Yet another annual United Nations climate summit has come and gone. This year’s climate summit saw 20 countries pledge to phase out coal usage by 2030 as part of a new international alliance to phase out coal from power generation before 2030.
The Powering Past Coal Alliance was launched in November last year. Though not legally binding, its creation was heralded as a major step in the global effort to reduce greenhouse gas emissions and keep the world within the 2° C limit—a temperature limit beyond which there may be drastic changes to the climate system.
Coal is considered to be the “dirtiest” fossil fuel, yet it remains responsible for more than 40 per cent of global CO2 emissions. Most of the world’s coal is currently used to generate electricity and heat.
Apart from pledging to phase out coal from power generation, the alliance also involves sharing technologies such as carbon capture and storage, and putting pressure on major coal consumers to reduce their use of the fuel.
Critics have rightly pointed out that in the absence of some of the world’s largest coal consumers—China, India, the United States, Germany and Russia—the current country members of the alliance account for less than 3 per cent of global coal use.
As of 12 December 2017, the alliance increased its membership to over 50 partners, a goal they had hoped to achieve by the next climate summit, which will convene in early December 2018 in Katowice, Poland.
Over the last two decades, the world has seen a shift in coal electricity production to countries with more carbon-intensive electricity systems. In fact, global CO2 emissions from electricity production have nearly doubled since 1990, in tandem with the doubling of electricity output. This “geographical shift” effect is the main culprit for the world’s dismal performance.
Essentially, emissions reduction achieved by countries switching to cleaner fuels to produce electricity have been nearly entirely offset by emerging economies.
For example, between 1990 and 2015, China’s share of global electricity production increased from 5 per cent to 24 per cent, and that for India increased from 2.5 per cent to 6 per cent. Both China and India’s electricity carbon intensities, a measure of the CO2 emissions for every unit of electricity generated, have remained above the global average due to a high share of coal consumption, despite significant improvements over the years.
Challenges for the electricity sector
Yet, even if China, India and the United States joined the global alliance to phase out coal, we would not be out of the woods.
Emerging economies will take the place of more developed countries in contributing to global CO2 emissions. In particular, Southeast Asia is set to be one of the key regions for rapid growth in energy consumption and CO2 emissions.
Developing countries face pressures from development and the need for greater electrification. With a lack of easily exploitable cleaner energy alternatives and financial resources, coal is the easy way out.
According to the International Energy Agency’s Southeast Asia Energy Outlook 2017, the region’s energy demand is expected to grow by almost two-thirds in the period to 2040. In this scenario, coal alone accounts for almost 40 per cent of the growth, and overtakes gas in the electricity mix.
With over 100 million people in the region living without electricity, meeting Southeast Asia’s electricity demands requires a large expansion of power systems.
Thus far, the trend has been to turn to coal. Between 2010 and 2015, Indonesia increased its share of coal in the electricity mix from 40 per cent to 56 per cent. It has future plans to build more coal plants as part of its “fast track” programmes. Similarly, the share of coal in the electricity mix increased from 20 per cent to 30 per cent in Vietnam in the same period and there are plans to build more as the country begins to exhaust its hydropower resources.
These trends highlight the reality that developing countries face in balancing energy needs and sustainability. Developing countries face pressures from development and the need for greater electrification. With a lack of easily exploitable cleaner energy alternatives and financial resources, coal is the easy way out.
Without sufficient international assistance, countries will continue to take the sequential path of electricity resource development. They will first exploit the dirtiest fuels with the lowest efficiency before improving power generation efficiency, switching to natural gas and finally to renewables. The world cannot wait for all countries to progress along this path.
Technological leapfrogging—will it happen?
The development of the mobile phone has enabled developing countries to skip the fixed-line technology and move directly to mobile technology. Can we similarly leapfrog to more efficient and cleaner technologies in electricity production without taking the sequential path?
There are several obstacles to overcome.
Many countries continue to face regulatory, political, infrastructural, market and technological barriers to the adoption of renewables. In particular, storage and intermittency are key impediments to the widespread adoption of wind and solar power. The integration of various market mechanisms is another area that requires greater innovation.
Furthermore, although developing countries do not have the burden of old power grid infrastructure and systems, they lack the technical and financial resources to adopt the most efficient fossil fuel plant technologies and power grid systems that can handle intermittency and allow for grid integration.
The availability and access to cleaner indigenous energy resources also varies significantly across countries. For instance, while Laos is able to harness its hydropower potential to fulfill a large portion of its electricity demand, the abundance of coal in Indonesia provides a cheap fuel that has restricted the exploration of geothermal power in the country.
Despite these challenges, there are promising signs that renewable energy is gaining a stronger foothold in the electricity sector. Renewable energy investments have reached record levels in recent years.
The share of hydropower, geothermal, solar and wind power in global electricity output has also increased steadily, from 18 per cent in 2010 to 21 per cent in 2015.
More intense cooperation among countries on many levels, from financing to technology transfer, can help to spur more rapid growth in renewable energy adoption. This will put us on the path towards a zero coal future.
Melissa Low is Research Fellow at the Energy Studies Institute, National University of Singapore. Goh Tian is a PhD candidate at the Department of Industrial Systems Engineering and Management at the National University of Singapore. This article is written exclusively for Eco-Business.