The Indian government has approved a new mechanism for commercial coal mining under which any entity — even without any prior expertise or qualification — will now be eligible to mine coal. The directive is aimed at boosting the country’s domestic coal output and will offer 50 new blocks to commence operations with immediate effect. Furthermore, the Centre will also switch from a fixed charge per tonne model to a revenue sharing model to attract more players and bring transparency to the process.
However, India is also weighing its support towards coal gasification and liquefaction to reduce the fuel’s overall climate impact, and to gradually build its stake in a ‘gas-based economy’.
On the other hand, the Power Finance Corporation (PFC) and Rural Electrification Corporation (REC), two of India’s largest public sector lenders, continue to lend huge sums to new coal power plants despite their tariffs already being 60-70% higher than the average renewables’ tariff of ₹2.5-2.8/kWh.
As of December 2019, PFC and REC together had lent ₹343.746 crore (~$49 billion) — 54% of their spending — to coal plants, which in turn has increased the share of non-performing assets on their balance sheets to ₹47,454 crore (~$6.8 billion). The two firms also together financed all of the 8.8GW of India’s new coal capacity, even though IEEFA has questioned how they expect to recover their investment in light of the mounting challenges.
India’s coal PLFs plummeted to 42% under COVID-19, may stay below 53% for FY21
The average plant load factor (PLF) for coal plants in India dropped by nearly 22% year-on-year to go from 63.1% in April 2019 to 41.9% for last month. The sharp drop is due to fall in power demand over the country-wide lockdown, and private coal plants have suffered the sharpest decline as their average PLF was down to a mere 44%. Government-owned plants, such as NTPC’s, fared better at 49.9% — even though that too was a drop of 22.6%.
The PLF for Adani’s Mundra plant dropped from 84.7% to 51.6% and for Tata’s Mundra unit, the figure shrunk nearly 20% to come down to 61.4%. The numbers highlight the precarious health of coal power plants in India, and to put it into context, the lowest PLF ever recorded in India was during 1985-86, when it stood at 52.4%. Going forward, CARE Ratings estimates that the national average PLF will stay below 53% for FY21 due to lower economic activity and the expanding share of renewables.
Spain’s proposed net-zero law could ban all new coal, oil and gas projects
The prime minister of Spain has proposed a new net-zero law that, if passed, would immediately ban all new coal and oil & gas projects in the country. The draft bill is currently with the Spanish parliament and may be passed before the end of 2020, following which targets such as ending direct fossil fuel subsidies, switching to 100% renewable energy by 2050 and even using alternative fuels for aviation will become mandatory. Interestingly, the country may also introduce the subject of climate change in its school curriculum.
OIl Change International: G20 funneled $77 billion to oil & gas every year since 2017
Oil Change International’s latest analysis has found that $77 billion were funnelled to oil and gas projects around the world by the G20 nations every year since 2017, despite their climate commitments in light of the Paris Agreement. The quantum is still three times as much as that going to renewables, and is mostly handed out via govt. backed loans and guarantees to corporations or under the garb of developmental projects.
Also, the report highlights three important findings: that China, Japan, South Korea and Canada were the worst offenders — together accounting for $50 billion a year, that because the channel differs from the roughly $80 billion a year in fossil fuel subsidies, the financing is harder to track, and that large drillers, under the media attention on Covid-19, were buying out smaller oil and gas firms to consolidate their market shares before oil prices stabilise.
Australia’s new emissions reduction plan to fund coal and gas through clean energy fund
Australia has unveiled a new climate action plan to meet its Paris Agreement obligation by 2030, under which the county will prioritise carbon emissions reduction while staying away from setting a price on carbon. The country has the highest CO2 emissions per capita at around 17 tonnes/person, and the plan comes after a review of its Climate Solutions Fund, which will use the money to not switch fully to renewables. Instead, it will finance the yet unproven approach of carbon capture and storage (CCS), while simultaneously exploring more power through coal and natural gas.
However, the review does recommend that 200 of Australia’s biggest industrial facilities, which together account for 25% of the country’s emissions, be given credits for fast-tracking emissions reduction. These could then be purchased by other businesses. Individual households may also be made to disclose their energy efficiency figures.
Greenpeace exposes advanced cloud computing for BIg Oil, only Google offers exit
Greenpeace USA’s latest report has exposed how some of the largest tech firms have won billions of dollars worth of contracts to assist oil and gas drillers optimise every stage of their operations through cloud computing and AI. The report shows how Microsoft, Google and Amazon are using advanced, AI-assisted analytics to help the drillers find deposits around the world and extract them at lower costs.
Big Oil is expected to spend around $15 billion on the service over the next decade, while Accenture estimates that cloud computing’s advances could help it generate as much as $425 billion in revenue by 2025. Yet, the practice highlights how the tech giants, even though they are publicly committed to going carbon-neutral and/or zero-carbon — mostly within 20 years, continue to profit from the very industry they are distancing themselves from.
However, while Google has issued a statement that says it will not assist any such services to the sector (but honor its existing contracts), Microsoft, in an oblique statement, has stated that it will remove all the carbon it has ever emitted from the air by 2050. Amazon, meanwhile, has stressed that ”the energy industry should have access to the same technologies as other industries.”
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