Category Archives: Business
Analysis shows Borneo can say no to coal power
Plans for a coal power plant in the Malaysian state of Sabah in northern Borneo have run into stiff opposition. Environmentalists say the coal plant could damage extensive coral reef systems, pollute water supplies, open rainforests to mining, and contribute to global climate change, undercutting Sabah’s image as a ‘green’ destination. The federal government contends that the coal plant is necessary to fix Sabah’s energy problems. However, a recent energy audit by the Renewable and Appropriate Energy Laboratory (RAEL) at the University of California Berkeley shows that pollution-intensive coal doesn’t have to be in Sabah’s future.
“We found that energy efficiency, biofuels, hydropower, and geothermal provide immediate advantages for the region over fossil fuels, and that in time both solar and ocean energy could provide even more energy than coal, while building jobs and a clean environment,” Professor Daniel Kammen, head of the energy analysis and director of RAEL, told mongabay.com.
Commissioned by Green SURF (Sabah Unite to Re-power the Future), a coalition of NGOs that oppose the planned 300 megawatt coal plant, Kammen examined Sabah’s energy options, including traditional fossil fuels, biomass waste, hydropower, solar, wind, and geothermal. The analysis also looked at the cost of each of these options to consumers, taking into consideration that an independent energy producer would require a certain return on their investment.
Alternatives
The study found that using biomass waste from Sabah’s extensive oil palm plantations could provide a significant boost in energy to the state while being cost competitive with coal. This solution would also deal with a waste-disposal problem for the oil palm plantations.
“The large scale of palm oil, and other biomasses means that this ‘waste’ is a huge resource,” says Kammen, though he also stresses that oil palm plantations are not without their own environmental problems.
“The challenge is not the technology, but in managing a wider issue, the growth in palm oil estates that have their own significant negative impacts on the region, despite their economic benefits,”
Using 2008 data from the palm oil industry, Kamman’s report found that by 2020 oil palm waste could provide a staggering 700 megawatts. Four hundred megawatts (a hundred more than the planned coal plant) would be achievable under a proposed 4-year-program.
Sunset over the Tabin Reserve rainforest. Environmentalists fear that a new coal plant near Tabin could damage the rainforest through acid rain and deforestation for transmission lines. Photo by Jeremy Hance.
Hydropower was also found to be a cost-competitive with coal and more environmentally friendly, while geothermal was found to be only slightly more expensive than coal. A location has already been identified on the east coast of Sabah for a 67 megawatt geothermal power plant. Yet, Kammen, adds that Sabah shouldn’t rule out solar energy.
“Solar energy is a far better, but a bit longer-term resource, than is widely appreciated today,” he says.
The cheapest way forward is to pursue reduction in energy demand overall notes the analysis.
Coal fears
Despite the many environmental problems known to accompany coal power, the coal plant is being pushed both by the federal Tenaga Nasional Berhad and the state energy company, Sabah Electricity Sdn. Bhd.
Opposition from locals has forced the coal plant to move its location—twice. Now, the plan is to build it on Sabah’s east coast, directly on top of the Coral Triangle, an area known for astounding marine biodiversity. In addition, conservationists fear the coal plant’s transmissions will cut through some of the region’s last intact rainforest in Tabin Wildlife Reserve, home to a number of endangered species including the Bornean orangutan and the Sumatran rhino.
Environmentalists also warn that sulfur dioxide emissions from burning the coal could trigger acid rain that would impact nearby rainforests and agriculture. In addition, discharge of chlorine sulfates into the ocean would boost the likelihood of regional eutrophication and algal blooms, resulting in massive marine die-off. Currently, the area is home to many fishermen who depend on the oceans for their livelihood.
Locals have said that they fear the coal plant will turn the east coast of Sabah into America’s coal states, where water pollution, air pollution, coal ash dumps, deforestation, and destructive mining have devastated the local environment and wildlife. They point to the coal ash spill in Tennessee in 2008 as an example of what they don’t want to become.
Moving forward
At Copenhagen last December, the Prime Minister of Malaysia, Datuk Seri Najib Razak, pledged a 40 percent cut in carbon dioxide intensity by 2020. By moving forward on coal energy, Malaysia would make meeting this goal even more difficult, since coal is the most carbon intensive of the fossil fuels.
Kammen says that the choice between coal and renewable energy doesn’t have to be an either/or choice: either cheap or expensive, either job-creation or job-loss.
“The people of Sabah are keenly aware of the need for jobs, and of their incredible natural resource base. Renewable energy supports that positive development, and a coal project in the region fights that positive, clean, growth,” he says.
Sabah, its people, and its policymakers are facing a decision similar to many places of the world: how do we move ahead on energy? Kammen says that if Sabah chooses renewable energy over traditional fossil fuels it could help spark a clean energy revolution.
“That economies in all parts of the world can look carefully at their resources, develop partnerships, and build a clean energy, job creating path, that protects the natural legacy of each state and province, and our shared global legacy to leave the world a better place for our children than we found it. So far, our society, globally, has not lived up to that charge,” he explains, adding that “Sabah can take a stand, profit from the choice, and chart a new path.”
To facilitate this ‘new path’, a forum is being held on Friday, March 20th to discuss energy production in Sabah and allow the public to air their views. Green SURF, the Sabah Electricty Sdn Bhd (SESB), and the Malaysian Palm Oil Board (MPOD) will be in attendance. source : news.mongabay.com
Coal India seeks equity, alliances
Coal India shortlists miners in Australia, Indonesia, US; imports to continue for foreseeable future; domestic coal prices to rise, supply growth restricted
Mumbai: State-run Coal India, the world’s largest coal miner, is moving swiftly towards signing strategic alliances to help fill India’s yawning coal supply-demand gulf, its director of marketing said on Wednesday. They would be in the form of equity or offtake deals with major coal mining firms in Indonesia, Australia and the United States and it has shortlisted 10 producers, A K Sarkar told Reuters on the sidelines of the Coaltrans conference in Mumbai.
India’s coal shortages have affected a range of industries including aluminium smelting and caused power plant coal stocks to shrink to two or three days’ worth. “The thirst is for equity and we are going full steam ahead,” Sarkar said in an interview. “We would prefer not to sign purely offtake deals, we want security of coal supply.”
Security of supply would best be guaranteed by owning all or part of existing or new mines, he added. To this end, Coal India has shortlisted 10 major coal producers and will take three months to carry out due diligence and decide which alliances to seriously pursue, he said.
Coal India is looking at three alliance models: equity in existing mines; pure offtake deals and joint ventures to develop new mines and deals will be signed with producers “sooner rather than later,” Sarkar said. Some of the coal producers with whom Coal India is in talks will be able to supply coal this year and some next year, he said, stressing the urgency of getting coal flowing rapidly.
India’s coal shortfall for 2010-2011 is 81 million tonnes but Coal India will fill only a portion of that as instructed by the Central Electricity Authority, Sarkar said.In February, Coal India subsidiary Western Coalfields said Coal India w ould import 6-10 million tonnes in 2010-11, up from around 1.5 million in the previous year.
Imports to continue strong
India has no choice but to import coal for the foreseeable future, at least five years, despite Coal India’s efforts to ramp up domestic coal output, Sarkar said. “Imports are a reality and will increase or decrease depending on how much we can increase our output but definitely imports will continue for the forseeable future, at least five years and will increase year to year,” he said.It is too early to discuss the structure of equity deals in exchange for coal or pricing for offtake agreements, Sarkar said, but the higher cost of imports would need to be reflected in domestic coal prices paid by end-users.
“There is a cost component for imported coal – domestic coal is less than 50% the cost of imports – and also Indian coal is a depleting energy resource, this must also be taken into account,” he said. India has vast coal reserves in the east of the country but strict environmental laws and the difficulty of developing mines where there are towns and villages restricts Coal India’s ability to boost output, Sarkar said. “The fact is, in India, land is almost a raw material. People do not want to move but you need land to get at the coal,” he said. source : livemint.com
