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The early end of British coal

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In its heyday, the British coal industry produced more than 280 million tons a year.  Today, what remains produces less than 9 million tons – less than was produced at the height of the 1984-85 miners’ strike.  Since then, demand has fallen steadily as industrial users either closed or used alternative fuels.  More recently, the switch to combined cycle gas turbine power stations has steadily lowered the amount of coal needed to provide Britain’s electricity.

The big killer for coal, however, turns out to have been then-Energy Secretary Amber Rudd’s announcement that all UK coal power stations would cease operations by 2025.  That is still eight years away, of course.  But when you tell a commercial company that its capital is going to be worthless in just a few years’ time, you can hardly expect them to continue to invest in it.  Several large coal power stations have closed much earlier than was expected.  Some have been demolished; a few have been cannibalised for spare parts.  Others have been ‘mothballed’ for use in an emergency.  But, in the absence of a reversal of policy, nobody is going to be opening a new coal power station or making major repairs to an existing one.

The death of coal-fired electricity can be seen in the latest government statistics.  Compared to the same quarter last year, coal burned in UK power stations has fallen by 65 percent.  This has also had a noticeable impact on UK coal production, which fell by 28 percent.

None of this is cause for regret.  As Dieter Helm, the Government’s energy policy reviewer has said:

“Coal is terrible stuff. Coal mines emit methane, they pollute the water table, they impair the health of anyone who goes in a mine, Coal is heavy to transport, and when it is burned it emits a cocktail of pollutants, water is needed for cooling, and then there is the waste to get rid of. It makes fracking gas look benign. There are therefore multiple environmental reasons for getting out of coal as a first priority.”

Regions like South Wales may lament the economic devastation that came with the death of coal.  But nobody seriously wants a return to the work conditions of deep mining, still less the pollution that caused our rivers to run black and our air to be thick with coal dust.

Further afield, the death of coal has been hailed as a triumph of ‘green energy.’  There is a grain of truth in this.  The same government data shows an increase in what they choose to call “low carbon” electricity, within which, wind (both onshore and offshore) experienced a considerable (50% and 22% respectively) increase on the same quarter in 2016.

Nevertheless, gas is the real winner from the demise of coal, accounting for 41 percent of electricity generation.  Nuclear saw a 7 percent increase to take its share of total electricity to 24 percent.  ‘Renewables’ made up 30 percent of UK electricity.  However, environmentally questionable wood and waste burning accounts for 36 percent of renewable generation.  Wind now accounts for a respectable 43 percent of renewables, while solar pv accounts for just 17 percent (over its most productive summer quarter).  In addition, the UK imported 5.24 TWh (7%) of its electricity via interconnectors with European partners.

Clearly the summer of 2017 has proved to be a particularly bountiful period for wind energy.  However, Britain is a long way from weaning itself of fossil fuels.  And therein lies a potential problem.  Additional nuclear capacity is unlikely to be available until the late 2020s, while gas generation capacity has expanded more slowly than projected.  In part, this is due to investor scepticism about the volumes of recoverable and profitable shale gas beneath the British Isles.  Domestic conventional gas production is insufficient, and imports from Qatar and Russia cannot be relied upon (a problem made far worse by the closure of the Rough storage facility).  Couple that to the rapidity with which coal plants have closed, and we have a recipe for eye-wateringly high prices at best, and widespread power cuts at worse.

 We had better hope that our European neighbours continue to sell us their spare electricity while the government negotiates an amicable exit from the European Union.

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