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Is the world warming to clean coal?

September 20, 2017

By Paul Homewood




A thoughtful article from CAPX:




At an event in New Delhi last month, the Indian government’s chief economic adviser had strong words for critics of India’s energy sector. In a fiery defense of Indian coal energy, Arvind Subramanian – a former IMF economist who worked at Washington’s most influential development think tanks – made it clear his country needed practical solutions instead of “carbon imperialism” that insists on an immediate, unrealistic switch to renewable energies.

Who are the imperialists, in Subramanian’s eyes? As it turns out, his former colleagues at multinational institutions, such as the World Bank. The Bank, under pressure from Barack Obama, decided it would no longer support coal energy initiatives in 2013. Since then, its projects have taken an ambiguous approach to the world’s electrical grid.


While acknowledging the overriding necessity of electricity for businesses and households alike, especially in energy-deprived South Asia and sub-Saharan Africa, the Bank has been adamant that power should not come at the detriment of environmental objectives.

Considering the United States is the largest shareholder in the World Bank and exerts outsized influence over its funding decisions, it hardly came as a surprise to see the Bank’s president go along with the Obama administration’s agenda. Since then, the World Bank and its fellow financiers in the European Union have – at least on paper – cut off support to coal projects and denied financing coal-fired power plants in emerging markets.

The pullback by multilateral banks came as more private-sector interests reconsidered their exposure to coal-related assets, turning the international institutions into lenders (or at least Western lenders) of last resort.

In practice, things have played out differently. Even as they preached a coal-free future, billions of dollars from both the World Bank and the Obama administration went to traditional energy initiatives. For the Bank, it is a vexing conundrum: nearly one-sixth of the global population – 1.2 billion people – lives without reliable electricity. This lack of power hinders opportunities and keeps them in poverty, a stark limitation for these emerging markets.

Like Subramanian, other policymakers in the developing world have not sat by idly as the World Bank and Western governments dictate energy policy to them. Over the past several years, leaders in Nigeria, Tanzania, and the Philippines have insisted on pragmatism in maintaining energy security.

Their argument is simple: coal is and will continue to be used throughout the Global South for decades to come. Instead of blanket bans, the promotion of carbon capture and other clean coal technologies could help expand public access to energy while reducing emissions and avoiding having to retool already-struggling infrastructure.

Those voices are the impetus behind what Subramanian calls a “green and clean coal coalition” spanning both the developed and developing worlds. Emerging markets in Asia and Africa will continue to build new coal-fired power stations for at least the next two decades. In that timeframe, coal-fired solutions are indispensable to meeting their demands for electrification and growth. As clean coal solutions emerge, new plants in the developing world can and should be far cleaner than previous generations of coal-fired plants in Europe and America.

India alone will see its energy demand nearly double between 2020 and 2040, rising 87 per cent. Subramanian’s comments reflect New Delhi’s commitment to carbon capture technologies and improving the efficiency of existing plants. As minister for power Piyush Goyal put it: “Every country needs a baseload. I cannot tell my country, ‘guys, it’s 6pm in the evening, shut everything down because the solar has gone off’.”

The dynamics of African electrification present similar challenges. If India’s energy demand will nearly double in the next two decades, Africa’s will nearly triple. That explains why there are over 100 coal-powered facilities in development across 11 African countries (not including coal-fuelled South Africa) with a total capacity of 42.5 GW. A lack of funding from the World Bank has hardly been an obstacle to these projects: instead of looking to Washington, countries like Kenya are receiving both funding and technical assistance from Beijing.

Multinational institutions would be best served by orienting new coal-powered plants to the cleanest possible models, instead of dogmatically refusing to fund facilities that will be built without them. Some key international sources of finance are already following this path: just two months ago, the Government of Japan launched a partnership with the African Development Bank (AfDB) to provide $6 billion USD of investment in the energy sector, including what Gabriel Negatu of the AfDB calls “the best available low-emissions clean coal technologies”.

Of course, none of these investors exercises as much influence as President Donald Trump and his administration. In one of several ways his election marked a stunning shift from the Obama administration, Trump has emerged as a champion of American coal and an ally for leaders in the developing world who look to coal for electrification.

Just as President Obama’s stance on coal informed the World Bank in 2013, Trump is now bringing his administration’s weight to bear in favour of global coal energy, both on multinational financial institutions and on key emerging markets. Trump has taken his pro-coal message directly to counterparts like Narendra Modi and Petro Poroshenko.

Trump has his own motives for doing this. The US coal sector was plummeting when the new president was sworn in (production reaching its lowest level since 1978), and branching out to emerging markets is an opportunity for the administration to fulfil a campaign promise and maintain blue collar support. US coal has been regaining ground ever since Trump was elected, and that growth has been coming from overseas exports.

Could Trump, then, be the key cog in Subramanian’s “clean coal coalition”? With the US decisively switching camps, the tide seems to have already shifted since the Paris agreement of two years ago. Multilateral institutions, such as the World Bank and governments such as France continue to insist that the war on traditional fuels is still on, but a de facto axis between the United States, China and the developing world is starting to disagree with them.

Sebastien Laye is fellow associate at the Thomas More Institute



I think we can take talk of carbon storage as no more than tokenism. I don’t believe India or any other countries have any interest in spending billions on a process that is not currently economically viable, would significantly raise the price of electricity, and for which there is absolutely no need.

Although the two are often conflated, “clean coal technology” and “carbon storage” are two totally separate things. The first is vital to reduce air pollution and drastically increase the efficiency of the process.

  1. Graeme No.3 permalink
    September 20, 2017 10:17 am

    Out in the real world they don’t think much of the precious eunuchs (self inflicted).
    Of course southern Africa could always claim that the vast majority of man made CO2 was released by countries in the northern hemisphere so it is only fair that they get their turn, especially as it becomes more and more evident that the computer projections are wrong.

  2. Dung permalink
    September 20, 2017 10:24 am

    The Indian position is the one the Tories would once have supported, having previously been recognised as a pragmatic rather than idealistic party.

    • Gerry, England permalink
      September 20, 2017 12:49 pm

      That would be back in the days when they were conservatives. A distant memory.

  3. NeilC permalink
    September 20, 2017 10:46 am

    “Over the past several years, leaders in Nigeria, Tanzania, and the Philippines have insisted on pragmatism in maintaining energy security.”

    Great shame the UK government does hold energy security with any sense of responsibility.

  4. Robert Fairless permalink
    September 20, 2017 10:58 am

    The British Government with its extreme ‘political correct’ and ‘green’ stance refuses to see the connection between coal as an energy source and the reduction of poverty.
    Historically, the use of coal enabled Great Britain to emerged from agricultural poverty through the industrial revolution to relative affluence for every citizen.
    Whatever the disinformation, coal remains the cheapest and most efficient source of energy for which India and China is in desperate need. Who would commit further generations of desperately poor people to another generation of abject poverty. Clearly some governments do, who prefer accolades for heading non-carbon economies. And of course it was of no interest to people like Obama who engaged in another agenda.
    The wilful ignorance of Britain is to be deplored; they have recently completed the conversion of Drax Power Station, the largest and most efficient coal burning power station in Europe, from burning coal to burning wood pellets. This fuel is obtained from the destruction of forests in North America (and elsewhere), reduced and processed to pellets in three American factories, built by Drax and then transported by rail and ship across the North Atlantic to the UK where it is burned in Drax and other newly built similar power stations. Government propaganda and faux science would have us believe this supports a non-carbon economy.
    Is it too late for Britain to benefit from the advice of Arvind Subramian? Probably they are too entrenched and enamoured with their new false religion.

    • Athelstan permalink
      September 21, 2017 7:57 am

      Obarmy was a muppet whose strings were worked by Goldman Sachs.

  5. Don B permalink
    September 20, 2017 12:13 pm

    Actions speak louder than virtue-signalling words.

    Coal fired power plants are being built or planned to be built shortly in 62 countries – a total of 1600 plants.

    • Don B permalink
      September 20, 2017 1:11 pm

      “Over all, 1,600 coal plants are planned or under construction in 62 countries, according to Urgewald’s tally, which uses data from the Global Coal Plant Tracker portal. The new plants would expand the world’s coal-fired power capacity by 43 percent.”

  6. rwoollaston permalink
    September 20, 2017 12:23 pm

    Having repeatedly raised the issue of our daft energy policy with my (Conservative) MP (always courteously!) he tells me he still disagrees with me (no surprise) and can no longer afford the time to respond further as it a subject that none of his other constituents is raising. This latter point is worrying; platforms like these only reach the (relatively few) converted. Because of media and institutional bias there is no public debate on the issue. How can this be changed? I don’t have the answer.

    • Gerry, England permalink
      September 20, 2017 12:48 pm

      The flaw in our ‘democracy’ – lots of people vote but effectively have no power. If you get rid of your Tory who do you get instead who won’t be as stupid?

    • Dung permalink
      September 20, 2017 12:50 pm

      I can not help thinking that a charge of treason against government ministers would stand a chance?
      Most of the actions the government is taking are based on ‘fighting climate change’ and on that basis they are decarbonising the economy. As you rightly point out; the building of coal fired power generation in the rest of the world makes it impossible for any benefit to acrue to anyone by such action. The government is using 100s of billions of pounds of taxpayers money persuing an impossible goal.

    • Robert Fairless permalink
      September 20, 2017 12:59 pm

      A common trait with MPs is that the cannot or won’t think for themselves: they abandoned their critical faculties on entering Parliament. They think what they are told to think. An example is the infamous Climate Change Act, a folly beyond measure, which was passed into law by negligent Members of Parliament with only five opposing and none of whom had read or even seen the Bill (it had been criminally concealed by Gordon Brown) and who voted as they were told to vote. The whole country is suffering the consequences the, ‘wood pellets’ being just one example.

      • Robert Fairless permalink
        September 20, 2017 1:24 pm


  7. Jack Broughton permalink
    September 20, 2017 4:44 pm

    A good sensible article about the realities of the world: notably Japan is investing in coal projects in several countries, the USA is selling coal as fast as it can etc. If climate change was significant this would not occur.
    The advanced coal technology referred to in the article is mainly “ultra-supercritical” technology which provides about 4% more efficiency. CCS is a cover-up to soften the message as it is not fully developed for coal and would almost certainly cost more in efficiency and capital than it could ever hope to recover..

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