7/19/13, "Asian Coal Use Grows Despite Gas Challenge," Wall St.. Journal, by JACOB GRONHOLT-PEDERSEN
"Sometimes dismissed as the dirty fuel whose day is
nearly over because of environmental concerns and ballooning output of
cleaner-burning gas, coal is on a roll in Asia, with governments across
the region ordering new coal-fired power stations.
Economic realities are outweighing worries about pollution, and
coal's lower cost means its share of the energy mix in most Asian
countries will rise for years, or even decades ahead. While investments
in more expensive and cleaner power production are continuing, a greater
emphasis on coal will provide life support for some mining companies
grappling with a demand downturns elsewhere.
It is the reverse of the scenario in the U.S., where coal's dominance
is being usurped by fast-growing and cheap shale-gas output, prompting a
rise in coal exports, some of which is making its way to Asia. In the
U.S., gas sells for around a quarter the price it does in Asia.
The fastest shift to coal is in Southeast Asia, where local gas
output can't keep up with energy demand and increasingly available
supplies of Australian and Qatari gas are seen as too costly. Southeast
Asians are embracing coal even as additional gas projects are rolling
out around the world, including in Russia, East Africa, not to mention
Coal demand across Southeast Asia may almost double
between 2010 and 2020 to 230 million tons, according to the
International Energy Agency, which in an April report warned that its
growing use to generate electricity is undermining efforts to rein in
global greenhouse-gas emissions.
“If you’re a local politician in Southeast Asia, you would definitely
consider coal to have a bigger role in your energy mix,” said Graham
Tyler, who heads energy research firm Wood Mackenzie’s gas and power
research team in Southeast Asia.
According to Wood Mackenzie, the share of coal-fired power generating
capacity in Southeast Asia’s energy mix will likely rise to 48% by 2030
from 35% now.
In Indonesia, the world's largest thermal coal exporter, the
government proposed in May to alter a long-term plan to increase power
generation using a variety of energy sources by raising coal's share.
Malaysia is building four large coal-fired plants, adding five gigawatts
of power capacity by 2019.
Vietnam is adding nine large coal-fired plants, due online in
2015-2016, in part because exploitation of its domestic gas reserves is
going more slowly than expected. A significant exporter of coal just a
few years ago, it recently started importing and plans to raise
coal-fired electricity capacity more than fivefold by 2020.
In Thailand in April, power supplies became a hot issue after
maintenance on a gas platform in Myanmar cut pipelined gas imports,
creating power shortages that forced manufacturers to halt operations.
Thailand uses gas for over two-thirds of its power needs, but officials
want coal to play a larger role.
"It is highly crucial for Thailand to introduce the use of coal in
power generation in order to help shoulder the cost of natural gas,"
Thailand's energy minister, Pongsak Raktapongpasal, told The Wall Street
Journal, adding that coal will help keep electricity prices low and
enhance energy security. "When compared with other types of energy
sources, coal remains cheaper," Mr. Pongsak said....
China, the world's largest coal consumer, uses it for over two-thirds
of its energy, and demand is expected to rise steadily until at least
the end of the decade. India could become the world's largest thermal
coal importer in coming years due to mining and transport bottlenecks
and stagnant domestic natural gas output.
Japan is burning more. Tokyo Electric Power Co.,
operator of the Fukushima nuclear power plant, said it used roughly
three times more coal in June
than a year earlier, helping offset idled
All this is good long-term news for Australia,
where for the past 18 months the mining sector has been hit by falling
prices and softening demand. "The construction of new thermal power
plants [in Southeast Asia] is very exciting in terms of being able to
sustain our industry here in Australia," said Paul Flynn, chief
executive of Whitehaven Coal Ltd., one of Australia's largest coal
Australian thermal coal exports are expected to rise to 183 million
metric tons this year, up 7% on year, and by a further 7% in 2014, the
government has forecast, despite some producers having shut mines and
"We don't foresee a glut of LNG in Asia and don't think marginal
costs for gas will come down in the long run to where they can compete
with coal," said Mr. Tyler of Wood Mackenzie." via Junk Science