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More Than 40 Percent of World Coal Plants Are Unprofitable, Says Report (reuters.com)
An anonymous reader quotes a report from Reuters: More than 40 percent of the world's coal plants are operating at a loss due to high fuel costs and that proportion could to rise to nearly 75 percent by 2040, a report by environmental think-tank Carbon Tracker showed on Friday. London-based Carbon Tracker analyzed the profitability of 6,685 coal plants around the world, representing 95 percent of operating capacity and 90 percent of capacity under construction. It found that 42 percent of global coal capacity is already unprofitable. From 2019 onwards, it expects falling renewable energy costs, air pollution regulations and carbon pricing to result in further cost pressures and make around 72 percent of the fleet cashflow negative by 2040. In addition, by 2030, new wind and solar will be cheaper than continuing to operate 96 percent of today's existing and planned coal plants, the report said.
Hopefully this will lead to increased adoption of cleaner power production - that is not so bad for the environment.
I agree. When I was younger I spent lots of time outdoors. Preserving the natural beauty of the world should be something humanity strives to do.
I am not saying that all clean power is cheaper but the more of it that gets used the cheaper that it will become.
I think what was happened is that we have reached the "tipping point" where clean energy is actually competitive in the marketplace. Interestingly, all the various governments around the world that have pushed for clean energy production have varying economic and regulatory philosophies (as evidenced by the various approaches to regulation of dirty power and economic incentives/penalties for varies participants in the energy market), but the end result has been the same: for the longest time it just looked like a money pit, and now we start to see some large scale benefit.
I think that a solution based on market forces (i.e, people doing what benefits them economically) will always be stronger, healthier, and more effective than one based on regulatory forces. Granted, sometimes regulatory forces are required (e.g., to maintain clean air and water in the era of industrial production and dirty power), but those are never as good as market forces because regulations mean people do what they are required to do (and people will try to find ways to avoid meeting the requirements) while market forces mean people act in their own best interests.
Even that is only half of the truth. The other half is how much of Western world started treating electric generation vs consumption. On many spot markets, wind and solar get "first dibs", in that no one else gets to sell their generation until all of wind and solar are sold. This is followed by various power generation systems that are ranked in order of CO2 emissions. That means coal lands on the bottom, and is legally forbidden from selling when others are producing enough to cover the consumption.
Hence the lack of profitability. When you plant takes many hours to spin up or spin down, and you can't sell much of what you produce because you're forbidden from doing so even if you can sell at prices lower than competition, you're going to go into red very quickly.
That's why CCGTs are popping up. They can spin up and take load much faster, so when wind drops out of the grid, they can pick up the load and get paid premium for peaking, and they can also economically produce during longer periods of higher consumption. Add to that the unique situation in North America where fracking is producing massive amounts of natgas that is essentially free as a byproduct of oil extraction, and you have a situation where in developed countries, coal is really struggling.
But go outside developed countries, without the rules for punishing coal and subsidizing wind and solar, and situation reverses completely. Unlike natgas, biomass and other coal replacements in developed countries coal is inherently very cheap to extract, transport and store. That means that in developing world, coal continues to be one of the most economical sources of power.
The only problem with coal we still can't solve is CO2 emissions per power generated. It's just too high. But developing countries overwhelmingly don't care about it. They just go with what is inherently cheap and efficient. Which is more often than not coal.