Though entrenched players in the industry try to make any possible improvement in carbon emissions seem both costly and painful—a nearly unbearable burden—the truth is that the fantastic cost numbers are created by both throwing in the cost of aging plants on their last legs and assumptions that fossil fuels, especially coal, will remain the cheapest solutions available far into the future. But the truth is we’re already moving down the path of improvement, because coal is being undercut by both natural gas and renewables.
The reports mark a shift in sentiment from six months ago, when environmentalists warned governments were doing too little to carry out the Paris climate accord. Signed by 170 countries, it calls for holding global temperature increases to no more than 2 degrees centigrade (3.6 degrees Fahrenheit) in hopes of preventing sea level rise and other drastic change.
China, the biggest greenhouse gas emitter, said then that its coal use would rise until 2030. But later data showed the peak passed in 2013 and consumption is falling.
That change in the Chinese market is a major blow to US and Australian producers, who counted on a growing market to generate export sales. Australian mines in particular have high production costs, and without a ready market in China have both too much production and too high a cost for their home market. Sales are still increasing in some countries, such as Indonesia, but those don’t begin to match the lost tonnage to China.
The report said the amount of new capacity starting construction was down 62% in 2016 on the year before, and work was frozen at more than a hundred sites in China and India.
The argument from coal producers has long been that poor and emerging nations had no choice but to embrace coal, and failure to build coal plants meant being mired in “energy poverty.” But that argument is losing force in the face of a shifting market.
“Markets are demanding clean energy, and no amount of rhetoric from Donald Trump will be able to stop the fall of coal in the US and across the globe,” said Nicole Ghio, senior campaigner at the Sierra Club, a US-based NGO which has managed to force many US coal plants to close over the last decade.
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