Global coal-buying binge could dent emissions progressDecember 3, 2012: 10:26 AM ET
One chart from a recent World Resources Institute report shows just how major the challenge is.
By Brian Dumaine, senior editor at large
FORTUNE -- In the wake of the damage wrought by Sandy in the Northeast, some politicians like New York Governor Andrew Cuomo and New York City Mayor Michael Bloomberg have stressed the need to do more to battle climate change and thus reduce the intensity and frequency of such storms. This is a noble and necessary endeavor. A new report, however, by the World Resources Institute, a Washington, DC think tank, suggests that America and its green house gas emissions, while important, aren't the real problem. As the U.S. strives to cut its carbon emissions, China, India and the rest of Asian and parts of Africa are on a coal-buying binge that seems likely to more than cancel out any American progress on emissions cuts.
In the WRI report, called Global Coal Risk Assessment, authors Ailun Yang and Yiyun Cui estimate that 1,199 new coal-fired plants, with a total installed capacity of 1,401,278 megawatts, are being proposed globally. That's the rough equivalent of building 1,400 nuclear power plants -- only unlike nuclear plants coal generators are largest emitters of greenhouse gas and one of the worst contributors to climate change.
These projects are spread across 59 countries with China and India together accounting for 76% of the proposed new coal power capacity. China is opening about one new coal plant every week. At the same time the International Energy Agency estimates, global coal consumption reached 7,238 million tons in 2010, the latest data available. China accounted for 46% of the consumption, followed by the United States at 13%, and India with 9%. Obviously this is not good news for the environment. According to a newly released report by the nonprofit the Global Carbon Project, world-wide emissions of greenhouse gas hit a record high in 2011 and are expected to keep rising in 2012.
To put China's love affair with coal in perspective, the U.S. currently has only 36 coal plants on the drawing board. With a second Obama term and tough EPA regulations, it's highly unlikely that any of these plants will get built. Also, thanks to fracking technology, America has as much as a 100 year supply of cheap, relatively clean natural gas that is pushing coal aside as a favorite fuel for utilities.
China has natural gas supplies that can be tapped by fracking, but the country needs to develop the technology and know-how to tap into this fuel—and that is years off. The Chinese are also installing lots of wind and solar power, but even so this amounts to a very small percentage of the country's total energy needs. In the meantime, cheap coal is king in China, India and elsewhere in the developing world.
One hope is that the utilities can devise clean coal technology to capture the CO2 rising from these plants but right now that technology is expensive and it hard to see why the developing world at this point will put up the money to fix the problem. If climate change is to be addressed seriously, it may in the end be up to cash-strapped Western nations to provide the funds for clean coal technology—a scenario that's unlikely to gain much political support.