Coal power stations to become ‘stranded assets’, UK climate rep warns

2nd November 2015

By: Terence Creamer

Creamer Media Editor

  

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The UK Foreign Secretary’s Special Representative for Climate Change, Sir David King, warned on Monday that countries building new coal-fired power stations could well be building “stranded assets”.

Speaking in Johannesburg on Monday, Britain’s former Chief Scientific Adviser, who was born and educated in South Africa, said any country still building coal-fired power stations was building “white elephants”.

“These are stranded assets that won’t yield electricity in 50 years time, because you would have mothballed them in favour of clean, renewable energy coming through.”

South Africa is currently building two new large-scale coal-fired power stations in the form of Medupi and Kusile and is about to embark on a programme to procure coal baseload capacity from independent power producers. It is also a major coal exporter.

King acknowledged that the South African economy depended heavily on coal and that coal mining was a major employer. But he urged the authorities to conduct a “deep analysis” into how to manage the transition away from coal. “It’s not overnight – we are talking about a 25-year transition to redeploy people into alternative industries.”

He saw significant job-creation potential in pursuing low-carbon solutions, highlighting the fact that the UK’s low-carbon sector, which did not exist 15 years ago, currently employed about 460 000 people.

“Last year, the turnover was £44-billion and we’re expecting that this is just the beginning. This new low-carbon sector is there for the taking in South Africa too.”

Delivering an address on the UK government’s ‘Climate Change Risk Assessment Report’, which he co-authored, King stressed the urgency of breaking from a ‘business as usual’ carbon-emissions trajectory, which posed serious risks to human life and economies. He also expressed optimism about the chances of a global agreement being struck at the upcoming climate negotiations to be held in Paris, France, from November 30 to December 11.

Nuclear energy, King said, had a role to play in lowering climate-changing carbon emissions. In fact, he noted that, since 2001, he had persistently argued that the UK would not manage to meet its 80% emissions-reduction target by 2050 without a new generation of nuclear power stations.

He, therefore, would not criticise the South African government’s controversial decision to pursue a 9.6 GW nuclear build programme. “All I would say is that, sunny parts of the world and windy parts of the world, probably don’t need an awful lot of nuclear energy,” while quipping, “Britain doesn’t have quite as much sunshine as South Africa – not yet anyway.”

He argued, too, that the future of nuclear energy probably lay in smaller, modular systems, owing to the difficulties associated with financing large-scale, long lead-time reactor investments.

In addition, modular nuclear plants were likely to be favoured in future rather than the 1.5 GW to 1.8 GW apiece reactors that took seven to eight years to build before being in a position to sell a kilowatt-hour.

“We are going down that route with our nuclear build,” King noted, referring to the UK’s 3.2 GW Hinkley C project, construction on which was expected to proceed after EDF, of France, and China General Nuclear Power concluded an investment agreement last month for the Somerset development.

Modular nuclear could face lower regulatory hurdles and costs as they would be smaller and safer to operate. Another key advantage was that they would be assembled mostly in factories and could, therefore, be completed within about two years. “You may only have 50 MW, but you have kilowatt-hours to sell . . . [and] you just keep adding the modules.”

There were currently no buyers for such plants, but King said the market was “poised” for such solutions.

Ultimately, however, solar energy would emerge as the most important form of energy. “We’ve got 30 000 times as much solar energy as we need to provide all the electricity needs for humanity. But we have to have energy storage, because we need electricity at night.”

King forecast that the combination of renewable energy, energy storage and smart grids would, within ten years, “beat all other forms of energy in terms of pricing and, of course, in terms of carbon-dioxide emissions”.

Edited by Creamer Media Reporter

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