February 201 8 UK Coal Phaseout to be introduced with dangerous loopholes and delays The Government announced in 201 5 that it seeks to end coal burning for electricity within a decade, albeit only if “a shift to new gas can be achieved within these timescales”. It has now published its plan on how to achieve this: from October 2025, coal power stations will have to close unless their CO2 emissions are no higher than 450 kg/MWh at any time. By comparison, CO2 emissions from power stations that only burn coal are above 900 kg/ MWh. A coal phaseout is well overdue in the UK, and it is regrettable that the Government seeks to continue subsidising coal power until 2025, when, without subsidies, it might come to an end much sooner. However, there are two serious concerns about the Government’s decision even beyond 2025: firstly, power stations can continue to burn coal indefinitely, as long as they co-fire at least 54% biomass in each unit. This is based on flawed carbon accounting for biomass, using a methodology which ignores carbon emissions from burning biomass as most of those associated with logging and which has been denounced by hundreds of scientists worldwide. Whether companies can afford to co-fire that much biomass with coal remains to be seen. The second serious problem, however, is that the Secretary of State will be given powers to suspend the coal phaseout until such time as significant new gas power capacity has been built. It seems little coincidence that four of the companies operating coal power stations (Drax, RWE, Eggborough Power and SSE) have recently drawn up plans for major new gas power plants/units, ones which they are unlikely to afford without new or much higher subsidies for gas. They will now be in a position to tell the Government that without such subsidies, the coal phaseout cannot go ahead. The UK needs to urgently stop burning coal, and this needs to be part of a move away from fossil fuels and other high-carbon forms of energy, especially biomass electricity. Making a coal phaseout contingent on an expansion of gas burning will play into the hands of frackers and move us further away from avoiding the worst impacts of climate change. Finally, a coal phaseout must mean an end to coal mining, yet new destructive coal mines are proposed in the UK and the Government has so far failed to legislate against them. Coal phase out briefing • February 201 8 1 Introduction In November 201 5, Amber to set a maximum CO 2 Firstly, they will be able to keep Rudd, then Secretary of State emissions limit for existing coal their power stations open and for Energy and Climate Change, power plants – at less than half to keep burning coal provided announced that the the CO emissions from coal 2 that the co-fire it with more Government intends to become 3 power stations , but than 50% biomass. “one of the first developed significantly higher than the countries to deliver on a current average CO emissions 2 And secondly, the Secretary of commitment to take coal off per unit of electricity State will be given powers to the system” within one 4 generation in the UK . This new delay or suspend the emissions decade1 . Her promise came limit will be introduced from cap altogether if “too few” with one caveat: “We’ll only 1 st October 2025. Until then, new gas power stations are proceed if we’re confident that coal power plants can continue built. In theory, this power the shift to new gas can be 5 to draw subsidies . Those could also be used in the event achieved within these subsidies are in fact delaying a of any grid supply shortfall, for timescales”. much more rapid coal phaseout example caused by a shutdown which has been under way of nuclear power stations for Now, the Government has since 201 2. maintenance or repairs, or finally announced its plans for because of future shortfalls in ending coal burning for Worryingly, the Government’s electricity imports. electricity in the UK2. Rather decision leaves coal-burning than drawing up legislation companies with two get-out which would outlaw coal clauses even beyond 2025: power stations, it has decided Occupation of Ffos-y-Fran opencast coalmine, 201 6. Photo by Reclaim the Power Unnecessary delays Coal burning for UK electricity has been in steep decline in recent years: between 201 2 and 201 6, it fell by 72%. This fall was made possible largely by a tripling of wind and solar power and a reduction in electricity use6. In 201 7, it declined further7. However, between 201 7 and 2021 , seven coal power stations have been awarded a total of £453 million in subsidies8, paid through a surcharge on Drax Power Station. Photo by Andrew Whale electricity bills. Coal power station operators can continue 2025. Those subsidies are stations open which may to bid for such subsidies until artificially keeping coal power otherwise close earlier. 2 Coal phase out briefing • February 201 8 The biomass loophole A power station burning the UK since 201 1 is just 40 renewable electricity subsidies 1 0 1 2 biomass emits no less CO2 than g/kWh , although Drax, the for co-firing biomass . Drax one burning coal for every unit world’s biggest wood burners promptly announced that it of electricity it generates. The for electricity, cites a figure would convert a fourth of its Government has decided to three times as high1 1 . If the units to burning wood pellets, 1 3 ignore those CO2 emissions on Government’s figure is albeit at reduced capacity . the assumption that trees accurate, then plants could stay However, there will be no legal which are cut down and burned open and burn 46% coal and or technical reasons to stop for energy will in future be 54% biomass indefinitely. They Drax from using the subsidies replaced by new trees. It allows will even be able to attract to co-fire biomass with coal, energy companies to essentially subsidies in the form of even beyond 2025, something account only for the fossil fuel Capacity Market Payments if that would make economic emissions associated with their those offer a better deal than sense given that coal prices are biomass, e.g. fuel used for their renewable electricity lower than those for wood shipping9. The assumption subsidies for co-firing biomass. pellets. Companies will be able behind the Government’s to switch between renewable carbon accounting rules for Just a few days after the coal electricity subsidies and biomass have been condemned phaseout decision was Capacity Markets, depending by 800 scientists, who explain: published, the Government on which are more generous at “Cutting down trees for announced that coal power the time1 4. bioenergy releases carbon that stations can in future get would otherwise stay locked up around £6m in additional in forests… Even if forests are allowed to regrow, using wood deliberately harvested for burning will increase carbon in the atmosphere and warming for decades to centuries – as many studies have shown – even when wood replaces coal, oil or natural gas.” The Government states that the average CO2 emissions reported by biomass-burning plants in Forest campaigners in Wilmington, North Carolina. Photo by Dogwood Alliance Linking the coal phaseout to new gas power stations being built True to Amber Rudd’s words in response1 5 does not inspire such taking account of expected 201 5, the Government’s coal confidence. This states: new wind power projects (with phaseout decision confirms that solar and most onshore wind the Secretary of State will have The impacts on coal plant power now frozen due to “the power to suspend or retirements and subsidy cuts). amend the arrangements in requirements for new case there were significant and builds under the preferred This means that unless new imminent concerns about policy option are given in 3 fossil fuel power stations are security of supply.” It claims which shows that around built – ones which would be 5.5GW of new build that those powers are unlikely emitting large quantities of CO2 to be invoked because it is capacity will be needed in for decades to come – the confident that existing coal 2026. Government can allow coal power station capacity will be power stations to keep burning replaced by 2025. However, a The statement specifically refers coal and get subsidies for it closer look at the Impact to new fossil fuel power well beyond 2025. Assessment published together stations, i.e. the “minimum with the consultation need” has been calculated Coal phase out briefing • February 201 8 3 More subsidies for gas or no end to coal? The 5.5 GW of new gas power to get planning consent for by the Czech company EPH): 2.5 stations which the Government new gas power stations. GW, and SSE: 2 GW1 8. expects to be up and running According to research by by 2025 is less ambitious than Friends of the Earth, 22 GW of Yet so far, the dash for gas the 26 GW which George new gas capacity was either power station consents has not Osborne envisioned back in approved, in planning or in the been accompanied by a dash to 201 21 6. But it could hardly be advanced “pre-planning” stages invest in such plants. According reconciled with the aims of the by May 201 51 7. Since then, large to the Financial Times, just one Paris Climate Agreement to new proposals have been new gas power station, with a keep global warming to within published, the largest of them capacity of 0.88 GW, was built 1 .5oC.