Rystad Energy says coal usage this year hit its tipping point and will start to slide – albeit slowly. Meanwhile these ASX stocks have exciting green energy news.
Jessica Cummins and Bevis Yeo
5 min read
December 12, 2023 – 9:27AM
Stockhead
It looks like coal power is set to take a tumble. Picture: Getty Images
It looks like coal power is set to take a tumble. Picture: Getty Images
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Norwegian independent energy research and business consultancy Rystad Energy forecasts that coal usage and emissions in the global power sector have reached their peak and will start declining in 2024.
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According to its modelling, new electricity supply from renewables is expected to outstrip power demand growth and start the displacement of coal, which has had a dominant role in electricity generation and is a major rason why the power sector is the largest contributor to global pollution – accounting for about 40 per cent of all emissions.
Picture: Rystad Energy
Picture: Rystad Energy
Rystad noted that while falling investment in coal capacity and overall usage in Europe and North America had been offset by growth in Asia, the fossil fuel would be gradually displaced by the rapid development of low-carbon power sources.
However, the green lobby might want to hold off on celebrations as the projected drop is marginal – a mere 41 terawatt hours (TWh) to 10,332TWh, or just under 0.4 per cent.
“The drop in total coal generation in 2024 may be small on paper, but it signals the beginning of the renewable energy era in the power market,” Rystad senior vice president of renewables and power research Carlos Torres Diaz said.
“However, there are still challenges to overcome in a renewables-heavy electricity sector, including intermittency issues. For that reason, coal and natural gas power plants will ontinue to play a key role by providing baseload supply and flexibility.”
Annual projected global energy-related CO2 emission by fuel (2020–2050). Picture: EIA
Annual projected global energy-related CO2 emission by fuel (2020–2050). Picture: EIA
Further evidence that coal might have peaked comes from the US Energy Information Administration (EIA), which projects global CO2 emissions from coal as remaining relatively flat through to 2050.
While this is less positive than Rystad’s forecast, it is still an indicator that coal’s day has at least peaked.
Taken together, what is clear is that coal’s impact on emissions is finally starting to wane.
However, there is still a long way to go before the use of coal goes the way of the dinosaurs as developing countries cling to its use as a cheap way of generating electricity.
China and India, for instance, account for about two thirds of the world’s predicted coal consumption between 2022 and 2050 with India’s consumption expected to double uring that time.
MORE FROM STOCKHEAD: Australia passes peak gas production | Toyota finds shot in hydrogen offensive | Nuclear ‘will remain dream’
Steps for a faster, more efficient transition
Rystad isn’t just content to forecast coal’s decline though.
The energy consultancy has also outlined 10 steps to accelerate the transition to net zero, limit global warming and ensure a clean and reliable energy future.
Some of the notable recommendations are fast-tracking renewable energy developments, taking meaningful attention on methane and putting a price on carbon.
On fast-tracking renewable energy developments, Rystad says that while the supply chain is primed and ready to expand developments quickly, the rollout needs to be accelerated by shortening permitting times and mitigating short-term financing barriers such as high interest rates.
It noted that global renewable capacity needed to increase from about 3.6 terawatts (TW) last year to nearly 11.2TW by 2030 to meet a 1.6-degreeglobal warming scenario.
Energy transition policies and the technology innovation cycle. Picture: Rystad Energy
Energy transition policies and the technology innovation cycle. Picture: Rystad Energy
Reduction of methane emissions is also important as while it makes up to 20 per cent of global greenhouse gas emissions, it is often overlooked in net zero strategies.
Supporting investments in emerging agriculture technologies such as cellular agriculture and precision fermentation can significantly reduce emissions from livestock while promoting landfill gas capture and anaerobic digestion can turn these emissions into energy or hydrogen, reducing methane release into the atmosphere.
Australia certainly seems to be on board, committing during the recent COP28 conference to a 30 per cent reduction in methane emissions by 2030.
Rystad also called for a maturation of the value of carbon, saying it is particularly important in hard-to-abate sectors, where a carbon price directly influence the adoption rate of clean technology such as carbon capture, utilisation and storage.
There are seven more steps described by the consultancy but that such steps are even needed just serves to underscore how much activity is still needed globally to meet net zero emissions by 2050.
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ASX companies with green energy news
NICKEL INDUSTRIES (ASX:NIC)
This Indonesian focused nickel producer disclosed its goal of reaching a 50pc reduction in carbon intensity by 2035 and net zero emissions by 2050 at the United Nation Climate Change Conference (COP28) in the UAE.
Since its IPO in August 2018, NIC has established itself as a global top 10 nickel pig iron producer, recently diversifying into the “Class 1” nickel EV battery supply chain by converting some of its current production into nickel matte.
It also acquired an interest in the operating Huayue Nickel Cobalt high pressure acid leach (HPAL) project (HNC) back in August, one of the irst HPAL projects in Indonesia, which is being developed by majority owner Huaqing Nickel and Cobalt, a wholly owned subsidiary of Huayou Cobalt.
NIC managing director Justin Werner says the company is implementing the most advanced third-generation HPAL processes with power consumption 70 per cent lower than other HPAL plants and carbon emissions one-tenth of similar pyrometallurgical plants.
“These and other measures, including the adoption of renewable power sources across NIC’s operation to further decarbonise puts us on track to achieve a 50 per cent reduction in carbon intensity by 2035 and net zero emissions by 2050,” he said.
AGL ENERGY (ASX:AGL)
AGL Energy and US energy-tech company SLB are working together to pilot a nickel hydrogen battery at AGL’s Torrens site in Adelaide, with a target installation date set for 2025.
The small 180kW/360kWh, pilot-scale nickel hydrogen battery will be the first of its kind in Australia and is part of AGL’s wider strategy to transitionthe former gas hub into a new clean energy precinct.
Given their high energy density and long life, nickel hydrogen batteries are widely used in the world today, as energy storage in satellites and space probes.
The ISS, Mercury Messenger, Mars Odyssey and Mars Global Surveyor are equipped with nickel hydrogen batteries.
AGL’s MOU with SLB will run for up to two years with AGL testing the operational performance of the battery at AGL’s Torrens site, with the battery providing storage for on-site power use.
RIO TINTO (ASX:RIO)
Rio has given the tick of approval for a new 12.4MW solar farm and 8.8MVa/2.1MWh of battery storage to provide renewable energy for the Amrun bauxite operations near Weipa in Queensland.
The 12.4MW solar farm and battery storage are part of Rio’s ongoing efforts to reduce emissions at its Pacific bauxite, alumina and aluminium operations.
They are expected to reduce Amrun’s diesel electricity consumption by 37pc and annual CO2-equivalent emissions by 14,000, and will add to the existing 5.6MW of solar and 4MWh of battery power built for Rio’s Weipa operations and the local electricity network since 2015.
Fortescue (ASX:FMG)
The green leg of Fortescue is at it again with another hydrogen MOU, this time with global consulting and software engineering group, HTEC, to explore building Canada’s first domestic green hydrogen supply chain and develop offtake opportunities.
Fortescue is proposing the development of a green hydrogen and green ammonia production facility in Prince George following the submission of an initial project description in September 2023.
Under the terms of the MOU, HTEC would offtake green hydrogen from Fortescue’s site to facilitate the growth of the green hydrogen transportation market.
This content first appeared on stockhead.com.au
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