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Green Policies Return the World to Coal

Green Policies Return the World to Coal

There’s scarcely a place in the modern world that will not be feeling the high cost and discomfort of a shortage of energy supplies and their increasingly soaring prices. Lebanon already is. Due to a shortage of oil, the two power plants that supply 40% of that country’s electricity shut down. There is no electricity in Lebanon and will not be any for some days.

It’s an extreme case, but even the United Kingdom, the EU, the U.S., and China are running up against diminishing ability to obtain the necessary energy supplies to keep things running smoothly. Some of the shortages are due to accidents, like the cutting of an undersea cable to the UK, but most are due to green policies and stupid political choices, ironically shutting down oil and gas-fired power plants and fossil fuel exploitation and transport at the demand of the greens, who grossly overestimate both global warming and the ability of air, sun and water to take their place. Ironically, this means coal — the dirtiest possible fuel — is back in huge demand,

Despite an import ban on Australian coal, China relented and has begun unloading Australian coal because of an extreme power crunch. Coal is now in demand in Europe as gas prices soar and the EU’s energy policies are in large responsible:

The ideological split will drive a wedge between the European Union, a long-time champion of a coal phaseout, and corporate interests as market conditions favour gas-to-coal switching. The switching ratio has slid in coal’s favour in the last weeks of June 2021 and judging by the current futures structure, it will stay in place until at least Q2-2022 [snip] Given the natural limitations to further coal utilization, in Germany the main interaction in the upcoming weeks will be between coal and wind…

…click on the above link to read the rest of the article…

Coal Generation In UK Jumps As Wind Speed Drops

Coal Generation In UK Jumps As Wind Speed Drops

Coal met some 3 percent of the UK’s electricity demand on Friday morning, reaching its highest level of Britain’s power generation in one month, amid lower wind speeds this week and an outage at a gas-powered plant, Bloomberg reports.

The last time the UK generated 3 percent of its electricity from coal was in early September when low wind generation reduced renewable power supply and triggered the massive spikes in UK wholesale electricity prices.

Utility Uniper fired up its coal-powered plant in Ratcliffe early on Friday, while the gas-fired plant in Pembroke, Wales, operated by RWE, suffered an unplanned outage.

Over the past week, gas has consistently accounted for the largest share of the UK’s electricity generation, according to data from National Grid ESO. For example, on Wednesday, gas produced 44.8 percent of Britain’s electricity, more than wind with 19.2 percent and nuclear with 12.6 percent.

Surging natural gas prices and warm and still weather in September forced the UK to fire up an old coal plant that was on standby in order to meet its electricity demand.

The UK has pledged to phase out coal-fired power generation by October 2024.

UK power company Drax could have its last two coal-fired plants in the country operating beyond the 2022 deadline it had set for closure if the UK government asks it to keep them operational amid the energy crisis in the country and the whole of Europe.

“If the government wants us to rethink our plans, we need to talk to them in the next few months,” Drax’s chief executive Will Gardiner told the Financial Times at the end of September.

Last week, the UK government committed to decarbonizing the country’s electricity system by 2035.

…click on the above link to read the rest of the article…

China Coal Prices Soar To Record As Winter Freeze Spreads Cross The Country

China Coal Prices Soar To Record As Winter Freeze Spreads Cross The Country

One week ago we discussed why the “worst case” scenario for China’s property crisis is gradually emerging; to this we can now add that China’s worst case energy crisis scenario is also about to be unleashed as cold weather swept into much of the country and power plants scrambled to stock up on coal, sending prices of the fuel to record highs.

Electricity demand to heat homes and offices is expected to soar this week as strong cold winds move down from northern China, according to Reuters with forecasters predicting average temperatures in some central and eastern regions could fall by as much as 16 degrees Celsius in the next 2-3 days.

Shortages of coal, high fuel prices and booming post-pandemic industrial demand have sparked widespread power shortages in the world’s second-largest economy. Rationing has already been in place in at least 17 of mainland China’s more than 30 regions since September, forcing some factories to suspend production and further disrupting already broken supply chains.

On Friday, the most-active January Zhengzhou thermal coal futures closed at a record high of 2,226 per tonne early. The contract has risen almost 200% year to date.

China’s three northeastern provinces of Jilin, Heilongjiang and Liaoning – also among the worst hit by the power shortages last month – as well as several regions in northern China including Inner Mongolia and Gansu have started winter heating, which is mainly fuelled by coal, to cope with the colder-than-normal weather.

…click on the above link to read the rest of the article…

China Coal Futures Hit Record High As Mines Flood; Worsening Power Shortages Hit Rust Belt 

China Coal Futures Hit Record High As Mines Flood; Worsening Power Shortages Hit Rust Belt 

China’s top coal-producing region has been devastated by torrential rains and flooding this past week. About 9% of the coal mines in Shanxi province, an area responsible for producing 30% of China’s supply, have closed operations. The direct effect of this has been a spike in coal futures.

Heavy rainfall flooded Shanxi over the weekend. More than 120,000 people have been evacuated, and 60 of the 682 coal mines in the province have been closed. Industrial yards and manufacturing complexes have also been shuttered due to flooding.

The province is usually a dry area but record-breaking rain last week complicated things for the mining industry. This also comes at a time when Beijing has called on mining companies to boost output amid a nationwide power crunch.

Source: Bloomberg 

As a result, Coal futures on the Zhengzhou Commodity Exchange jumped 12% to $218.76 per ton, a new record high, on Monday.

A devastating and widespread power crunch has hit China in recent months, resulting in as many as 20 provinces or about 66% of the country’s GDP have announced some form of power cuts. Due to the growing energy crisis, Goldman Sachs told clients last month that the energy crisis will severely impact the country’s economic growth.

Source: Bloomberg

For the fourth quarter, Citic Securities analysts told clients, China faces a gap of 30 million to 40 million tons of coal. This translates into reducing industrial power use by 10% to 15% in November and December. UBS Group AG said this would result in a 30% slowdown in activity in energy-intensive industries like steel, chemicals, and cement-making.

Beijing has also approved electricity prices to increase by 20% against the benchmark, compared with a current cap of 10%, allowing more power plants to economically produce power considering high costs for fossil fuels, such as coal, natural gas, and crude.

…click on the above link to read the rest of the article…

Energy Crisis May Unleash Winter Blackouts Across US, Insider Warns 

Energy Crisis May Unleash Winter Blackouts Across US, Insider Warns 

The energy crisis that is rippling through Asia and Europe could unleash electricity shortages and blackouts in the U.S., according to Bloomberg.

Ernie Thrasher, CEO of Xcoal Energy & Resources LLC., told energy research firm IHS Markit that U.S. utilities quickly turn to more coal because of soaring natural gas prices.

We’ve actually had discussions with power utilities who are concerned that they simply will have to implement blackouts this winter,” Thrasher warned.

He said, “They don’t see where the fuel is coming from to meet demand,” adding that 23% of utilities are switching away from gas this fall/winter to burn more coal. 

With natgas, coal, and oil prices all soaring is a clear signal the green energy transition will take decades, not years. Walking back fossil fuels for unreliable clean energy has been a disaster in Asia and Europe. These power-hungry continents are scrambling for fossil fuel supplies as stockpiles are well below seasonal trends ahead of cooler weather.

A similar story is playing out in the U.S., where increased demand for coal might not be reached by mining companies. We noted Thursday morning that boosting output might be challenging due to years of decommissioning mines to reduce carbon emissions and transition the economy from fossil fuels to green energy. There’s also been a steady decline of miners over the last three and a half decades.

 “That whole supply chain is stretched beyond its limits,” Thrasher said. “It’s going to be a challenging winter for us here in the United States.”

Utility company Duke Energy Corp.’s Piedmont Natural Gas unit, covering North and South Carolina customers, warned power bills this winter are set to rise due to high natgas prices and low production.

Coal for Christmas

Coal for Christmas

China’s Supply Chains in an Energy Crisis

In mid-April 2021, I began receiving reports from sources in China and the United States that certain regions in China had begun to experience ongoing power disruptions at their warehouses and manufacturing facilities. Most notable of these was in south China’s Guangdong megaregion, where in June operations at the Taishan Nuclear Power Plant had become disrupted by a small number of faulty claddings for the fuel rods, ultimately forcing state-owned General Nuclear Power Group to shut down Unit 1 (there are two units) for maintenance and repair. Concurrently, available power imported to the Guangdong region from Yunnan province’s considerable hydroelectric capacity was reduced due to drier-than-expected weather throughout the spring.

Taken together, some estimates are that total power available to the region fell by as much as 15% by June. In response, officials began quietly rationing power to factories, cutting business operation days by 1 or 2 days depending on the facilities’ power requirements.

In recent weeks, however, officials have begun a much more aggressive rationing program (Figure 1), with factories in much of Guangdong now seeing only 1-2 days per week of power use allowed. Similar situations are reportedly occurring in Jiangsu, Hubei, and Fujian provinces, all major manufacturing regions. As just one example, one of my US-based import customers has reported that a key supplier in Jiangsu is down to a single day per week of power availability. Limited-but-expanded power rationing is also occurring in Zhejiang, Shandong, Liaoning, and other important heavy industrial, chemical, and energy-product hubs.

Map

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Figure 1 – Chinese Province Power Rationing Regime – Courtesy of The Lantau Group

The primary causes of power disruptions are the aforementioned reduced availability of hydroelectric power in much of southern China, as well as limited supplies of coal due to the ongoing China/Australia trade dispute…

…click on the above link to read the rest of the article…

Europe Turns To Russia For More Coal As Energy Prices Skyrocket

Europe Turns To Russia For More Coal As Energy Prices Skyrocket

  • Europe is facing a perfect storm of increasing demand for energy in the wake of the COVID-19 pandemic, and a dwindling supply of natural gas used to produce electricity.
  • As Europe’s struggling energy markets look to import any form of affordable energy they can, power producers have resorted to asking for Russian coal as well.
  • Europe is competing with Asia for limited energy resources as both continents surge back to life as pandemic restrictions ease.

Energy prices are through the roof across Europe as demand surges and supplies tighten in the wake of the novel coronavirus pandemic. Over the course of the global economic shutdown, energy production has decreased considerably as industries shut down, people stayed inside, and demand for electricity and fuel plummeted. Now, as the world returns to work and gets back to the ‘new normal’, energy demand is back with a vengeance, but the energy supply simply isn’t there.

Europe’s leading natural gas benchmark, the Dutch Title Transfer Facility, reports that prices have skyrocketed from €16 per megawatt-hour at the beginning of this year to €75 by mid-September, representing an increase of more than 360%. Italian officials have warned their citizens to expect a 40% increase in their bills in the coming weeks and months. Spain has agreed to send €100 payments to over 5.8 million low-income households and sent a letter to Brussels pleading with the European Union (EU) to take sweeping action.

And then there’s Russia. Nearly half of all-natural gas imports in the EU come from the great white north, making Europe highly dependent on the Kremlin for its energy security. This dependence is a big part of the reason that Europe is now entering into an energy crisis, because as demand for natural gas has surged, Russia has not increased its exports to the EU…

…click on the above link to read the rest of the article…

German Power Plant Halted After It Runs Out Of Coal

German Power Plant Halted After It Runs Out Of Coal

In the history of the world, German electricity prices have never been higher…

… and if what just happened at the Steag Bergkamen-A electric plant is any indication, they are about to get a whole lot higher.

According to Bloomberg, the global energy crisis has forced a German electricity producer to halt a power plant after it ran out of coal.

Steag GmbH – which operates six large-scale hard coal plants in Germany with an installed capacity of more than 4,000 MW – closed its Bergkamen-A plant in the western part of the country this week due to shortages of hard coal, it said by email.

The Bergkamen power station. Source: Google Maps

“We are short of hard coal,” said Daniel Muhlenfeld, a Steag spokesman. “There is a strong demand for coal per se and secondly, there is a strong demand for transport by barge. And since Bergkamen has no rail connection, there are no logistical alternatives available here.”

Steag is also facing logistical challenges as the recovery of Europe’s biggest economy fuels demand for river transport. Still the utility is optimistic that the plant will come back online “quite soon.” The Bergkamen-A plant was halted four times in September for as many as six days at a time due to external factors, according to filings. Three other German coal plants were halted on Friday for maintenance.

“We are dealing with a double bottleneck.” Muhlenfeld said. “This is not a specific problem for Steag but a common problem for nearly all owners of hard coal-based power plants these days.”

…click on the above link to read the rest of the article…

The World Won’t Buy Alberta’s Second-Rate Coal: Experts

The World Won’t Buy Alberta’s Second-Rate Coal: Experts

What Kenney wants mined is such poor quality ‘it won’t make the cut’ for global markets, panel told.

Half a dozen mining proposals to extract low-quality coking coal in the eastern slopes of the Rockies don’t make any economic sense and shouldn’t be allowed, say two Alberta coal experts with more than 70 years’ experience in the industry.

In separate written submissions to Alberta’s Coal Policy Committee this summer, a retired geologist and a mining engineer testified that the market value of metallurgical coal seams in Alberta will never be able to compete with the quality of coking coals in B.C.’s Elk Valley mined by Teck Resources.

“These speculative mines don’t meet the requirements to be viable by any economic analysis,” said Cornelis Kolijn, a semi-retired process mining engineer with extensive experience in metallurgical coal, coke making and product development around the world over 40 years.

The Kenney government reluctantly created Alberta’s Coal Policy Committee after it initiated a political scandal by abruptly rescinding long-standing coal development rules in 2020 without public consultation.

Those rules prevented mining in much of the eastern slopes, but Australian coal miners learned of their removal before Albertans did.

Public outcry then forced the government to reinstate its coal policy and create a five-member committee to investigate the future of coal mining in the eastern slopes.

All summer long it has been hearing submissions from Albertans, First Nations, environmentalists, ranchers and Australian coal companies. It will make its recommendations in the fall.

…click on the above link to read the rest of the article…

New South Wales’ coal fired power plants operating at close to rated capacity: winter 2021

New South Wales’ coal fired power plants operating at close to rated capacity: winter 2021

This article follows 2 earlier posts on power price spikes in May 2021 (Tomago alu smelter load shedding and Callide C4 explosion)

It is easy enough to click on the following link of the National Electricity Market (NEM) to get the percentage of coal used by power plants:

https://opennem.org.au/energy/nsw1/?range=7d&interval=30m

Fig 1: NSW power generation by source of primary energy for 7 days in July 2021

Note there was a lot of wind on 17/18th and 20th July. The afternoon peaks need gas and (pumped) hydro.
The dependency on coal was around 70% over 7 days (even higher as power imports from Queensland and Victoria also contain coal; pumped hydro may also be powered by off-peak coal). Let’s go through the list of NSW coal plants from AEMO (Australian Energy Market Operator)

Fig 2: AEMO’s generation information for NSW coal plants (dated 13/7/21)
https://aemo.com.au/en/energy-systems/electricity/national-electricity-market-nem/nem-forecasting-and-planning/forecasting-and-planning-data/generation-information

Note that 3 days later on 16/7/21 the Australian Energy Regulator (AER) granted AGL’s application of 30/4/2021 to swap the closure of Liddell units 4 and 3:
Under the exemption, LD03 will close on 1 April 2022. AGL will then delay the closure of LD04 to 1 April 2023.
https://www.aer.gov.au/communication/agl-provided-exemption-from-notice-of-closure-requirements-to-improve-reliability

Compared to the May 2021 version of the above table, Bayswater upgrades (3×25 MW committed) were added. The Redbank power plant has shut down in August 2014 (change log, line 447). There are controversial plans of the current owner of the site to use 1 mt pa of woodchips as fuel source.
https://www.verdantearthtechnologieslimited.com/wp-content/uploads/2021/02/Redbank.pdf

NEM also publishes data on individual power plants and their units:

Fig 3: Bayswater: BW02 was not in operation
https://opennem.org.au/facility/au/NEM/BAYSW/?range=7d&interval=5m

BW01 stopped on the 19th in the middle of the night. That was the beginning of the week. When writing this article, it had not come back. The following graph shows the daily generation over the day.

Fig 4: BW01 stopped on the 19th in the middle of the night

…click on the above link to read the rest of the article…

Depleted Gas Stocks Force Europe To Use More Coal

Depleted Gas Stocks Force Europe To Use More Coal

With power demand recovering from the pandemic, European utilities are using more coal as natural gas inventories are unusually low for this time of the year due to a cold snap in late winter and early spring.

This year, despite the record-high carbon price in Europe, the use of coal for power generation has jumped by up to 15 percent, Andy Sommer, team leader of fundamental analysis and modeling at Swiss trader Axpo Solutions, told Bloomberg in an interview published on Tuesday.

“Gas storage is so low now that Europe cannot afford to run extra power generation with the fuel,” Sommer told Bloomberg.

Natural gas stockpiles are some 25 percent below the five-year average, and with such a right gas market, utilities run more coal-fired power generation, analysts say.

Europe had already started to restock with natural gas following a harsh winter that drained inventories when a cold snap in April caused unusual additional withdrawals from storage.

“A cold snap in April caused a counter-seasonal net withdrawal of inventory, worsening the storage situation which for several months has been running below seasonal averages,” Wood Mackenzie said in its Q2 LNG short-term trade and price outlook at the end of May.

As a result of the low levels of natural gas in storage, the price of the Dutch TTF gas, the European benchmark, has rallied by over 50 percent so far in 2021. Prices are close to the highest level for late spring since 2008, according to Bloomberg estimates.

With the ultra-tight gas market, power generation from coal is rising in Europe, despite the record-high EU carbon price, which exceeded US$60.50 (50 euro) per ton in early May.

The current situation with the power mix in Europe is indicative of the challenges the continent and the European Union face in their push to make the grids greener.

…click on the above link to read the rest of the article…

Spare production capacity to erode in absence of fresh investments, warns IEA

Spare production capacity to erode in absence of fresh investments, warns IEA

Middle East to dominate 2021-2026 supply growth, US rise to be modest

Effective spare capacity could shrink to lowest since 2016

Supply growth to slow on spending cuts, project delays, demand uncertainty

London — The world’s oil production capacity is expected to slow in the medium-term as the market digests the full impact of COVID-19 and the pivot toward cleaner energy, the International Energy Agency said on March 17.

The Paris-based agency warned in its Oil 2021 report that the industry’s spare capacity supply cushion will slowly erode in the absence of fresh upstream investments.

“By 2026, global effective spare production capacity (excluding Iran) could fall to 2.4 million b/d, its lowest level since 2016,” the report said.

Global oil supply growth is set to slow down from 2021 to 2026 due to spending cuts, project delays, and demand uncertainty, caused by the oil price crash and the pandemic.

Only a marginal rise in global upstream investment is expected this year after they fell by a record 30% in 2020 compared to the previous year, the IEA noted.

Many in the industry have recently warned that oil and gas investment will need to see a huge boost to prevent a supply crunch that could send prices skyrocketing and tip the global economy back into crisis.

Impact on upstream

2020 was a cataclysmic year for the oil industry, as capital expenditure and upstream spending fell dramatically.

The deferral of upstream projects has wiped out over 2 million b/d of potential supplies by 2026, according to the IEA. But spending is likely to stay around 15% below 2019 levels in the medium term.

“While spending looks set to remain constrained this year, a modest return to growth has been flagged further ahead,” the report said.

…click on the above link to read the rest of the article…

 

When Is Mountaintop Removal Not Mountaintop Removal? In Alberta, of Course!

When Is Mountaintop Removal Not Mountaintop Removal? In Alberta, of Course!

The Kenney government plays word games as it plans to strip-mine the Rockies.

In Alberta, the government of Jason Kenney has one definition for mountaintop removal, while most people have another.

You might think that excavating the top of a mountain until it’s reduced to a series of carved away “benches” that rise like giant steps to a last shred of a mountain’s peak is “mountaintop removal.”

If so, you disagree with the Alberta government.

Here’s someone else who disagrees with the Kenney definition. Australian coal miners.

While the Kenney government claims mountaintop removal can’t happen in Alberta’s water-sensitive eastern slopes, Benga Mining, an Australian firm owned by Aussie billionaire Gina Rinehart, says that’s the technique it intends to employ — and in a joint federal-provincial hearing no less.

Last week, the Kenney government told the Narwhal in a series of emails that open-pit mining can’t be called mountaintop removal if it only removes, say, 90 per cent of a mountaintop.

By Alberta’s definition, the top of the mountain has to be “completely” removed to qualify as mountaintop removal.

The Alberta Energy Regulator and Kenney spokesperson Kavi Bal both informed the Narwhal that open-pit mining can scrape off the sides of a mountain, devein coal seams and leave a ridge a pockmarked shadow of itself after removing tonnes of toxic debris, and that’s OK: because it’s open-pit mining, and not mountaintop removal.

…click on the above link to read the rest of the article…

 

Achtung Baby! (It’s Cold Outside) – Germany’s ‘Green’ Energy Fail Rescued by Coal and Gas

Achtung Baby! (It’s Cold Outside) – Germany’s ‘Green’ Energy Fail Rescued by Coal and Gas

Barely a week after Davos luminaries met with world leaders and Silicon Valley oligarchs to plot their latest phase of the Great Reset, the underlying provenance of their entire ‘climate emergency’ thesis is still struggling to correspond with reality.

Their much-celebrated “Zero Carbon” agenda which virtue-signaling leaders like Justin Trudeau, Boris Johnson and Joe Biden are currently advocating for – is proving to be a lot more difficult to achieve in reality than it is on their elaborate UN Agenda 2030 Powerpoint slides, computer modeled projections and Zoom calls.

No one is being hit with this sobering reality more than the Europe’s premier green trailblazer, German Chancellor Angela Merkel, whose country is currently in the grips of Europe’s record-breaking freeze this winter.

Stop These Things reports…


Germany’s held up as the world’s wind and solar capital. But, at the moment, the ‘green’ stuff can’t be purchased, at any price.

Its millions of solar panels are blanketed in snow and ice and breathless, freezing weather is encouraging its 30,000 wind turbines to do absolutely nothing, at all. [Note: don’t forget about the constant supply of electricity from the grid that these things chew up heating their internal workings so they don’t freeze up solid!]

So much for the ‘transition’ to an all wind and sun powered future – aka the ‘Energiewende’.

Despite being the object of consternation and much vilification over the last 20 years, Germany’s coal-fired plants are now being appreciated for what they are: truly meaningful power generation sources, available on demand, whatever the weather. With a Nationwide blackout a heartbeat away, the German obsession with unreliable wind and solar is like a time bomb set to explode.

…click on the above link to read the rest of the article…

 

Critics Skeptical as Alberta Reverses Course on Open-pit Coal Mines

Critics Skeptical as Alberta Reverses Course on Open-pit Coal Mines

Five days after Kenney defended the province’s mining push, the government says it was all a big mistake.

After months of ignoring a grassroots protest movement opposing plans to allow open-pit coal mining in Alberta’s Rockies, Energy Minister Sonya Savage said today the provincial government made a mistake and is now prepared to fix it.

In a brief news conference, Savage said the province would reinstate the 1976 Coal Policy, which prohibited open-pit mining on 1.5 million hectares of “Category 2” lands in the eastern slopes of the Rockies.

In addition, Savage said she had instructed the Alberta Energy Regulator that “no mountain top removal will be permitted” in the province and that all future coal exploration on the Category 2 lands will be paused indefinitely until public consultation is held.

Coal exploration by Australian miners on six existing leases in the foothills will not be paused.

Savage’s reinstatement of the Coal Policy directly contradicts statements from Premier Jason Kenney on Wednesday that the Coal Policy was a “dead letter” and obsolete.

The highly unpopular premier also characterized opponents of coal mining as urban snobs even though the majority of the opposition has come from his party’s angry base: ranchers, farmers, landowners and rural towns and municipalities.

The government’s abrupt change of course follows weeks of protests from hundreds of thousands of Albertans from all walks of life and all political parties.

They raised concerns about water security, selenium pollution (a legacy of open-pit coal mines), and the future of the province’s iconic eastern slopes.

Landowner and conservation groups greeted today’s announcement with skepticism.

…click on the above link to read the rest of the article…

Olduvai IV: Courage
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Olduvai II: Exodus
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