Plans For Coal-Fired Power Plants Drop By Almost Half In 2016


2016 saw a “dramatic” decrease in the number of coal-fired power stations in pre-construction globally. The authors of this study say there was a 48% fall in planned coal units, with a 62% drop in construction starts. The report, from claims changing policies, several green campaign groups and economic conditions in India and China were behind the decline. However, the coal industry debates the fuel will remain essential to economic growth in Asia for decades to come.

‘Rapid Swing’

Between 2006 and 2016, China and India together accounted for 85% of the coal plants built across the world. But according to the Boom and Bust 2017 report, put together by Greenpeace, CoalSwarm and the Sierra Club, there has been a huge swing away from coal in these two countries in just 12 months. The main causes of the decline are the imposition of restrictive measures by China’s central government with the equivalent of 600 coal-fired units being put on hold until at least 2020. According to the authors, the Indian go-slow was prompted by the reluctance of banks to provide funds. Work at 13 locations is currently not going ahead.

However, there have also been significant retirements of coal plants in the US and Europe over the past two years, with roughly 120 large units being taken out of commission. Ted Nace, director of CoalSwarm said, “This has been a very messy year and an unusual one.” “It’s not normal to see construction frozen at scores of locations, but bankers in India and central authorities in China have come to recognize overbuilding of coal plants as a major waste of resources. “However abrupt, the shift from fossil fuels to clean sources in the power sector is a positive one for climate security, health and jobs. And by all indications, the shift is unstoppable.”

The study comes as other groups analyze the potential for investments in coal to become stranded assets if governments continue to restrict CO2 emissions. The International Energy Agency (IEA) says that hundreds of billions of dollars could be in danger. Paul Massara, now of North Star Solar but a former CEO of RWE Npower said, “The decline in new coal plants in Asian countries is truly dramatic, and shows how a perfect storm of factors is simply making coal a bad investment.”

He said, “Growing alertness of the air pollution problems coal causes, the impact of policies to tackle climate change, and the cost-competitiveness and rapid growth of renewable sources of energy, along with rising battery technologies, are making new coal plants redundant before they are even built.” However, the World Coal Association vehemently disagrees. It says the complexness of large infrastructure projects means that until they break ground, it’s no surprise if they don’t go ahead.

According to the authors of the study, the slowdown brings the possibility of keeping global warming under 2 degrees Celsius since pre-industrial times “within feasible reach.” However, the study says that much more progress needs to be made to reduce the number of coal-fired plants under development in Japan, Vietnam, Indonesia, Turkey and elsewhere.