Don’t bank on clean coal, says leading insurance company « Mining Blog

Don’t bank on clean coal, says leading insurance company

15. November 2012,

Two reports were released this week, which attempted to assess the future for global coal demand and use.

Although both the International Energy Agency (IEA) and the UK’s AXA Investment Managers believe that demand for the black stuff will decline over the next 20 years, it certainly won’t be by much and, in the meantime, is set to increase. Nor will any eventual reduction in coal burning substantially abate global greenhouse gas emissions, or other coal-related pollution, at anything like the rate required.

According to the reports, global coal demand will rise in the short-term as emerging markets rely on it to power economic expansion. However, The International Energy Agency (IEA) said in its World Energy Outlook that, although coal would remain the world’s leading fuel for power generation over the next two decades, its share would drop, mainly losing out to rising demand for natural gas and renewables.

Just a fortnight ago, PricewaterhouseCoopers (PwC) warned that, under existing industrial growth scenarios, global greenhouse gas emissions would unacceptably accelerate by 2050. Coal-burning would be a major contributor in this fateful direction.

PwC did say that carbon capture and storage (CCS) of carbon released from coal-fired power plants could help slow our headlong rush towards doomsday.

Invited by Reuters (13 November 2012), to comment on the two reports, The Global Coal Association was also confident that increased power plant efficiency will reduce pollution from the burning of lower-quality, and therefore dirtier, coal.

But AXA’s report vigorously dissents on both these counts, asserting that: “For the next round of rapidly growing economies, the incentive bias towards coal will be shorter-lived than expected (and) stricter pollution controls may render many new coal-burning installations obsolete”.

In respect of CCS, AXA judged that the technology “…will not turn coal into a sustainable source of energy for power generation. The polluting effects of coal are not limited to CO2 alone. CCS technologies are energy-intensive and could take decades to mature.”

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