India turns to King Coal again as heatwaves lead to power demand surge

Sharp jump in coal consumption likely in India, rest of the world

Business

Environment

May 16, 2022

/ By / New Delhi

India turns to King Coal again as heatwaves lead to power demand surge

In 2021, India’s total coal consumption topped 1.05 billion tonnes, up from 930 million last year (Photo: Twitter)

Though it was meant to be phased out, albeit gradually, the use of coal has only increased every year since the Paris Climate Agreement of 2015. With crude oil prices above USD 100 per barrel and frequent occurrences of unprecedented heatwaves, one can be certain that despite being highly polluting, coal consumption this year too will rise.

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Last week, Indian government said it was reviving mining from 100 coal mines that had been shut down earlier as they were not financially viable. However, with a severe coal shortage looming large over the country, leading to a massive mismatch between power demand and supply just at the time when the country experienced an unprecedented heat wave, the government was forced to reopen the mines that are expected to produce up to 100 million tonnes per year, boosting the share of coal in India’s total energy mix.

Even before it decided to reopen the mines, India had been the second largest producer, importer and consumer of coal in the world and the current shortage of coal as well as the heatwaves that seem to have become a fixture every summer, the consumption of coal seems set to rise, even though India had promised to start curbing coal and switch to cleaner fuels and renewable energy sources as per its commitment at Cop15, the Paris Climate meet in 2015.

In 2021, India’s total coal consumption topped 1.05 billion tonnes, up from 930 million the previous year. Though it is still early days in 2022, one can be certain that the coal consumption would be even higher this year.

Unfortunately, the trend of greater usage of coal is not limited to India. According to the International Energy Agency, in 2021, the global energy-related carbon emissions rose to their highest level ever of 36.3 billion tonnes. IEA cited strong recovery in the global economy as well as greater usage of coal for power generation.

Coal accounted for over 40 pc of the overall growth in global CO2 emissions in 2021, reaching an all-time high of 15.3 billion tonnes, said the IEA. It went on to say that coal production around the world was set to rise even further and reach its highest level ever in 2022.

IEA says the use of coal for power generation was intensified due to record high natural gas prices and as a result, the cost of power generation through coal in the United States and many European nations was considerably lower than through gas. The switch from gas to coal led to increase of 100 million tonnes in carbon emissions in these two regions, says IEA.

As the IEA report was released in early March, it is safe to assume that it had not taken into account the Russian invasion of Ukraine from February 26 which led to a spiral in crude oil and gas prices. Brent crude which had already risen from USD 78 on December 31 to USD 97 on the eve of Russian invasion shot up to a record USD 139 and since then has stayed about USD 110 a barrel.

For Europe, this turned out to be a double whammy as not only have the crude oil and gas prices risen significantly, but Europe is facing an unprecedented energy crisis due to the Ukraine conflict as Russia has threatened to turn the tap off on its gas supplies to Europe and has gone ahead and actually cut off supplies to some European nations.

Emerging markets feel the heat

The impact of high oil and gas prices is being felt even more severely in emerging market economies which have been hit hard by the price rise as it has fueled general inflation and made them turn to coal in an even bigger way. For instance, in India, the second largest consumer of coal in the world, the coal consumption this year is set to breach an all-time high, after having scaled a new high last year when the coal consumption jumped 8 pc to 1.05 billion tonnes.

Despite rise in renewable energy production in the country, India’s consumption of coal is set to rise every year until 2030, reaching anywhere up to 1.5 billion tonnes, nearly 50 pc more than currently, the Indian coal minister said recently.

India is not the lone nation turning to coal, though. Most emerging economies are likely to see a greater consumption of coal for their energy needs for the foreseeable future. It may also rise sharply in China, the largest consumer of coal in the world, later this year and next year once China overcomes the Covid-19 pandemic that has currently led to highly controversial and massive lockdowns.

All this is terrible news for the battle against climate change and it comes less than a month after the latest report by the Intergovernmental Panel on Climate Change that said the world continued to hurtle towards an abyss due to climate change as the global leaders continued to miss their commitments to cut carbon emissions by a wide margin. The report so enraged the UN Secretary General Antonio Guterres that he accused the leaders of simply lying on their commitments.

One can only imagine at this stage the real impact of the rise in oil and gas prices on carbon emissions this year, but it is certain to go on to record a new high, not just due to the switch to coal. As has been the trend over the past few years due to global warming and climate change, large parts of the world notably Africa and southern Asia have seen record temperatures in searing heat waves that have gripped these countries for several weeks. Indeed, India and Pakistan have seen the hottest months of March and April in well over 122 years. The unprecedented and sustained heatwaves have led to such a jump in power consumption in many parts, leading to power cuts of as many as 12 hours a day.

Most parts of India, for instance, have been experiencing blackouts as the government and utilities struggled to keep up with a record power demand amidst a severe shortage of coal.

Besides leading to higher emissions due to greater consumption of energy, the heatwaves and higher prices have impacted the climate in another manner – a switch to cheaper, dirtier coal whose usage would propel carbon emissions and air pollution even further. In many instances, power generation firms had switched to dirtier coal to save money as using imported coal would have pushed up their production costs even higher.

Not just due to higher prices for cleaner coal, the switch to cheaper, dirtier, domestic coal has happened and is accelerating due to easier availability as utilities struggled to keep adequate stocks. For instance, last week most coal-fired power plants in India reported running out of stocks, leading to power cuts.

This led the government tell the power firms to increase the share of domestic coal in their overall coal consumption as imports would have taken longer, besides being pricier.

Certainly, it is too early to even estimate the real impact of these developments on carbon emissions and climate change, but it is certainly not going to be good news at the end of the year when scientists and experts start collating data about emissions in 2022.

Unfortunately, there are no short-term solutions to avert this situation. The only thing the world can do is to pressure the government and business leaders to honour their commitments and put the money where their mouth is to invest in green energy-driven and energy efficient economies. The heatwaves are certainly to become more intense and widespread as well as prolonged over the years. The only way to save the world is go green and to go green right now.

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