0

0

0

0

0

0

0

0

0

London Eye: Private sector shapes Glasgow deal

Mini

India's private sector is moving away from coal much faster, the report suggests. Since 2015 "India has seen over 326 GW of projects cancelled".

London Eye: Private sector shapes Glasgow deal
The final Glasgow compromise, after some draft compromises along the way, had India watering down the agreement on coal as a source of power. But if India still conceded on coal as much as it did, its hand was forced by its own private sector.
India forced an elegant twist of phrase in the final draft from "phasing out" coal to "phasing down coal". Twelve days of talks that stretched into a 13th was finally and in essence a movement India forced with support from China for once, and also South Africa, from one phrase to the other.
Just how much coal can be phased down rather than out was beyond the overstretched Glasgow meet to explore. But the conference agreed in the least not to leave it at that. The question will be confronted as early as next year at a follow-up conference in Cairo.
The single most important outcome of the Glasgow summit was that there will now be another summit. And then another year after year. Glasgow will be the summit where pressure begins to build to do more, in a way that the earlier climate summits in Kyoto, Copenhagen and Paris failed to do.
Coal imports
Globally it is estimated that in order to contain the rise in the temperature of the earth to no more than 1.5 degrees this century as intended, about 80 percent of all production will have to shut down as early as 2030. Upwards of 60 percent of all electricity production in India comes from coal, and of this 80 percent is state-owned.
That production is being hit severely by market forces. Demand for power has risen sharply over recent weeks driven by a burst of expansion after the end of the Covid-induced lockdown. But the import of coal has fallen in recent weeks under the pressure of an estimated 40 percent rise in prices. India is the world's second-largest importer of coal.
Between April and September, India's coal imports rose 13 percent, according to a report by mjunction, a joint venture of Tata Steel and the Steel Authority of India. But in September of this year, the imports were down about 22 percent over September 2020, to 14.85 million tonnes from 19.04 million tonnes.
Coal production and export have been under pressure just about everywhere under the pressure of a rethink on coal. That pressure appears to have persuaded producers already that they are in a business that has no future. An inevitable outcome has been a scaling down of production plans and a rise in prices.
Abandoning coal
A report produced by the climate change think tank E3G suggests that the global pipeline of proposed coal power plants has collapsed by 76 percent since the Paris agreement on climate change in 2015. Since then the report says 44 countries have committed to no new coal, and a further 40 have no projects in the pre-construction pipeline. In all 1,175 GW of planned coal-fired power projects have been cancelled since 2015, it says.
Currently six countries – China, India, Vietnam, Indonesia, Turkey, and Bangladesh – account for more than four-fifths of the remaining pre-construction pipeline. The report speaks of Pakistan, Malaysia, and Sri Lanka as “regional pathfinders” in moving away from coal.
South Asia has a pre-construction pipeline of 37.4GW, with India's 21GW pipeline accounting for 56 percent of this, the report says. India has a current capacity of 233 GW, 11 percent of the world's total. China has about four times as much.
State governments in India are moving faster away from coal than the national government, the report says. Between 2019 and 2021, "public officials from four Indian states – Gujarat, Chhattisgarh, Maharashtra and Karnataka – announced their intention to not build new coal plants".
India's private sector is moving away from coal much faster, the report suggests. Since 2015 "India has seen over 326 GW of projects cancelled," so that 7GW have been scrapped for every 1GW that has gone into operation.
Much of this abandonment has come from the private sector. “Most private developers have little appetite for coal and are instead pivoting to renewables, making it increasingly hard to fund new coal projects," the report says.
India cannot move away from coal at the speed that was expected of it in Glasgow, and India built that decision into the final outcome. But in agreeing at the least to phasing down coal, the government has been influenced substantially by rising costs for its public sector production, and by the drying out of private investment in coal.
next story