The EU’s decision to extend sanctions and ban Russian coal imports into the bloc over alleged war crimes in Ukraine’s Bucha is likely to sharpen the sting of rising energy and commodity prices in the region. The bloc imports EUR 4 billion worth of Russian coal each year, but the decision may be passed despite energy costs already rising in the EU nations over the political situation with Ukraine. The pulling back from Russian coal imports will likely be followed by further sanctions on other goods, such as Russia-made chemicals, rubber and oil and gas.
The German Chancellor, Olaf Scholz, also supported the potential ban and said his country would need around four months (120 days) to wean itself off of the imports, even though it may lead to some shortages in the short term. The EU’s decision was followed by Japan’s announcement to do the same in its diplomatic stance against Russia’s military aggression against Ukraine. However, a date for the same was not announced as 13% of the country’s coal consumption comes from Russia. The energy crisis in Europe has prompted European states to reopen coal projects that were set to be retired. While Germany was the first to hint at restarting coal operations to tide over short-term energy shortages, Greece has now also announced that it would be ramping up coal mining in the country as geopolitical tensions force the bloc away from their erstwhile commitments towards decarbonisation.
Coal shortages bear heavy on India’s power supply
According to latest data collated by The Hindu, more than 100 power plants in the country have coal stocks that have fallen below the critical mark of 25%, while more than 50 have seen stocks fall below 10%. The protracted supply crunch of coal, which is the second in six months, has scuppered power supply in several parts of the country as coal continues to meet almost 70% of India’s energy demand. Following distress signals from power producers and suppliers, Coal India Limited is scrambling to ramp up supplies, which it says is currently 14.2% higher than it was during the same period last year. The company added that it had raised its production to 26.4 million tonnes during the first half of April- a 27% year-on-year growth. Additionally, CIL announced that 8.75 MTs of coal will be made available to state and Central generating companies by the end of May to help tide over the shortage.
China grants licence to new coal mine that could run for 97 years
The Chinese government granted a licence for a new coal mine — the Baijiahaizi mine in Ordos, Inner Mongolia — that could run for an estimated 96.8 years at an annual extraction rate of 15 million tonnes. The mine started operations in 2019 but the licence now makes its operations legal and it holds 2.03 billion tonnes of fuel. The region itself is China’s biggest in terms of annual coal output and is on pace to extract 1.18 billion tonnes of the fuel by the end of 2022.
India: Coal demand may grow by 63% by 2030 but govt may lower coal power’s share to 30%
India’s new draft Economic Survey 2021-22 showed that the demand for coal in the country may grow by 63% by 2030 to reach 1.3-1.5 billion tonnes annually, which would imply that there would be no case for a transition away from the fuel in the near future. The findings of the survey were presented to the Rajya Sabha, but at the same time, the Ministry of Power will attempt to slash the share of coal power in the country’s energy mix to 32% (down from 52%) by 2030. The statement comes as the Ministry is reportedly ramping up its support for renewables over their very low tariffs — a low as Rs. 1.99/kWh for solar — and its support to the “Go Electric” campaign to provide cleaner power to India’s growing fleet of EVs.