Head of IEA and coal analyst discuss coal's decline during lockdown due to excess supply switching off coal plants, while India embraces cheaper renewable energy. Discussion on China's ongoing coal projects. Professor explains coal's role in Industrial Revolution.
Renewable energy is now economically competitive with coal, especially in countries like India.
Countries like China continue to invest in coal despite renewable energy proving to be cost-effective and sustainable.
Deep dives
Impact of Covid-19 on Coal Industry
The coronavirus pandemic has significantly impacted the global energy demands, revealing vulnerabilities in the coal industry. With a major decline in energy consumption, some believe that renewable energy has now become a more economically viable option compared to coal. Renewable energy sources like wind, solar, and hydropower are proving to be cost-effective alternatives, providing power as cheap as or even cheaper than coal, especially in countries like India.
Transition to Renewable Energy
The transition to renewable energy sources signals a shift away from coal dependency, with coal-fired power stations facing challenges due to increased costs and environmental concerns. The decline in coal consumption is evident in countries like the UK and the US, where renewables are surpassing coal in electricity production. The flexibility and cost efficiency of renewables are attracting investment and government support, leading to a potential decline in the coal industry.
Global Energy Trends and Future Investments
The pandemic-induced decrease in global energy demand has highlighted the economic advantages of renewables over fossil fuels. Countries like China, a major coal consumer, are still planning significant investments in coal capacity despite the growing momentum towards renewable energy. While coal remains cheaper initially, the long-term sustainability and environmental impacts are prompting discussions on the future role of coal in the energy sector, especially in the context of climate change mitigation efforts.
Coal has suffered the brunt of the huge slump in electricity demand as the world has gone into lockdown. It has highlighted the fossil fuel's Achilles Heel: When there is too much supply on the grid, it's coal-fired power stations that get switched off, not solar or wind.
Justin Rowlatt speaks to the head of the International Energy Agency Fatih Birol, as well as analysts covering the two countries most central to coal's future. Delhi-based Sunil Dahiya says that India is already reckoning with renewable energy that is cheaper 24/7 than the cost of operating its existing coal fleet. Meanwhile Shirley Zhang of energy analysts Wood Mackenzie says that China's plans to build new coal-fired power stations is already baked in.
Plus, Business Daily's favourite chemistry professor, Andrea Sella of University College London, explains why coal played such a central role in getting the Industrial Revolution started, with the help of an uncooperative steam engine.
Producer: Laurence Knight
(Picture: Cooling towers at the decommisioned Willington Power Station in northern England; Credit: Paul Ellis/AFP via Getty Images)
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