October 31, 2016 Read More →

Coal Makes Poor People Poorer

Dana Nuccitelli for The Guardian:

A dozen international poverty and development organizations published a report last week on the impact of building new coal power plants in countries where a large percentage of the population lacks access to electricity. The report’s conclusions are strikingly counter-intuitive: on the whole, building coal power plants does little to help the poor, and often it can actually make them poorer.

Delivering electricity to those in energy poverty is certainly important. For example, household air pollution killed 4.3 million people globally in 2012; many of those lives could be saved and health improved with the use of electric stoves to replace burning wood or charcoal. However, the question remains whether coal is the best way to deliver that electricity.

The report notes that approximately 15% of people in energy poverty live close to existing electric grids, but there are a variety of barriers blocking their connection. For example, the poor consume relatively little electricity, so the costs of connecting them may exceed the resulting profits. The power lines used to connect them also result in high energy losses and power system instability. The poor also have little political influence in many developing countries. As the report concludes:

“This means that for energy-poor families living close to the grid, building new power generation capacity – coalfired or otherwise – will not help them get connected. Instead, access will require financing the upfront costs of new connections, and rationalising tariffs to reflect the true costs of supplying power.”

Not only are wind and solar better for the poor in terms of ease of deployment, clean air, and slowing climate change, they’ve also become cost-competitive.

South Africa, for example, is the cheapest place in Africa to generate coal-fired power, yet electricity from its new 4.7 gigawatt Medupi advanced coal plant will cost … 17% more than the electricity generated from South Africa’s 2 gigawatt of new onshore wind power. In India, the minister responsible for power development recently stated: I think a new coal plant would give you costlier power than a solar plant’ (Climate Home, 2016). The statement is supported by the extremely low bid prices for recent solar procurements in India (Kenning, 2015). Renewable energy investment in the emerging world now outpaces that in developed countries (McGrath, 2016).

Renewable energy also has low operating cost and zero fuel cost, while fossil fuel costs are variable and susceptible to price spikes. And renewable energy creates more (and safer) jobs than coal.

Coal companies and their allies often argue that we need to burn their products to lift the poor out of poverty. For example, Matt Ridley has claimed: “Those who advocate no support for coal are effectively saying that the adoption of renewable energy is more important than alleviating African poverty.”

In reality, there are better, faster, cleaner alternatives to help deliver electricity to the energy-poor. Those who argue to the contrary often do so to advance their own agendas.

Full item: Coal doesn’t help the poor; it makes them poorer

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