Pandemic is accelerating coal’s demise

Bloomberg

You can add coal to the list of global commodities struggling during the pandemic. Prices haven’t yet turned negative (like oil), but coronavirus is accelerating the demise of the dirtiest fossil fuel.
Social distancing measures mean energy demand has fallen across the board. Some of the smallest declines, however, are in the electricity sector. That should have been good news for coal. But it hasn’t turned out that way. In much of the world coal power is currently more expensive than gas and renewables, which explains why its share in the electricity mix has fallen in Europe, India, China, and parts of the US. The power markets in these four regions are large and varied. That makes the uniformity of coal’s decline even more surprising.
But perhaps it shouldn’t be. Policymakers and activists have spent years trying to reveal the true costs of coal’s environmental impacts, with the aim of making the fuel economically less attractive.
Nearly half the world’s coal power plants are now running at a loss, according to the think tank Carbon Tracker.
Europe is a prime example of how to manage coal’s exit systematically. In the past two weeks, Austria and Sweden
announced that they have shut their last coal-fired power plants. They’ve now joined Albania, Belgium, Estonia, Latvia, Lithuania and Norway as countries without coal in their
electricity mix. The UK’s grid operator posted a new record—nearly 19 continuous days—of not using coal for electricity.
At a federal level, three policies have proven to be most effective: pollution regulation on power plants to lower emissions of sulfur, nitrogen oxides and particulate matter (coal produces more of all these than gas); a tax or price on carbon dioxide emissions (coal emits double the carbon per unit of energy compared to gas);
and mandates to increase the share of renewables in the electricity mix.
But that’s not enough. Difficulties at the local level also need to be addressed. Unlike solar and wind, coal power can be turned on and off when needed. That means grid operators need to figure out alternatives for when the use of coal ends—be it converting the power plants to using gas, installing batteries, or finding ways of importing clean electricity from other regions whenever needed.
The local challenges are bigger for countries and regions that mine coal and provide well-paying jobs for thousands of people. The end has to come with a plan to transition coal-dependent livelihoods. For instance, Germany is looking at a package worth $55 billion as compensation for regions and companies that rely on coal.