India, on its way to surpass China as the world’s largest coal importer, is taking another step to cut its habit.
The country’s power ministry plans to shut down aging coal-fired power plants with a combined capacity of 37 gigawatts of power, according to Bloomberg. These plants are at least a quarter-century old, wasting enough water and belching out enough air pollution that the government wants to replace them with more efficient units. The government did not give a timeline for either the shutdown sequencing nor the potential construction of newer coal plants. Yet even the most efficient coal plant will need water, which is a particular problem for India. This year some coal plants had to partially shut down due to lack of available water.
“Our first concern is emissions,” S.D. Dubey, chairman of the Central Electricity Authority, said. “We also want plants to be more efficient in use of resources.”
One reason India is so concerned about how much water its coal plants use is that it is grappling with drought and water security issues on a more and more regular basis. This year’s drought has been particularly bad, triggering crop failures, deaths, and other misery. A brutal heat wave has intensified the drought, conditions which can also charge up monsoon season, albeit with the accompanying threat of extreme flooding.
Coal plants also belch out shocking amounts of air pollution, which in India can make the skies dirtier even than the famously polluted skies of Beijing.
Coal accounts for about 62 percent of India’s nearly 300-gigawatt electricity capacity, and will dominate the grid there for the next couple decades. The government released rules in December attempting to cut water consumption and air pollution from the plants, and will be looking to make a roadmap to retire more coal. It also set the goal of 175 gigawatts from renewables by 2022, with most of that from rooftop solar installations. Last year, the government ordered the state utility to sell electricity from solar power along with coal power in order to expand the prevalence and affordability of solar power.
It wasn’t always going to be this way.
Almost one year ago, Bloomberg reported that India’s coal demand could jump by almost half, adding 124 gigawatts of electricity capacity by 2020.
“India thinks of coal … primarily as a poverty-fighting tool,” wrote Bloomberg reporter Eric Roston in 2015. “It’s the most vocal and influential champion of the fuel these days now that China’s industrial hangover has begun.”
But then things began to change.
Coal imports began to fall sharply in India at the end of last year.
“India was essentially the last flame of hope for the beleaguered seaborne thermal coal industry,” Tim Buckley, director of Energy Finance Studies at the Institute for Energy Economics and Financial Analysis, said in January. “Indian thermal coal imports look to have peaked in mid-2015, and are now set to permanently and rapidly decline.”
Part of this is due to a domestic coal boom, but a slew of other factors are also at play here: air pollution, drought, and most practically, economics.
The reason coal has occupied such a central part of India’s (and most of the rest of the world’s) electricity portfolio is that it has historically been the cheapest option. That’s not been so true recently.
“I think a new coal plant would give you costlier power than a solar plant,” India’s energy minister, Piyush Goyal, said in January. An auction that month showcased a record low price for solar energycapacity, which will be key to the calculus India uses to decide how much more coal to burn. Investors appear to be taking the hint, as more and more drop coal and look into solar.
In Paris last December, India said that it would cut coal if the rest of the world helped it pay for renewables, and a plummeting solar price makes both ends of the deal easier.
One way to do that is to cut the rate of consumption, which some are trying to do by making efficiency an easier prospect for Indians —
including LEED-certified buildings. Last year Goyal committed India to replacing all conventional streetlights with LED versions within two years.