The coal ministry recently launched an auction of 29 coal blocks for commercial mining to enhance the average dry fuel output by an additional 7% in the next two years, as the combined peak rated capacity (PRC) of these reserves is around 91 million tonnes. The auction of coal reserves for commercial mining in the sixth round and the second attempt of the fifth round on November 3, 2022, was launched with the aim of starting production by 2024-25.
Coal returns to CPEC, puts a cloud over China’s climate pledges
A long-stalled coal 300 MW coal power plant linked to the China-Pakistan Economic Corridor (CPEC) in Pakistan’s port city of Gwadar was finally green-lit by the government of Pakistan. The project will be financed and built by Chinese state-run entities. The coal power plant, which was conceived seven years ago, was halted as the Pakistani government, which was keen to renegotiate original terms of the agreement with China to change the location and shift to domestic coal from imported coal. Pakistan’s ongoing economic crisis, however, seems to have weakened this resolve with the government reportedly retracting these demands. The move brings fresh scrutiny on China’s role in the project, given the country’s 2021 pledge at the UN General Assembly to not build any new coal-fired power plants abroad.
In related news, the Chinese embassy in Islamabad is reported to have asked the Pakistan government to release overdue payments of about $1.5 billion to Chinese-run power plants in the CPEC.
EU open to support fossil fuel phaseout before COP28 approaches
Ahead of the COP28 climate summit, the European Union (EU) agreed to promote a global fossil fuel phase-out, in an attempt to boost a global deal that failed last year. A text on the diplomatic priorities was approved by ministers from the 27 EU member states in order to give a push to using renewable energy or energy savings—rather than fossil fuels—to replace Russian energy. “The shift towards a climate-neutral economy will require the global phase-out of unabated fossil fuels. The EU will systematically promote and call for a global move towards energy systems free of unabated fossil fuels well ahead of 2050,” the EU text said.
EU expected to extend natural gas consumption cuts by another year
This week, the European Commission put forward a proposal to extend the ongoing cut in the bloc’s natural gas demand by 12 months. The 15% cut was put in place last year as a response measure following Russia’s “special military operation” in Ukraine. Extension of the emergency measure, to be decided on March28, will see cuts persist at least until the end of the 2023/2024 winter heating season. Although a milder-than-expected winter saw high levels of reserves across the EU, the European Commission expects a tight natural gas market amid challenging macroeconomic conditions and potential weather extremes.
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