Energy Crunch: Kicking coal?

NOTE: Images in this archived article have been removed.

 

This week we saw three important signs of the increasingly moribund state of the fossil fuel industry.

 

First, a study by Greenpeace suggested that China’s coal consumption fell in 2014 for the first time this century, which could be just the impetus needed for December’s global climate talks in Paris. China’s amazing coal-fired growth has long been one of the major stumbling blocks to global emissions reduction plans – the country burns nearly half of the world’s coal – but things seem to be changing. The reported decrease in both coal production and consumption last year indicates progress in China’s efforts to address its rampant air pollution problems and carbon emissions.

 

Second, UK plans to spark a new fossil fuel industry in the form of fracking were slowed in the wake of a critical cross-party Environmental Audit Committee report. The committee’s conclusion that fracking is incompatible with climate change targets in the absence of full scale carbon capture and storage, and could pose significant local risks to public health, put some fire into the debate on the government’s Infrastructure Bill.

 

In the end the government was forced to accept a raft of amendments, including bans on drilling in environmentally sensitive areas, measures which according to the Guardian would put 40% of England’s shale areas off limits for drilling. The Scottish Parliament went a significant step further by announcing a moratorium on fracking pending further investigation. Following this, the Welsh Assembly voted in favour of devolving energy powers in order to prevent fracking in Wales.

 

Third, Chevron announced that it was withdrawing from shale gas exploration in Poland, previously considered the most promising location for a European shale revolution. Chevron’s announcement follows retreats by Exxon, Total and Marathon oil. The US shale industry is also suffering – BP’s CEO Bob Dudley said in an interview that the number of U.S. shale rigs was "dropping like a stone," as oil with high production costs comes under pressure from the low oil price.

 

Individually these are small victories, but together they signify a rapidly changing energy landscape.