The world’s largest coal port to be completely powered by renewable energy
Why we should be decarbonising the globe
Investing in new coal mines and exports could damage economies in countries like Australia and Indonesia as they move away from fossil fuels. Researchers at Imperial College London (ICL) and Queen Mary University of London, as well as Deloitte, concluded these findings in a new study published in Joule.
As we need to move away from fossil fuels to reach net-zero targets as a global collective, this has been putting pressure on current coal mines whose main exports rely on this resource. ICL carried out risk assessments depending on the scenarios and found that the same investment in coal mining and consumption as it is today, with a sustainable pathway reduces coal consumption so that global warming is kept below 2°C.
Due to the renewable energy pathway, a third of today’s coal mines will become stranded assets by 2040, meaning they will no longer be economically viable at the end of their operating life and will have to be disposed of. This has sped up the plans of the Australian government as their Prime Minister Scott Morrison made the long-awaited pledge to achieve net-zero emissions by 2050.
Where is the coal port?
The Port of Newcastle is based in South Wales in Australia, and was established (and running) in 1799. It handles more than 25 different types of cargoes and 2,258 ship visits each year. It has 20 operational berths and the main channel that reaches a depth of 15.2 meters.
However, according to Port of Newcastle, coal power generation in Australia’s national electricity market declined by 5.9% compared to the final quarter of 2020. Gas power generation also had its lowest quarter since 2004. By converting to fully renewable energy, the port could reduce its losses should these circumstances arise again.
What is the plan going forward?
Although the port still exports 165Mt of coal per year, it plans to decarbonise by 2040 and to increase its non-coal revenues so that coal only amounts to half of its revenue by 2030. Additionally, the port has also managed to switch 97% of its vehicles to electric, as they have pledged to convert to renewable energy.
A company that was once proud to be the world’s largest coal exporter is now proud to boast its fully renewable transition as the world transitions away from coal, the dirtiest of fossil fuels and a major source of greenhouse gas emissions.
This is because the plan will be more financially attractive in the long run as the world moves to use renewable energy sources and away from fossil fuels.
“I would prefer to be doing this now while we have control over our destiny, while we have revenue coming in, than in a crisis situation where our revenue has collapsed and no one will lend us money,” the Chief executive officer of the Port of Newcastle Craig Carmody said to the Guardian.
The plan has highlighted the desire for switching to renewable energy sources from the world’s biggest coal port.
But how will the port make the switch?
Well, the Port of Newcastle has made a deal with the Spanish Utility company Iberdrola to access their large-scale windfarm. Iberdrola has provided the port with generation certificates, enabling it to purchase energy produced by the Bodangora wind farm off the coast of New South Wales.
However, as the business continues to accept coal exports, it hopes that its decarbonization efforts will lead to other companies taking the same step. Through these steps, these businesses will be future-proofed, as countries could lose billions of pounds by continuing to maintain finite resources.
As solar and wind power squeeze coal out of the energy market, it leaves many wanting to make the switch to renewable energy. While we all need to do our part to combat climate change, the most effective way to do so is for the largest energy companies to switch to renewable energy sources.
While the port has been praised for this move by many, it has also been criticized for its long time frame to become fully renewable, which will still allow massive amounts of coal to be passed through the port.
The future for the coal industry
The global coal trade volume is projected to increase by almost one-and-a-half times over the next 30 years, and trade flows will continue to move towards Asia, according to the International Energy Agency.
Despite the growth in the coal industry, the use of renewable energy sources is still far cheaper than using fossil fuels. The International Renewable Energy Agency (IRENA), published a report in 2020 that outlined in 2019 shows that more than half of the renewable power plants added in 2019 had lower power costs than the cheapest coal plants.
Even though many coal plants and ports are attempting to switch to renewables, there is still more competition to beat in the race to a global, greener effort. It is still uncertain for now which direction the future of coal is going in but rest assured that you can still use renewable energy to help save the planet.
Take a look at the IRENA report findings here: https://www.irena.org/newsroom/pressreleases/2020/Jun/Renewables-Increasingly-Beat-Even-Cheapest-Coal-Competitors-on-Cost