Guest essay by Eric Worrall
Although investment in coal plants has slowed to its lowest level this century, the coal fleet is still growing.
Global energy investment stabilised above USD 1.8 trillion in 2018, but security and sustainability concerns are growing
14 May 2019
Global energy investment stabilised in 2018, ending three consecutive years of decline, as capital spending on oil, gas and coal supply bounced back while investment stalled for energy efficiency and renewables, according to the International Energy Agency’s latest annual review.
The findings of the World Energy Investment 2019 report signal a growing mismatch between current trends and the paths to meeting the Paris Agreement and other sustainable development goals.…
Still, even as investments stabilized, approvals for new conventional oil and gas projects fell short of what would be needed to meet continued robust growth in global energy demand. At the same time, there are few signs of the substantial reallocation of capital towards energy efficiency and cleaner supply sources that is needed to bring investments in line with the Paris Agreement and other sustainable development goals.
“Energy investments now face unprecedented uncertainties, with shifts in markets, policies and technologies,” said Dr Fatih Birol, the IEA’s Executive Director. “But the bottom line is that the world is not investing enough in traditional elements of supply to maintain today’s consumption patterns, nor is it investing enough in cleaner energy technologies to change course. Whichever way you look, we are storing up risks for the future.”
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Even though decisions to invest in coal-fired power plants declined to their lowest level this century and retirements rose, the global coal power fleet continued to expand, particularly in developing Asian countries.
The continuing investments in coal plants, which have a long lifecycle, appear to be aimed at filling a growing gap between soaring demand for power and a levelling off of expected generation from low-carbon investments (renewables and nuclear). Without carbon capture technology or incentives for earlier retirements, coal power and the high CO2 emissions it produces would remain part of the global energy system for many years to come. At the same time, to meet sustainability goals, investment in energy efficiency would need to accelerate while spending on renewable power doubles by 2030.
Read more: https://www.iea.org/newsroom/news/2019/may/global-energy-investment-stabilised-above-usd-18-trillion-in-2018-but-security-.html
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Energy companies must be aware they are not building enough capacity, but given the political uncertainties around subsidies for renewables, regulatory hostility towards nuclear and the looming risk of carbon taxes being imposed on fossil fuel generators, their decision to withhold new investment is economically rational.
Whether power companies make money from new capacity, or cash in when shortages spike energy prices, either way they win. It is up to politicians to fix the horrendous mess their renewable policies have created, and restore a stable energy market which encourages investment in capacity.
Kind of highlights the fact that you can’t “divest” unless someone who didn’t flunk arithmetic in second grade is willing to invest.
Warren Buffett’s $10 Billion Berkshire-Hathaway investment in the Occidental buyout of Anadarko should tell the GreenSlime lobby they are losing, and losing big time.
https://www.marketwatch.com/story/berkshire-hathaway-commits-to-10-bln-equity-investment-in-occidental-to-buy-anadarko-2019-04-30-891597
Buffett doesn’t throw his money away. He’s never been into virtue signalling. Just where the smart money plays are. And Anadarko is one of the big Permian Basin players.
A Bucket of ice cold water that should be to the Greenie wind and solar mavens.
Buffet bought Burlington Northern and Santa Fe when Obama was elected. He knew about (ordered?) Obama’s blocking of new pipelines and figured, correctly, that the oil would have to be hauled by BNSF instead.
Buffet always said, quietly, to build the pipelines.
But, he supports the pols who block pipelines.
Warren is no fool.
Duh.
So-called “Green” technology has not kept pace with renewable drivers nor sustainable demand.
Grid black-outs, brown-outs, and consumers revolting from high utility bills.
That will be the result of “overreach”.
And the Green-slime renewable energy lobby is in danger of overreach now. And overreach and believing their own lies will be their un-doing. That what happens when fantasy meets reality; reality always wins.
Except in developed countries with 33% or 38% renewable electricity, like the UK and Germany, the grids are enormously stable… massively more stable than the USA
Which has to do with what, Griff?
If by stable you mean flickering lights, frequent short term disruptions, and sky rocketing costs then yes, Germany has a very stable grid.
And the cost of preventing the UK grid from collapsing has increased massively in line with the increase in windmills and solar, and will keep rising, and people will wonder why their bills keep increasing when wind and solar are allegedly free.
Genuine questions here, Griff. If renewables are cost-effective and can provide reliable baseload, why are the developing nations building coal plants? Why wouldn’t they go with something cheaper, if renewables are less costly? And how can Germany claim a stable and green grid if it has to pay to export power some days, and relies on coal for baseload to keep the grid running on most other days?
Although I usually disagree with you, I am glad you are on this site to challenge groupthink and break up the echo. I learn a lot from the non-snarky responses to your posts.
So many lies griff.
1) To get to 33% you are relying on name plate capacity, reality is that none of those countries come anywhere close to that number day in and day out.
2) As has been explained to you countless times, those countries are only stable because none of their neighbors has swallowed the kool-aid to the same extent. They use the reliable grids of their neighbors to keep theirs stable, but at great cost.
3) More stable than the US, care to actually document that claim? Or are you just making up another claim now that your old ones have been refuted?
I call BS.
Age 63, having lived in 5 states I have NEVER experienced a blackout or even a brownout not associated to a power line down due to weather or accident.
The necessary electrical power has always been available to my home and or where I was working. How more reliable does a system need to be?
BTW, where I live now is on a mountain with only 1 high power line supplying the area. I have installed a backup generator for times when that line or other distribution lines nearer my cabin go out due to downed trees due to weather. That happens 2 or 3 times every winter. Temps get down to – 10 F sometimes so I need to keep the place warm enough to keep the plumbing from freezing. It is sort of cool to be the only house in the area with the lights on. Other full timers have put in generators in the last few years.
Why only 1 line. US envirowackos in the forest service have been blocking, for years, installation of a second line across national forest land. Why, because of the blight of the power line in pristine unblemished forest. Bet Griff’s buddies would be allowed to build their bird choppers if the area was suitable. Thank God it is not.
BTW #2: I still have snow on property due to recent storms and may get 2 to 6 inches more over the next few days. We have gotten snow on Memorial Day weekend several times in the past but it was always gone the same day. At 8600 ft elevation, on May 22, I can look across the valley at snow covered hills. Been coming here 14 years, this is a first. As I posted in another thread, people who were up here 35 years ago speak of regular snowfalls happening on the 4th of July or thereabouts. I have yet to experience that.
The Snotel site at Midway Valley 10 miles away and 1000 feet higher still has 2 more inches of snow water equivalent now than the 1981 to 2010 median peak which happens about April 7th, 6 weeks ago. Last night it got down to the mid 20s again, 4th or 5th day in a row, 2 more nights before the nighttime temp is to be over 30 F.
Return of a cycle of colder weather? We shall see.
Germany’s grid is stable because today they are burning more lignite and can import electricity from nuclear-dominated French sources. But if they shut down those coal plants, then they’ll become Putin’s puppet because of Nordstream 2 gas reliance.
Probably the most vulnerable grids in the US remain the NorthEast where bad policy and planning is limiting pipelines to bring in natural gas to replace closed nuclear plants.
Progressive policies in reality bring about the very thing they say they are opposed to.
Look at gridwatch.co.uk.
Very interesting what you get for 9,500 windmills with a capacity of 20GW.
Note they are burning woodchips from the USA and calling that biomass and therefore renewable. Since they burn biomass 24/7, that accounts for a large amt of their renewable energy over the course of a year. This biomass energy is stable, just as stable as burning oil or coal.
Note that in England the hookup fee for electricity is about 90 US dollars per month, and the charge per KwH is about 18 cents. That would easily double my electricity bill here in MD. My bill last month was 80 dollars total.
Note that Nautural Gas supplies more than 1/2 of their energy now that they have closed most of their cold plants. They import 55% of their natural gas.
Note they don’t use much oil, either.
Note they import a lot of energy from France and Holland.
Joel – you may have confused months and years for the fixed charge in the UK. Average electricity bills (combining fixed and variable elements) in the UK are around £50/month so not far from your $80
Err, did you work out the UK has 33-38% renewables?
Stable grid in Germany? https://www.powerengineeringint.com/articles/2018/01/more-renewables-mean-less-stable-grids-researchers-find.html
Amen, Eric.
Meanwhile coal exports from Australia have hit new records. China thought it would make “delays” in accepting Australian coal as punishment for blocking huwawa 5G equipment. That worked out real well with Japan and South Korea taking record levels of coal from Australia and pushing coal prices up and the market only now has returned to normal levels.
The cool thing about coal, unlike oil and natural gas which require careful planning and investment for storage, is it can be stockpiled in massive open piles near generation plants at little cost. So why wouldn’t Japan and SKorea take advantage of a price-supply opportunity? A no brainer.
And, following the Australian elections, the Queensland government has caved in and will now allow huge new coal mines to be developed. The world is returning to sanity.
Speaking of U.S. methane emissions, they apparently are basically flat since 2006 despite increased oil & gas activity. Previous studies made incorrect assumptions around methane to ethane ratios and therefore overestimated emissions.
https://cires.colorado.edu/news/us-methane-emissions-flat-2006-despite-increased-oil-and-gas-activity-study
No company deliberately wastes a product that can be sold at a profit.
This is something that few leftists have been able to grasp.
Every coal, natural gas and nuclear electrical power plant that closes under the green agenda must be matched be an equal (plus 25% to match future demand) renewable, dispatchable and reliable capacity.
If not, don’t close (or replace with dispatchable and reliable alternatives) unless you want to close your economy and live in the dark and cold.
This must be a condition of closure.
Nuclear power is the only serious alternative to fossil fuel power that can meet future demand. Population stabilization would help to stabilize energy demand and gradual population reduction could gradually reduce energy demand. More than 200 years ago mankind’s fossil fuel use was trivally small. I doubt that many want to go back to fossil fuel free technology and give up 200 years of technology. The old fossil fuel free technology cannot support today’s modern cities and high population densities.
Old technology is an interesting subject;
Wind for shipping.
Horse and cart.
Wind for grinding mills.
Water wheels for smiths.
Scythes for wheat and sugar harvesting.
Stump jump plows behind a dray of oxen for farming.
Dynamite for digging a hole.
Wood and stone for bridges.
Wood and stone for buildings too, which means 6 stories maximum height once again.
“Population stabilization would help to stabilize energy demand and gradual population reduction could gradually reduce energy demand.”
It seems that affluence causes human populations to decrease. I saw an article the other day that said even the Chinese are now experiencing lower birthrates, to the point that Chinese officials are worrying about it and are trying to encourage the Chinese people to have more children.
Providing affordable electricity to the people of the world may solve a whole host of potential problems.
BET the farm on that and you may end up owning one more “stranded asset”*. _Do_ take a look at what progress Dr. Mills has made towards harnessing Hydrino tech, IF you care to do full due diligence in the energy sector, especially if your investment target is one that requires a big initial investment and years to pay off …
.
.
*stranded asset – an asset that has become obsolete or non-performing, but must be recorded on the balance sheet as a loss of profit.
You mean like the Ivanpah solar installation?
re: “You mean like the Ivanpah solar installation?”
Has it turned from asset to liability? (Was it ever productive to start with? I never studied it.)
Economic suicide is not a viable solution for people that want very much to live, love, learn, and send their progeny forward into a prosperous future. Coal and all fossil fuels are an essential part of that ‘progressing’ future. Ironic that conservatives are the ones driving this continued progress, isn’t it?
A serious attempt to reduce CO2 and provide long term reliable power (not the same issue) will need nuclear energy.
Meanwhile the only nuke plant in Washington State (Columbia Generating Station ) shut down for 40 days of refueling, maintenance, and upgrade. About the 3rd week of June it is expected to be back with greater output.
Australian Govn’t creates a situation whereby power generators and retailers are forced to generate power from renewables and retailers are obliged to sell that power in preference to coal and gas and now this;
https://www.smh.com.au/business/companies/liddell-must-be-extended-or-replaced-minister-warns-power-companies-20190522-p51q5g.html#comments
Oh dear!
The politicians and ‘activists’ may be able to fool the most gullible members of the society when they “fake it” but they will always play hell when trying to fake it to try to fool the laws of physics.
Been wondering how Shell Energy in the UK can possibly put a commercial on tv which states that their electricity is from ‘100% renewable sources’…..
Who do I sue..?
The ‘small print’ tells you that they purchase renewable electricity certificates equivalent to all the electricity they sell you. Frankly even I as a strong supporter of renewables have my doubts about whether that counts!
“Although investment in coal plants has slowed to its lowest level this century, the coal fleet is still growing. ”
Are coal investments really slowing? From the New York Times in 2017:
” 1,600 coal plants are planned or under construction in 62 countries..”
https://www.nytimes.com/2017/07/01/climate/china-energy-companies-coal-plants-climate-change.html
It is a profound mystery to me how some people can be afraid of the world running out of fossil fuels because they’re not “sustainable,” while being simultaneously afraid that we won’t convert to new energy sources.
Regarding the r e-election of the Morrison Govt. in Australia a, a Labour Premier er in the Northern state of Queensland had suddenly decided to approve the Adani mine.
This is a classic case of tell one lot of voters what they want to hear, then via her deputy to tell the green voters what they want to hear.
With a Queensland election coming up next year the ALP politicians sniffing the political breeze, have decided to approve Adani.
Mind you the Greens will now search for a tame Aboriginal to object on the grounds of holy land or some tiny creature will be endangered.
And despite Adaani being hundreds of km (miles) from GBR, their moving the coal to port s will endanger the reef.
When it comes to how to skin the cat, the greens have it well covered.
MJE VL5ELL
Looks however that other Oz coal projects are not going ahead and future of coal exports far from certain…
https://www.theguardian.com/environment/2019/may/23/galilee-basin-mine-next-to-adani-put-on-hold-amid-doubts-over-future-of-thermal-coal