GWPF | 22 May 2015
EU Climate Policy Will ‘Completely Destroy Steel Industry’s Profitability’
India has told a high-level energy meeting here that it will not be fair to expect it to move away from coal to meet energy requirements of millions of Indians, underscoring that coal will continue to remain the “mainstay” of its energy needs for the “foreseeable future.” —Press Trust of India, 22 May 2015
Just as in all other countries, including the developed world, coal will continue to remain the mainstay of our energy related needs for the foreseeable future. In all fairness, it would not be correct to say or to expect India to move away from coal when we are at the cusp of our developmental journey. — Indian Energy Minister Piyush Goyal, Press Trust of India, 22 May 2015
1) India Won’t Shift Away From Coal, Minister Tells UN – Press Trust of India, 22 May 2015
2) Southeast Asia’s Coal-Powered Future – Bloomberg, 22 May 2015
3) Coal And Gas Power Dying Out In Europe, Says Energy Chief – Financial Times, 22 May 2015
4) EU Climate Policy Will ‘Completely Destroy Steel Industry’s Profitability’ Frankfurter Allgemeine Zeitung, 21 May 2015
5) Europe’s Dying Industries: Manufacturers Investing Outside Germany – Metal Bulletin, 16 April 2015
6) UN Climate Deal Contingent On $100 Billion Climate Funding: France – Reuters, 21 May 2015
Energy ministries from more than 30 nations are meeting at the UN this week, at the Sustainable Development for All Forum, to debate how best to supply electricity to the 1.3 billion people who don’t have it—at least 250 million of whom are Indians. Erasing energy poverty also means more coal for developing countries, and India is the developing world’s most ardent defender of its use. Southeast Asia is adding 205 gigawatts of coal overall by 2020, one of the most intense periods of coal-plant construction ever. –Eric Roston, Bloomberg, 22 May 2015
Gérard Mestrallet, chief executive of Engie, one of the world’s biggest power companies, says fossil fuel electricity generation is on the way out in Europe. “The choice we have made is very clear. We have stopped investing — and so did the others by the way — in thermal power generation in Europe and we are investing in renewables,” he said. Many of Europe’s big power companies have been forced to mothball gas plants and write down assets as they struggle with overcapacity and the growth of subsidised renewables. –Michael Stothard and Pilita Clark, Financial Times, 21 May 2015
The planned increase in the price of European carbon credits would result in “prohibitive cost” for the steel industry the German Steel Federation has warned. If the plans would come true, German steel companies alone would be burdened by additional costs of one billion euros annually until the end of the next decade, Hans Jürgen Kerkhoff, the President of the German Steel Federation said. TKSE board member Herbert Eichelkraut said he expects the implementation to lead to an increase in the price of the steel by about 20 percent. “That would completely destroy our profitability.” —Frankfurter Allgemeine Zeitung, 21 May 2015
Energy-intensive manufacturers are starting to make investments outside Germany because of its rising energy costs, a trend that will include the copper industry, the ceo of German copper producer Aurubis said. Bernd Drouven said that the closure of Germany’s nuclear plants and high but unrealistic targets in renewables mean companies are taking their planned-growth investments to other countries. “Industry is not likely to move out of Germany – what will happen will be a reallocation of capital, and that is already happening,” he said, noting that in the chemicals industry, large companies are not investing in Germany any more. —Metal Bulletin, 16 April 2015
Rich countries need US$70 billion more to reach the US$100 billion goal of the U.N. Green Climate Fund set up at the 2009 Copenhagen Climate Conference. A global agreement on funding poor nations will be essential before reaching any climate change deal at the upcoming U.N. Climate Conference which kicks off Nov. 30 in Paris, French President Francois Hollande said Tuesday. “Without any financial commitment, there won’t be an agreement in Paris,” said Hollande at the Sixth Petersberg Climate Dialogue hosted in the German capital of Berlin. —Reuters, 21 May 2015
1) India Won’t Shift Away From Coal, Minister Tells UN
Press Trust of India, 22 May 2015
India has told a high-level energy meeting here that it will not be fair to expect it to move away from coal to meet energy requirements of millions of Indians, underscoring that coal will continue to remain the “mainstay” of its energy needs for the “foreseeable future.”
“Our energy challenge is truly huge. The numbers speak for themselves,” said Minister for State for Power, Coal and New & Renewable Energy Piyush Goyal at the First Global Energy Ministerial SE4ALL Forum Meeting yesterday.
India has 56 million homes or 280 million Indians, almost the size of the population of the US, who lack access to basic electricity and more than 500 million are still deprived of access to clean energy fuels, he said.
“Just as in all other countries, including the developed world, coal will continue to remain the mainstay of our energy related needs for the foreseeable future.
“In all fairness, it would not be correct to say or to expect India to move away from coal when we are at the cusp of our developmental journey,” Goyal said.
He said that countries that have benefited over the years from cheap fossil fuel-based energy, must also participate proactively in efforts to leave behind a cleaner planet by expanding the scope of renewable energy.
“I believe this has to be a shared responsibility of the developed world and the developing countries,” he said.
“The developed world, which has over the last 150 years enjoyed this low cost power for its own growth and prosperity must share this responsibility and come forward proactively in a much deeper engagement with the developing countries,” he said.
Goyal outlined Prime Minister Narendra Modi-led government’s mission to provide 24/7 energy access to every Indian across the length and breadth of the country by 2019.
“We do understand and it is indeed incumbent upon us to protect the world to ensure a cleaner planet for the next generation.
“However, it is also important to understand the agony of poverty. It is important to understand the pain that the common man experiences when he is required to pay very high cost for energy,” he said.
2) Southeast Asia’s Coal-Powered Future
Bloomberg, 22 May 2015
Eric Roston
Southeast Asia is adding 205 gigawatts of coal overall by 2020, one of the most intense periods of coal-plant construction ever.
Energy ministries from more than 30 nations are meeting at the UN this week, at the Sustainable Development for All Forum, to debate how best to supply electricity to the 1.3 billion people who don’t have it—at least 250 million of whom are Indians. The drive toward universal energy access is just one element of the UN’s Sustainable Development Goals, a super-ambitious worldwide to-do list that the nations would like to finalize in New York in September, shortly before they meet again in Paris in December to finish a climate change treaty. That’s the shaky part.
Despite aggressive investments in solar-powered electricity almost everywhere, erasing energy poverty also means more coal for developing countries, and India is the developing world’s most ardent defender of its use.
India thinks of coal right primarily as a poverty-fighting tool. It’s the most vocal and influential champion of the fuel these days now that China’s industrial hangover has begun. China in March took the dramatic step of shutting down the last four major plants that serve smog-choked Beijing, and recent analyses suggest that its coal use overall may peak by 2020.
Indian coal demand could jump 42 percent, or 300 million metric tons, by 2020, and India is expected to add 124 gigawatts of electricity capacity in that time, according to Bloomberg Industries. In just two years, it may surpass China as the largest importer of seaborne coal.
The Global Coal Plant Tracker, below, shows where it’s happening (everywhere). The tracker is a project of the environmental research group CoalSwarm, which is funded in part by the Rockefeller Family Fund, the Natural Resources Defense Council, the Sierra Club, and the Energy Foundation.
Where plants are announced (yellow), in development (light orange), permitted (orange), in construction (red), and new since 2010 (brown). Global Coal Plant Tracker, CoalSwarm
Southeast Asia is adding 205 gigawatts of coal overall by 2020, one of the most intense periods of coal-plant construction ever.
The Indian government understands the climate problem. Like China, it believes that the West has had a century or two to enjoy fossil fuels, and that developed nations should wind down the fires while India catches up. India has taken a harder line than China on commitments it is willing to make in the UN climate talks.
Rich nations have to some extent acknowledged the historical pattern. India is right about the West polluting for decades before the Asia boom started. But the developed nations are opposed to climate change policies that might punish them economically, and like to point out that the developing world is making up for their late economic start with record emissions in record time.
A fortuitous quirk of the last several years is that the U.S. has discovered a way to reduce its emissions rate and enjoy economic growth at the same time. The natural gas boom has made coal less competitive, and coal’s share of electricity generation has shrunk frommore than 50 percent in 2005 to 39 percent today. The Obama administration has been trying to lock in that pain with the first ever CO2 regulations, which should be final this summer.
The upshot is that the U.S. is dropping coal plants at an unprecedented rate, but still nowhere near as quickly as India is adding them. By the end of this year, some 7.5 percent of the U.S. coal fleet will have disappeared, casualties of low natural gas prices, old age, and new regulations. That’s a lot. But by 2020, India may have built about 2.5 times as much capacity as the U.S. is about to lose.
3) Coal And Gas Power Dying Out In Europe, Says Energy Chief
Financial Times, 22 May 2015
Michael Stothard and Pilita Clark
Gérard Mestrallet, chief executive of Engie, one of the world’s biggest power companies, says fossil fuel electricity generation is on the way out in Europe.
The economics of gas and coal power generation have deteriorated to the point that future growth is more likely to come in big emerging markets such as India and China, rather than the EU, he told the FT on the sidelines of a business and climate change conference in Paris on Wednesday.
“The choice we have made is very clear. We have stopped investing — and so did the others by the way — in thermal power generation in Europe and we are investing in renewables,” he said.
It was a different story in emerging markets, which needed more thermal energy to grow, said Mr Mestrallet, whose company was formerly called GDF Suez. But in Europe future growth was in renewables.
“We are adapting to the market,” he said. “We continue to build big power plants in emerging countries: Brazil, Chile, Peru, the Middle East and Asia.”
Many of Europe’s big power companies have been forced to mothball gas plants and write down assets as they struggle with overcapacity and the growth of subsidised renewables.
Mr Mestrallet, one of France’s most powerful industrialists, was speaking as other senior executives lined up to declare their dedication to tackling climate change.
In one of the more surprising moves, the head of one large European power company revealed that his business was aiming to halt all carbon emissions within 35 years.
“Our strategy is expected to be a zero emissions company by 2050,” said Daniel Benes, chief executive of the Czech group, CEZ, which has coal power plants around central Europe.
“Coal power plants will still have their place in power generation in the near future,” said Mr Benes but it was clear that in the long term this had to change.
“In 2050 Europe should be a zero emissions area,” he said.
His remarks drew a round of applause from fellow executives at the conference, which sometimes sounded more like a gathering of environmental activists than corporate chiefs.
4) EU Climate Policy Will ‘Completely Destroy Steel Industry’s Profitability’
Frankfurter Allgemeine Zeitung, 21 May 2015
The planned increase in the price of European carbon credits would result in “prohibitive cost” for the steel industry the German Steel Federation has warned.
If the plans would come true, German steel companies alone would be burdened by additional costs of one billion euros annually until the end of the next decade, Hans Jürgen Kerkhoff, the President of the German Steel Federation said.
Two weeks ago, the EU decided to reduce the supply of industrial CO2 emission rights as of 2019 in order to increase the carbon price. Federal Environment Minister Barbara Hendricks (SPD) welcomed the EU plans as good news for climate protection.
TKSE board member Herbert Eichelkraut said he expected the implementation of the EU plan to lead to an increase in the price of the steel by about 20 percent. “That would completely destroy our profitability.”
The industry stands in sharp competition with China and India, among others, Kerkhoff said. The steel industry is an important employer. ThyssenKrupp Steel alone employs around 26 000 people.
5) Europe’s Dying Industries: Manufacturers Investing Outside Germany
Metal Bulletin, 16 April 2015
Energy-intensive manufacturers are starting to make investments outside Germany because of its rising energy costs, a trend that will include the copper industry, the ceo of German copper producer Aurubis said.
Bernd Drouven said that the closure of Germany’s nuclear plants and high but unrealistic targets in renewables mean companies are taking their planned-growth investments to other countries. “Industry is not likely to move out of Germany – what will happen will be a reallocation of capital, and that is already happening,” he said, noting that in the chemicals industry, large companies are not investing in Germany any more.
“Job cuts due to closures are not easy, so it’s far easier for companies to maintain operations in Germany at existing levels, but see their expansions and future growth elsewhere,” he told Metal Bulletin in an interview.
Full interview (subscription required)
6) UN Climate Deal Contingent On $100 Billion Climate Funding: France
Reuters, 21 May 2015
Rich countries need US$70 billion more to reach the US$100 billion goal of the U.N. Green Climate Fund set up at the 2009 Copenhagen Climate Conference.
A global agreement on funding poor nations will be essential before reaching any climate change deal at the upcoming U.N. Climate Conference which kicks off Nov. 30 in Paris, French President Francois Hollande said Tuesday.
“Without any financial commitment, there won’t be an agreement in Paris,” said Hollande at the Sixth Petersberg Climate Dialogue hosted in the German capital of Berlin.
“Developing countries won’t accept an agreement if they do not get any financial support for adaptation and (energy) transition – and I am thinking in particular of African countries.”
Governments of the world had agreed at the 2009 U.N. talks in Copenhagen that the richest countries would fund the poorest with US$100 billion per year by 2020 from public and private sources.
The funds would help them both to cope with the effects of climate change and to transform their economies into a more sustainable model.
However, the richest countries could only mobilize US$30 billion so far; German Chancellor Angela Merkel called for a roadmap for how the world will raise the additional $70 billion, adding that her country will provide its share.
