September 13, 2017 / 2:47 PM / a month ago

Coal's problem is not climate change: Kemp

LONDON (Reuters) - U.S. coal companies blame climate campaigners and the Obama administration for waging a war on coal that has cost thousands of jobs and threatened struggling mining communities.

A worker walks at a coal storage site near a freight station in Shenyang, Liaoning province October 18, 2010. REUTERS/Sheng Li

But coal’s long-term problems stem not from politics but from physical properties that make it an inferior source of energy compared with oil, gas and (arguably) renewables.

Coal has been losing the “war” for market share since the middle of the 20th century as other sources of energy have become cheaper and more abundant.

Rising energy consumption in advanced economies and emerging markets masked coal’s relative decline in the second half of the 20th century and first decade of the 21st.

But as energy consumption has reached a plateau in developed countries, coal demand has started to decline in absolute and relative terms in the more modern economies.

Consumption has continued to grow in poorer countries, where coal has played a crucial role in making electricity available for the first time to hundreds of millions of households.

But the same problems that ensured coal’s replacement in the advanced economies will gradually lead to its replacement in emerging markets as well.

ENERGY TRANSITIONS

Coal’s displacement by other sources of energy is part of a “grand energy transition” that has seen the dominant energy source shift successively from wood to charcoal, coal and oil.

The precise dates vary slightly from country to country, but coal started to become an important source of energy on a global scale just before 1850 (“Energy transitions: history, requirements, prospects”, Smil, 2010).

Traditional biofuels such as wood and corn stalks continued to dominate the global energy system until 1900, when they were finally overtaken in importance by fast-growing coal consumption.

Coal remained the dominant energy source until the 1960s, when it was overtaken by oil (“Global primary energy consumption, 1800-2015”, Our World in Data, 2017).

But in recent years, natural gas consumption has been growing faster, and gas is set to overtake oil as the single largest source of primary energy within the next decade.

Predicting transitions beyond natural gas is fraught with uncertainty but climate campaigners hope the global energy system will shift from gas to wind and solar.

A QUESTION OF PHYSICS

Each step in the grand energy transition has seen the dominant fuel displaced by one that is more convenient and useful.

The reasons for the original shift from traditional biofuels to charcoal and then coal are still disputed by scholars.

Wood was in short supply around major urban areas by the 17th and 18th centuries but it is unclear whether shortages were localized or becoming more general.

In any event, transporting larger quantities of wood over lengthening distances from increasingly remote forested areas to consuming cities was becoming a logistical problem.

The solution was to turn wood into charcoal, which was much more compact, and eventually to shift to coal, which was even more compact and easier to transport.

Traditional biofuels may have been becoming more scarce, but it was the increasing availability of coal and its decreasing price that drove the transition.

Coal was simply more useful as a source of energy than traditional biofuels. Once it became cheap enough, it rapidly replaced wood and agricultural waste in most uses.

The same process explains the gradual displacement of coal by oil during the 20th century and now by natural gas in the 21st century.

There is far more energy in one kilogram of refined gasoline (46 megajoules) or gas (54 megajoules) than in a kilogram of bituminous coal (24-35 megajoules), let alone wood (18 megajoules).

Because they are liquids or gases, crude, refined fuels and natural gas can be transported by pipeline, which is much cheaper than transporting solid fuels such as coal, especially over long distances.

Liquids and gases can also be piped around a power plant or transport system, while coal requires labor-intensive handling, which adds considerably to cost.

Oil and gas combust more or less completely while coal produces large volumes of ash and slag, which require expensive handling and disposal.

Finally, oil- and gas-fired engines and steam turbines can reach full power output in minutes, while coal-fired steam turbines and engines require hours of pre-warming.

COAL LOSES GROUND

Oil gradually replaced coal as the main fuel for shipping in the first half of the 20th century because oil took up less space on board, allowing ships to travel faster, further and carry more cargo.

Oil could be loaded more quickly and resulted in an enormous reduction in manpower compared with dirty and physically demanding coaling operations.

At the outbreak of World War One, almost half the crew on a typical British Royal Navy warship were stokers and trimmers needed to move coal around and fire the engines.

In 1913, 46,748 lower-deck ratings out of a navy-wide total of 97,000 were engaged in “driving the ship”, according to the navy’s own magazine.

Replacing coal with oil therefore resulted in an enormous saving in manpower (“The Royal Navy’s fuel supplies 1898-1939: the transition from coal to oil”, Brown, 2003).

By shifting from coal to oil, the number of stokers on a battleship could be cut from 260 to 110, according to officials (“The financial effects of adoption of oil fuels for new vessels”, Admiralty, 1913).

Similar practical advantages eventually encouraged the conversion of commercial shipping and the railways from coal to oil-based fuels.

Oil and gas were also much cleaner-burning and the shift played a crucial role in cutting urban smog as well as around railways and ports.

COST AND SECURITY

The same practical advantages now favor the construction and operation of gas-fired rather than coal-fired power plants.

Gas-fired plants are cheaper and easier to build and require a fraction of the staff to operate (“Coal’s decline spreads far beyond Appalachia”, WSJ, 2017).

A coal-fired plant might employ 150-250 workers, while a gas-fired plant might need only 35, the Tennessee Valley Authority recently told the Wall Street Journal.

Gas-fired power plants do not require expensive emission control systems to capture fly ash and dispose of ash and slag.

Crucially, gas-fired power plants operate more efficiently and flexibly, and can ramp up and down quickly in response to changes in demand.

Set against these other disadvantages, coal’s primary advantage has always been its low cost and relative abundance.

Coal is cheap compared with oil and gas, and coal reserves are distributed more widely around the world.

Coal can be stockpiled to guard against a temporary interruption of supplies due to weather, industrial action or international conflict.

Coal has been available from a more diverse group of suppliers than oil and gas and there has never been a coal cartel to compare with OPEC.

For governments worried about energy security and affordability, coal has been an important part of their national strategy.

But coal’s residual role has always been vulnerable to any development that made oil and gas significantly cheaper and threatened its remaining competitive advantages.

In the 1950s and 1960s, U.S. coal producers came under pressure from cheap oil and the growing use of fuel oil for heating and power generation — until they were rescued by the oil shock of 1973/74.

Britain’s coal industry was eventually marginalized by the discovery of North Sea natural gas in 1959, which led to the replacement of coal first as a domestic heating fuel and then in power generation.

The same problem is now hitting coal producers in the United States and elsewhere as the shale revolution makes gas much more abundant and cheaper.

China and India will continue to be important and growing markets for coal, but there too governments struggling with smog are bowing to the physical reality and demanding cleaner sources of energy.

In the past, coal producers have pressed for protection when threatened by increased competition from other fuels.

In the 1950s and 1960s, U.S. coal producers lobbied to restrict the increase in fuel oil burning for heating and power production.

In 1950, the National Bituminous Coal Advisory Council complained Venezuelan residual fuel oil was being “dumped” in the U.S. market, harming national security (“Energy policy in America since 1945”, Vietor, 1984).

In the 1960s and 1970s, the UK coal industry lobbied to reserve gas as a “premium fuel” for domestic heating and cooking that should not be burned “wastefully” in power stations.

Something similar is occurring at present, with the U.S. coal lobby raising the prospect of subsidies for coal-fired power plants, but the tide of history is running against them.

Editing by Dale Hudson

Our Standards:The Thomson Reuters Trust Principles.
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