A report released at the end of March shows that coal had a painful 2016, while renewables and natural gas are on the rise. The report, titled Boom and Bust 2017, was put out by team of environmental groups including CoalSwarm, Sierra Club, and Greenpeace. They have examined worldwide coal-generation capacity, plus planned capacity, and found that coal use has been reduced enough to make it feasible for the climate to warm less than 2 degrees Celsius from preindustrial levels, which is a key benchmark for the environmental community.
The report says that coal generation capacity experienced an unprecedented expansion in the years leading up to 2016, but then China and India led a dramatic turnaround. China’s central government put on hold more than 300 gigawatts of projects, including 55 gigawatts worth of projects that were already under construction. This policy was implemented largely because existing plants were being underutilized, but concerns about smog and desire to comply with international climate agreements also played a role.
India also slowed down development of coal projects, largely because it ran into trouble securing financing. India and China accounted for most of the world’s growth in coal power, so their reductions led to major reductions worldwide. This includes a 48 percent drop in world-wide coal pre-construction activity, 62 percent fewer construction starts, and a 19 percent reduction in ongoing construction. Meanwhile, retirements of existing plants are becoming more common in the U.S. and Europe.
There is some debate about what this all means. Environmentalists say it is evidence of the inevitable switch away from coal to renewables, but that is not entirely clear. Others would say it is merely a sign that China’s electricity demand has stopped growing rapidly, while India has also experienced some economic turbulence. Either way, it is an important trend worth watching.
Greenwave Energy provides environmentally-sustainable energy solutions for California residents. We keep an eye on national policy and industry trends to help put our mission in context and provide a resource for our customers.