Under a dark cloud - the future of coal

By Prof. Derek Taylor, Former Energy Advisor to the European Commission

Coal plays an important and often an essential role in energy policy in many countries throughout the world. Its importance in the industrial development of our planet cannot be over estimated.  It could continue, because of its wide distribution and very extensive reserves, to assure our security of energy supply for far into the future and, because of its relatively low cost, through times of economic recession. It presently produces close to 30% of the European Union’s (EU’s) electricity and over 40% of all the electricity produced in the world. The future of coal would seem to be very bright but for one thing – the negative impact on the environment that results from its use, in particular its role in climate change.

Burning coal – like burning any fossil fuel – results in substantial emissions of carbon dioxide (CO₂). The Member States of the EU have agreed to reduce their CO₂ emissions by 40% by 2030 and by 85-90% by 2050. These targets are strongly supported by the UK government and others. Specifically for the power sector, the emission reduction by 2050 would be between 93% and 98%. These reductions are expected to be achieved partly by increasing energy efficiency and also by increasing the deployment of low carbon technologies - renewables (mainly wind and solar) and, in some countries, nuclear power.

At present, the main driver aimed at bringing about the necessary technology changes in Europe is the emission trading system (ETS). This is a “cap and trade” instrument for CO₂ emissions, with a steadily lowering cap. This, in turn, should increase the cost of carbon emissions and result in increasing the cost of producing electricity from CO₂ emitting fuels. Political leaders have clearly stated that coal has no future in energy supply in Europe unless it can reduce its emissions to near zero. The EU’s climate and energy policy has potentially dramatic consequences for coal producers.

On the other hand, there is still very strong reluctance to move away from the traditional large sources of electricity – in particular those that can produce electricity 24 hours a day 365 days a year. While some EU Member States have a relatively small dependence on coal for their electricity, in the UK it is close to the European average at around 30%, others have a high dependence. In Poland, for example, up to 85% of electricity is produced from coal. In addition, several Member States have a relatively low potential for renewable energies or are very reluctant or unable to meet their significantly higher costs.

 

Historically, of course, the use of coal in many European countries increased our energy security as it was mined in many of the countries. However, domestic producers of hard coal – as opposed to brown coal or lignite – can no longer compete with overseas producers and the majority of coal mines have closed in Europe. We now import over 60% of our hard coal, with Russia being our main supplier with its exports to the EU increasing five-fold in the last 15 years.

In spite of this increased dependency, it is clear to most students of energy policy that, because of its continuing availability and economic advantages, we cannot and will not stop burning coal at least for many more decades. So efforts are being made to reduce the climate impact of continuing coal use.  By far the greatest effort is being targeted at carbon capture and storage (CCS) – not only in the EU, but also in many other countries including Australia, Canada, China, Norway and the USA.

While simple in concept, CCS is only now being demonstrated on an industrial scale (in North America) and, indeed, still faces many challenges including lack of regulatory frameworks, need for technology development and lack of the necessary funds. Moreover, in some countries, proposed demonstrations are running into problems of public acceptance and/or difficulties in identifying the geological environments in which to store the carbon. While millions of tons of CO2 have already been stored – in particular in the Norwegian sector of the North Sea and at various sites in North America – efforts are still required to increase the confidence of many stakeholders in the technology.

Expanding the number of pilot projects, such as the Geo-Energy Research Centre (GERC) site, aimed at improving our knowledge of measuring and monitoring how carbon dioxide behaves in different potential storage sites is a very important step for the further development of the technology and increased consumer confidence. However, more full scale demonstrations of CCS followed by rapid deployment will be vital if we are to continue to burn any fossil fuel to produce electricity in the medium to longer term. But for coal there will be no longer term future if we do not deploy CCS very quickly.

Derek recently gave a lecture on the future of coal as part of our GERC Invited Lecture Series.
If you missed it you can watch it again on our GERC YouTube channel.

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