Skyward Oil Stokes a Coal-Fired Future
NEIL REYNOLDS, Globe and Mail Update, July 18, 2008 at 6:00 AM EDT
Der Spiegel, the German newsmagazine, explained earlier this month why the Persian Gulf states are switching to coal. “[They] may be sitting atop massive oil reserves,” the magazine said. “But with prices for crude skyrocketing, it makes more sense to sell it than to use it. Instead, the Gulf states are turning to coal for their own energy needs – to the detriment of the climate.” And these states are not alone. “Demand for coal plants,” the magazine says, “is growing rapidly across the globe.”
Abu Dhabi (largest of the seven UAE emirates) has announced that it will switch to coal-fired power plants. Dubai (the second largest) is already building four of them – with a combined output of 4,000 megawatts – as a first-phase investment in coal. Apart from the United Arab Emirates, Oman (widely regarded as “the next Dubai”) has signed a contract with South Korea for the construction of several coal-fired plants. Beyond the Gulf, Egypt proposes to build its first coal-fired plant on the shores of the Red Sea. Russia has announced plans to build more than 30 coal-fired plants by 2011.
As almost everyone now knows, China connects a new coal-fired plant to its electrical grid every 10 days – and intends to keep doing so for several years. Less known is China's decision to construct a massive coal-fired plant in Inner Mongolia that will convert the region's vast coal reserves into oil. With 10,000 people now engaged in the construction, the plant will be completed by the end of the year. The coal-to-liquid process used by this plant will consume twice as much coal and produce twice the CO{-2} emissions as the simple burning of coal in a conventional power plant.
The Kyoto Protocol, incidentally, classifies the Gulf states as developing countries – meaning that they are under no obligation, oil revenues notwithstanding, to reduce CO{-2} emissions. They have opted for coal for a single compelling reason: cost. They can produce a megawatt-hour of electricity using Australian coal, Der Spiegel calculates, for $17.49 (U.S.). Using natural gas, the cost rises to $41.34. Using oil, the cost rises further to $79.50. At the same time, they can sell their oil on the global market for something approaching (or occasionally exceeding) $140 a barrel.
One of the ironic differences between Germany and the Gulf states, Der Spiegel observes, is the absence of solar energy investment “in the sun-baked Gulf states.” Germany produced 1,300 megawatts from solar installations in 2007; the Gulf states combined produced 36 megawatts. As impressive as its commitment to solar power appears, though, Germany has its work cut out. It has promised to generate most of its electricity by renewable energies (largely wind and solar) by 2020 – when it will phase out its nuclear power. Germany has thus opted for the world's most expensive electrical power even as other countries simultaneously opt for the cheapest.
For an assessment of Germany's chances, check out CanadianEnergyIssues.com, the website of Steve Aplin, the perceptive Ottawa-based energy and environment consultant. “Germany must bring at least 12,000 megawatts of base-load electricity into service by 2020, the year in which the nuclear phase-out will begin,” Mr. Aplin writes. “German politicians are beginning to realize the difficulty, if not the impossibility, of plugging the gap left by the departure of nuclear.”
It appears that German environmentalists are making it harder for the country to reach its aggressive objective – and are driving up the country's CO{-2} emissions, too. Some German Greens are blocking construction of power lines needed to connect wind power to the grid in a bid to prevent despoiling of the countryside. Mr. Aplin notes that emissions from German power generation rose by 12 million tonnes between 2005 and 2007. “In their zeal to admonish the rest of the world,” he says, “German Greens are making sure that their own emissions will continue to rise.”
Other German Greens are championing – you are ready for this, right? – coal. “The more strident of the anti-nuclear politicians in Germany are now advocating new coal and gas plants to ward off a certain electricity supply crisis,” Mr. Aplin says. “Why is coal in this mix? It is cheap and domestically available.”
Cheap, reliable power apparently still has its practical uses – and its political appeal. The Germans are now operating a showcase 40-megawatt solar power plant near Leipzig (which, in its experimental startup phase, will operate as a 24-megawatt plant). But 40 megawatts are a long way from 12,000 megawatts. “Hence,” Mr. Aplin says, “the new enthusiasm [in Germany] for coal and gas.”
The bizarre debate still rages on here and there in the developed countries. What limits on carbon emissions must be imposed? What taxes levied? Two days ago, though, Germany's Finance Ministry issued a remarkably candid public statement. It conceded that Europe's proposals for reductions in greenhouse gases – without the participation of all major contributors worldwide – will be pointless.
Precisely.
AI
