Asian countries are responsible for 80 per cent of the world’s planned new coal-fired power plants, with India being the second-largest coal power producer with around 250 gigawatt (GW) of operating capacity and 60 GW in the pipeline.
This was revealed in the latest report ‘Do Not Revive Coal’ released by the financial think-tank Carbon Tracker on Tuesday. According to the report, China, India, Indonesia, Japan and Vietnam plan to build more than 600 new units with a combined capacity of over 300GW, ignoring calls from United Nations secretary general Antonio Guterres for all new coal plants to be cancelled.
Out of these planned units, 92 per cent of them will be uneconomic, even under normal business, and up to $150 billion could be wasted, the report stated.
The report stated that in India, new renewables can already generate energy at lower cost than 84 per cent of operating coal and will outcompete everywhere by 2024. “It has a target of 450 GW of renewables by 2030 – more than five times its 2020 capacity which would meet 60 per cent of energy demand,” the report stated.
The analysis further highlighted that at the corporate level, just ten companies account for around 40 per cent of the stranding risk, of which NTPC and the Adani Group in India, and PLN in Indonesia are by far the most “exposed”. “Of the ten most exposed companies, seven are head-quartered in India,” the researchers found.
The same five Asian countries also operate nearly three quarters of the current global coal fleet, with 55 per cent in China and 12 per cent in India. The report warns that around 27 per cent of existing capacity is already unprofitable and another 30 per cent is close to break even, generating a nominal profit of no more than $5 per MWh. Worldwide, $220 billion of operating coal plants are deemed at risk of becoming stranded if the world meets the Paris climate targets.
Stating that around 80 per cent of the operating global coal fleet could be replaced with new renewables with an immediate cost saving, the report added, “By 2024, new renewables will be cheaper than coal in every major region, and by 2026 almost 100 per cent of global coal capacity will be more expensive to run than building and operating new renewables.”
Carbon Tracker’s head of power and utilities, Catharina Hillenbrand Von Der Neyen said, “These last bastions of coal power are swimming against the tide, when renewables offer a cheaper solution that supports global climate targets. Investors should steer clear of new coal projects, many of which are likely to generate negative returns from the outset.”
IN A NUTSHELL
5 Asian countries responsible for 80 per cent of world’s new planned coal plants
China, India, Indonesia, Japan and Vietnam plan more than 600 new units with combined capacity of over 300GW
India second largest coal power producer
Has around 250 GW of operating capacity, pipeline of 60 GW
Among the top 10 companies most exposed to stranded asset risks, 7 are from India
