India also cold on coal

Following my post on China, I took a look at the situation in India, generally seen as the source of the next big ramp-up in coal-fired electricity. I found this article by Giles Parkinson, who suggests on the contrary

poor supply and pipeline infrastructure, and the high cost of coal imports mean that coal- and gas-fired generation is becoming unviable, even in a country with huge economic growth, an energy deficit and massive energy needs.

Following some of the companies mentioned by Parkinson, I found the recent news is even worse for coal-fired power, and better for renewables and the environment

Tata Power
CLP

As an aside, there have been a lot of stories about a boom in coal-fired power in Europe, in response to low global coal prices. At least in part, though, the story seems to be that the plants in question had been allotted a fixed number of operating hours before they closed down under the EU “large combustion plant directive which forces high-polluting power plants to close by the end of 2015 or after 20,000 operating hours from January 2008 unless they fitted greenhouse gas reducing equipment. So, the combination of cheap coal and expensive gas made it profitable to use up the hours quickly, then shut down, as with these UK plants.

39 thoughts on “India also cold on coal

  1. @John Quiggin

    Let us look at Point Henry smelter Victoria as a factual standard.

    “The current power demand of the smelter is 360 MW for a 185,000 tonne annual production capacity, of which approximately 40 per cent is met by the Anglesea power station. The Point Henry smelter, along with the smelter at Portland, use 18 to 25 per cent of Victoria’s electricity production. In March 2010 it was announced that the operators of Loy Yang B power station (Loy Yang Power) had signed a contract with the smelter operators for the supply of electricity to power aluminium smelters at Portland and Point Henry until 2036, the existing power contracts expire in 2014.” – Wikipedia.

    Since Loy Yang A & B use brown coal, something tells me Victoria (currently) is a very stupid place for an aluminium smelter. However, a single 800 m high solar convection tower will generate (on current estimates) 200 MW of power and do so 24/7. So 2 of these towers will power Hermit’s precious aluminium smelters (two!) with power to spare.

    Game, set, match, slamdunk, try, goal and hole in one! Easy peasy! What’s the issue? If you want the aluminium bad enough it can be done.

    “The world’s tallest man-made structure is the 829.8 m (2,722 ft) tall Burj Khalifa in Dubai, United Arab Emirates. The building gained the official title of “Tallest Building in the World” at its opening on January 4, 2010.” – Wikipedia. A circular cross-section convection tower with no weighty floors and purely bracing and reinforcing is, in “achieving the height with stability” terms, an easier engineering project so just don’t try to tell me it can’t be done technically. The physics and maths also prove the electrical output in theory. The practice will be close to the theory as this is straight hard science. All that will count is the economics and as I said if you want the aluminium bad enough with no CO2e and reliable 24/7 power to achieve drive the smelting then you will pay the price tag.

  2. @Stephen L

    Stephen L,

    The figures for off-grid solar may or may not be low, but they do come from the Indian Government department responsible for renewable energy and they are in fact numbers not just an argument about why they “must” be wrong. Considering the source, I will take them as a working assumption unless somebody comes up with some other credible or authoritative source. Over to you.

    In any case all this stuff about off-grid solar is, for the foreseeable future, all but irrelevant to the climate problem.

    A lot of Indian farmers get free grid electricity. Can’t see them installing PV while that continues. According to this press report, agriculture consumes 25% of India’s electricity, but contributes 5% of the revenue.

    http://articles.timesofindia.indiatimes.com/2012-10-31/edit-page/34818065_1_subsidised-power-state-electricity-boards-state-utilities

    India’s state owned electricity distribution companies have a shed load of debt:

    http://www.ft.com/intl/cms/s/0/3bf5816a-0662-11e2-abdb-00144feabdc0.html#axzz2EvQ9mHcE

    No doubt partly at least due to political pressure to keep tariffs low and subsidize agriculture. There is also theft and no doubt other issues. The power sector is generally a mess and it seems very likely that all this translates into regulatory pressure to keep wholesale prices low and perhaps too low, which would of course make the likes of Tata vulnerable to unfavorable changes in forex rates as per the linked news item in Prof Q’s piece. I have read other blogs which imply the coal generation is responsible for general mess of India’s power sector, including blackouts – PV will fix it. No kidding. It’s simple populist basic politics, but how true is it?

    It all well and good to claim coal is “unaffordable” but what does that mean? Compared to what? Reality is that if India wants 24/7 electricity it needs a lot more reliable baseload capacity. It can choose some mix of coal, gas, hydro and nuclear. For the “cold on coal” claim to be true, three criteria need to be satisfied:

    1. There is a baseload technology that has significantly lower LCOE, on average, than coal in India.

    2. It is deployable at the required scale and rates. (which very possibly rules out gas, hydro and in the short term nuclear).

    3. Indian government policy will back any such large scale move away from coal.

    None of these issues have been addressed and I’m sorry to say, all I have read is a story about coal bad and renewables nice. In the end, very few people, other than those with a direct financial interest, actually “like” coal but that won’t stop it.

  3. I do feel mildly guilty about drinking from then discarding an aluminium soft drink can. An SA type deposit scheme should go national to help recycle more aluminium. None of the recent non-coal generating technologies can produce power at 3-4c per kwh which is allegedly what the smelters paid before carbon tax. A tonne of raw aluminum takes 15 Mwh electrical input, say $600 worth of electricity.

    The smelters got 94.5% exemption from carbon tax on the grounds of being trade exposed, plus other cash goodies. Apart from the loss of jobs moving the industry offshore may increase global emissions. The new smelter in the UAE won’t have any hydro input or solar I’d imagine. Again I think the answer is the carbon tariff on imports unless the vendor can prove low carbon input.

    Thus Ms Rinehart’s excellent coal could go to India to help power smelters there, along with our bauxite and iron ore. Note Rio’s HiSmelt steel furnace that doesn’t need coking coal was dismantled in Kwinana WA and was to be re-assembled in India. If India is decarbonising it’s clearly not fast enough.

  4. @Hermit

    Hermit, my point was and is that the technology exists now to build 2 thermal convection towers 800 m high each. These would produce 400 mW and produce it 24/7. The smelters in Victoria need 360 mW. Thermal convection towers work at night as well as during the day. I have explained the basic physics in previous posts. I have explained that construction technically is no more difficult (in fact probably easier) than building 800 m tall buildings one of which already exists standing since 2010.

    Thus there is NO reason technically or energetically why it can’t be done. The economics of it comes down to this. If the market is willing to pay enough for the aluminium then the economics of it will work. If currently we are drinking sodas with sugar we don’t need (I do it too from time to time) out of aluminium cans then maybe sugar and alumunium are both currently ridiculously cheap. It wouldn’t hurt our health or the economy if the price of these commodities went up.

  5. @Ikonoclast

    If currently we are drinking sodas with sugar we don’t need (I do it too from time to time) out of aluminium cans then maybe sugar and alumunium are both currently ridiculously cheap. It wouldn’t hurt our health or the economy if the price of these commodities went up.

    Or aluminium production just moves somewhere else where electricity is cheaper. That’s globalization and an example of why the cost of low emission energy is so important in a world where the external costs of emissions are not being levied.

  6. The Solar+wind target would also produce about the same amount of electricity as India’s projected nuclear capacity in 2017 with the completion of reactors currently under construction

    That’s certainly a relevant comparison. It seems likely that, as in India, global solar/wind output will surpass that of nuclear sometime this decade. It’s also notable that India has heavily subsidised nuclear for decades, and anti-nuclear sentiment is minimal and ineffectual – still nuclear has gone nowhere.

  7. @John Quiggin

    India’s nuclear program has been hamstrung by a lack of domestic uranium and problems due to the NPT and it’s weapons program. This has had a number of consequences

    1. It has not had access to foreign light water reactor technology or the option of importing fabricated LWR low enriched uranium fuel. This has been a major obstacle.

    2. It’s current small nuclear capacity is almost all small heavy water reactors which do not require enriched uranium.

    3. It was always recognized that the potential for deploying PHWRs was limited. Hence the very long term Thorium and fast reactor program which has still a considerable way to go.

    The situation is now changed because of access to foreign uranium and PWR technology. The first two Russian built VVER reactors are ready to start up and approval has just been given for the six EPR facility at Jaitapur.

  8. The comissioning of the VVER reactors has been delayed again, so they aren’t quite ready to go. And the price of two new reactors to be built at the same site has doubled, so it looks like some new hamstringing is going on. Something to do with liability. But on the bright side, one reactor will probably start up in January, so fingers crossed they get it going by then.

  9. @Ikonoclast
    I suspect I’ll need to upgrade my system when my two-year old daughter gets old enough to start operating all the appliances herself. I think the term ‘mausoleum’ term is apt.

  10. According to this the target for 2012-13 for solar installations in India is 800MW. 1GW has already been installed. So to meet the lower end of those figures in 2017 rates of installation would have to drop from 2012-2013 (or this year’s figures not be achieved. Seriously? Solar installation rates just flatline even as the price continues to drop?

    http://www.thehindubusinessline.com/companies/article3700126.ece

    Moreover, the article indicates that off grid systems smaller than 1Kw are not counted. Since most systems will be smaller than that – indeed in the early days most will be more like 50w, that makes the data almost meaningless.

  11. @quokka

    I am in favour of carbon tariffs. If overseas smelters are using coal fired power then a few simple sums will tell us how many tonnes of CO2 are being emitted to make each tonne of aluminium ingots. Bung on a carbon tariff at say $50 a tonne of CO2 emissions. That perhaps gives our clean power smelters a chance, if we have any clean smelters that is.

  12. Australia’s cleanest smelter would be in Tasmania, thanks to the isle’s hydroelectric capacity now helped by its increasing wind and solar capacity. And don’t be fooled by the name, the Hydro aluminium plant in NSW is mostly powered by coal. Geelong would have to have the worst aluminium smelter in the world from a greenhouse gas perspective, it’s pretty much impossible for anyone to be doing a worse job than that, with the Portland smelter perhaps being second worst as it presumably sops up some wind and gas power from Heywood connector with South Australia.

  13. Our only hope is that fossil fuels rapidly become uneconomic for a variety of reasons. I say “our only hope” because although what is needed is a statist or dirigist led program to ditch all fossil fuels within 20 years, it is clear this is not going to happen.

    So, the only hope is that fossil fuels rapidly become uneconomic through a combination of factors;

    1. A carbon emissions price.
    2. Dwindling and more difficult to access fossil fuel reserves.
    3. Continued improvements lowering the price of renewable energy.
    4. Public distaste for the fossil fuel economy*.

    * One can perhaps foresee a change where fossil fuels become socially “uncool” to use and a sign that you are a dinosaur from a previous dirty, polluting and thoroughly reprehensible generation.

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