It still doesn't get away from the fact that if Australia went to 100% renewable energy tomorrow and ceased mining and selling coal to the rest of the world immediately, that the actual impacts on overall global warming would be virtually zero.
Australia has 16 coal power stations currently, with plans to build no more.
However, in the rest of the real world, there are currently plans to build a further 1600 coal power plants. Yes...that's 1600...100 times more new coal power plants than Australia has in it the entire country.
https://www.nytimes.com/2017/07/01/climate/china-energy-companies-coal-plants-climate-change.html
We might think we're important, but in the grand scheme of things we have f**k all influence and if we choose not to allow the mining and selling of coal for these 1600 new power plants, well they will just mine and buy it in another country. It's a global market and if someone goes out business, they just find it from someone else.
Whilst people continue to make money out of coal fired power, then people will continue to mine and sell coal.
Climate Change policy has got to be a global one-in-all-in concept, or we're really just taking the piss.
Yes but Australia are not planning to shut down all coal powered generators tomorrow nor are they planning on quitting exporting of coal. They are (hopefully) moving towards meaningful targets to transition to a larger mix of non-coal power generation. It is possible refer UK. They started their coal powered scale down over a decade ago.
If Australia waits for an all in approach, it will never happen. We and other climate responsible countries need to take the lead and force non-compliant countries into also making the change. The EU are moving forward as are the UK, New Zealand and Canada. Even our small pacific neighbours are transitioning to renewables.
https://reneweconomy.com.au/10-pacific-island-nations-rets-much-ambitious-australia-45562/
Here is an international reflection on our transition to renewables.
The inevitable decline of Australia’s coal generation
By Leonard Quong at
Coal generation has long been the bedrock of Australia’s electricity supply, providing abundant, cheap baseload power to consumers. But the fleet is ageing and is faced with a series of economic battles for its long-term survival – battles the coal plants are unlikely to win.
Introduction
Age, and the effects of it, are at the heart of the problems facing Australian coal-fired generators. With an average age of 29 years, compared to a design life of between 40 and 50 years, Australia’s coal fleet is ageing. By 2050, nearly all of the country’s 25GW of coal capacity operating today will reach the end of their technical life, with almost 50% reaching this point between 2030 and 2040. Since 2016, already 2.8GW of coal capacity has retired due to old age or after encountering market conditions they were not designed to operate in.
Figure 1. Australian coal capacity with closure at end of technical life
(Source: BloombergNEF)
With demand for electricity expected to continue growing, any gap in electricity supply left by retiring coal projects has to be filled. The rapidly changing economics of generation, and needs within the system, will determine Australia’s future generation mix.
Coal unlikely to fill supply gap
There are three main ways to fill the inevitable gap in supply left by retiring coal: i) build new coal plants, ii) life-extend the existing plants as they age, or iii) build something else.
Building new coal
Despite an abundance of coal reserves in Australia, building a new coal-fired power station is one of the most expensive forms of electricity generation. The market views building new coal as an extremely risky prospect. As a result, investors and debt providers demand a significantly higher rate of return for investments in coal projects. The three main risks are:
- Carbon risk: Since the repeal of the Carbon Tax in 2014, Australia has lacked any long-term, robust, national decarbonization policy. Investors worry that any future policy or decarbonization mechanism will strand investments in new coal.
- Market risk: The volatile nature of Australia’s electricity markets leaves coal generators particularly exposed to rapidly fluctuating electricity prices, changes in demand dynamics, and fuel prices increasingly linked with international commodity markets.
- Risk to reputation: Many Australia-based companies are reluctant to support any green-field coal plants due to increasing environmental, social and governance exemplarity expectations (and at times demands) from consumers, investors and shareholders. Already, most large domestic banks have ruled out financing any new coal projects in the country.
Due to these factors, there is very little appetite for any new coal generation projects within Australia’s investment community. Prospective developers struggle to de-risk projects and maintain a viable business model over the life of the project without relying on generous government support schemes (where none yet exist).
Life-extending coal
Extending the lifespan of a coal plant refers to investing new capital into an existing project to keep it operating beyond its initial end-of-life. Each plant will require different investments to continue operating, but even so the ability to life-extend Australia’s coal fleet is limited. Two asset owners, AGL Energy and Origin Energy, have already committed to closing down the coal plants they own at the end of their life – ruling out extending any of these projects. While this might not sound too significant, between the two them, these companies own 39% (10GW) of Australia’s existing coal capacity.
About 8GW of the existing fleet would face severe economic barriers to having their operation extended, according to our analysis. These barriers include poor plant conditions, limited access to fuel supply, limited waste disposal options, or simply an inability to extend environmental permits. The poor condition of the coal fleet is also causing plants to trip, a technical failure that is more likely to happen during episodes of extreme heat that are increasingly frequent. For example, on January 18, 2018, the 500MW Loy Yang B plant, Australia’s youngest lignite power station, tripped whilst supplying around 6% of the state of Victoria’s power demand. The gap in supply was successfully compensated for by the system but these episodes are challenging the portrayal of coal plants as the most, or even only, reliable source of electricity by supporters of the sector in Australian politics.
Taking into account company commitments and poor life-extension economics, only 7GW of coal projects operating today stand to be life-extended. Even if each of the projects that have any reasonable potential for a 15-year extension got one, there would still be a significant gap in supply left by retiring coal (Figure 2).
Figure 2. Australian coal capacity with closure at end of technical life with possible life extensions
(Source: BloombergNEF)
Build something else
A mix of renewables, along with other flexible technologies, will be the most likely source of new generation in the market as coal projects retire. For years now, building new renewable generation has been the cheapest source of new electricity supply in Australia. Currently new large-scale wind or solar generation costs around A$55-90/WMh to build in Australia, with future costs expected to continue to decline.
Figure 3. Levelized cost of generation
(Source: BloombergNEF)
Operating coal is cheap, but building new coal is one of the most expensive sources of new generation, at around A$190/MWh, taking into the cost of capital expected by investors. The cost of life-extending coal projects is more uncertain, with each project requiring a different amount of re-investment to continue operating. Our analysis suggests that projects reasonably placed to life-extend could do so for around A$81/MWh.
When coal plants retire, there will be no perfect solution to plug any gaps in supply. The market will have to rely on price signals and perceived risks to determine the optimum mix of higher usage of existing assets, building new low cost generation, and flexible capacity.
