greens are attributing this trend to a rising environmental consciousness in the two countries, as Reuters encapsulates:
Ben Caldecott, director of the Sustainable Finance Programme at the University of Oxford’s Smith School, said factors such as cheaper renewable energies and worries about climate change, pollution and water stress were causing cancellations. “This trend will accelerate over time,” he wrote in a comment on the report. […]
“It’s a combination of environmental concerns, including climate and health, along with the deteriorating economics of coal,” Ted Nace, director of CoalSwarm, told Reuters of the causes for the decline.
That reading of this power shift isn’t exactly wrong, but it does fail to get to the root of what is happening. It’s no secret that coal is a dirty power source: It’s the most environmentally damaging major energy resource the world consumes, both in terms of local air pollutants and greenhouse gas emissions. Both India and China have struggled mightily to cope with the deadly smog their coal-fired plants are belching out, and the fall in planned coal projects in the two countries reflects a desire to clear their cities’ toxic skies.
But this transition isn’t about any deep love for the planet or a desire to stave off climate change—it’s about saving millions of lives and billions of dollars by combatting air pollution at the local level. More to the point, it wouldn’t be possible without cheap, plentiful alternatives. After all, coal didn’t achieve its sizable share of power mixes around the world by dint of its pleasant smell, but rather because for decades it was one of the cheapest available options.
Now, however, natural gas is beating coal in the race to the bottom of energy prices. Thanks to the U.S. shale boom and significant increases in LNG exports from countries like Qatar and Australia, natural gas is plentiful and, more importantly, cheap. Nowhere is that more evident than in Asia, which has endured a long history of paying a premium for LNG as compared to other regional hubs. But a global gas glut has sent Asian prices to all-time lows this year, and in so doing has enabled both China and India to move away from much dirtier coal.
Just about any fall in coal production is bound to be good for the environment, but as much as greens will be loathe to do it, let’s give credit where credit is due: natural gas (and fracking!) is precipitating this transition.