As the prospects for coal-generated electricity recede globally, India is one of the last bastions of the world’s oldest, dirtiest energy source - coal - although construction of new coal-fired power plants is faltering.
From January 2016 to January 2017, development of coal-fired power capacity fell around the world – pre-construction activity dropped 48%, start of construction fell 62%, ongoing construction fell 19%, and the number of completed projects fell 29%, according to a March 2017 report, Boom and Bust, released jointly by the Sierra Club (a US-based environmental non-profit), Greenpeace (The Netherlands-based environmental campaigning non-profit) and Coalswarm (an online repository on coal).
Using data from the Global Coal Plant Tracker, an online database developed by Coalswarm that identifies, maps and categorises every known 30-MW and larger coal-fired power generating unit and every new unit proposed since January 1, 2010, the report maps a global move away from coal and towards renewable energy.
In China and India alone, construction activities that would add 68 GW–over a fifth of India’s total installed capacity–of additional coal capacity are frozen across 100 project sites, 13 of them in India. The primary reason for the slowdown in India is “reluctance of banks and other financiers to provide further funds”, the report said. Over half (56.5%) of India’s installed power capacity will be non-fossil fuel-based–renewables, nuclear & large hydroelectric–within 10 years, as IndiaSpend reported on April 19, 2017.
In India, as of February 2017, at least 15 coal-based thermal power projects with an aggregate capacity of 18,420 MW (18.42 GW) were stalled due to financial reasons, the power ministry told the Lok Sabha (lower house of Parliament) on February 9, 2017.
However, in March 2017, the Cabinet revived some struggling power projects with a cumulative capacity of some 30 GW under a new Mega Power Policy by providing support of about Rs 10,000 crore to the sector, in addition to incentives such as custom duty waiver for import of capital equipment and tax breaks. This was done to relieve the burden of stressed assets on banks, estimated at Rs 1.5 lakh crore, according to this report published in the Times of India on March 31, 2017.
“The slowdown in the coal power pipeline brings the possibility of holding global warming to below 2°C from pre-industrial levels within feasible reach,” the Boom and Bust report stated. However, this hinges on countries such as Vietnam, Indonesia, Turkey and Japan limiting their future coal power development, China and India reinforcing and increasing the slowdown, and developed countries (historically largest emitters) retiring coal-based power plants faster than they have been doing.
To restrict global temperature rise to 1.5°C, the report said, an immediate doubling of the current pace of retirement would be needed, meaning plants as young as 20 or 30 years would have to be retired even though the average lifespan of a coal plant is 40 years.
India does not plan on expanding its coal-fired capacity during 2017-22, according to the Draft National Electricity Plan proposed in December 2016 by the Central Electricity Authority. It bases this projection on the presumption that non-fossil fuel capacity addition will continue as targeted–4.3 GW of gas-fired plants, 15 GW of hydroelectric plants, 2.8 GW of nuclear installations and 115 GW of various renewable sources, which would come online during 2017-22.
The plan, however, does take into account 50 GW of coal-based installations that are currently under different stages of construction and are likely to yield benefits during the 2017-22 period, concluding that no coal-based capacity addition is required until at least 2027, as IndiaSpend reported on April 19, 2017.
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