China,
India pouring cash into coal plants that may not be used
Analysts say any coal-fired plant completed after
2016 will not be profitable enough to operate in the future.
- · 11 GW of India’s coal capacity is currently lying idle, and this is expected to increase this year, according to the report.
- · The recent decrease in demand can be largely attributed to the economic slowdown. Analysts predict that decrease to continue even once the economy picks up due to two factors: future emissions reduction measures agreed at last year’s UN climate summit in Paris, and the increased implementation and falling cost of renewable energy. In India a carbon tax has been proposed and China is moving forward with emissions cap-and-trade schemes.
- · In India where power generation from coal is growing, investment has run way ahead of demand. The realization rate has been falling for several years, mainly because the power market just can’t support the plants.
- · Analysts are predicting that as a result, many of the 1,500 plants being planned for construction in the coming years worldwide will not be built. But even if only half of the planned plants are built, new plant construction in Asia will outpace old plant retirement in Europe and the Americas by five times.
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