Tag Archives: Coal

How the US Can Take Advantage of Australia’s Trade Disputes with China | Instant News


The coal days are numbered. The world’s dirtiest fossil fuels have long fallen out of favor with climate-conscious policymakers, investors and constituents, and even those who are less environmentally motivated have little reason to remain loyal to today’s emitting heavy fuel sources. more expensive than wind and sun in most parts of the world for years now. But even though coal is definitively experiencing terminal settlement, the settlement is anything but linear. While countries have made increasingly ambitious public commitments to curb their greenhouse gas emissions and wean themselves off coal when the crisis hits these goals are often overlooked in favor of a fast, cheap, immediate and reliable fuel. You could say that coal thrives in the midst of a crisis. We see Japan returned to coal after the 2011 earthquake and the subsequent Fukushima nuclear disaster caused politicians and constituents to shy away from nuclear energy. Mexico is experiencing a coal revival as we speak as President López Obrador makesthe push for domestic energy sovereignty is largely an antidote to an economic downturn. Even climate-conscious Canadians are tinkering with a return to coal because the economic strength of the oil sands has plummeted. But the biggest and most globally impacted coal returns have come from China, where many provinces are located leading the charge back to coal for economic security even as President Xi Jinping is committed to higher climate goals.

Although China has been busy increasing its domestic production capacity in various forms of energy and fuel production, from nuclear for renewable energy, it became clear that China was still heavily dependent on coal as its main fuel source when an unofficial embargo on Australian coal imports reportedly led to entire cities in China went dark earlier this year.

The unofficial embargo is just one chapter in a a much longer saga rising political tensions and failed diplomatic relations between China and Australia. “Relations between the two countries deteriorated last year after Australia supported an international investigation into the handling of the coronavirus pandemic in China,” CNBC reported late last year. While coal is not the only item on the long list of boycotted Australian goods, it certainly has a salient effect and reveals the extent to which China is willing to do a bit of geopolitical weaponry.

Related: US Oil Rig Count As WTI Stays Under $ 60

In October 2020, Australia exported 2.5 million tonnes of thermal and coking coal to China. Now, that number is zero. This means that a huge gap has opened in the market, and the United States seems eager to fill it, to the chagrin of those who urge coal producers to defend it. China has committed to buying files an additional US $ 52.4 billion in energy products over the two years starting last January as a condition of the first tranche of trade deals signed at that time. And some of these have directly filled the gap left by Australian coking coal with US imports “as trade manipulation creates ‘winners and losers’,” the “China Macroeconomics” section of the South China Morning Post. reported this week. Whereas the United States sold zero coking coal to China in October, when Australia’s coal ban began, it increased to nearly 300,000 tonnes of coking coal in February.

The US is not the only coal producer stepping up to meet China’s coal demand. Apart from increasing domestic coal production, China also relies on “increasing imports from the US, South Africa and Colombia which previously relied mainly on countries such as Indonesia, Russia, Mongolia and Australia,” the South China Morning Post report continued. . All of China’s major coal suppliers have increased or at least maintained their exports during Australia’s coal ban.

Coal is still in the process of being released. China has indicates that it is serious about meeting its goal of a net zero carbon footprint, and even the steel industry is moving towards a future where coking coal will not longer is needed in the production process. But the road to zero-day for coal will be a long and bumpy one, and as long as there is demand and money to be made, there are clearly many countries that want to provide supply.

By Haley Zaremba for Oilprice.com

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Germany grants second round of permits to close hard coal plants | Instant News


FRANKFURT (Reuters) – More than 1,500 megawatts (MW) of coal-fired power plants will close from December 8 this year, Germany’s energy regulator said on Thursday, announcing the results of a second round of auctions designed to cover closing costs. polluting plants.

FILE PHOTOS: Steam rises from the cooling tower of the coal-fired power plant RWE, one of Europe’s largest electricity and gas companies in Niederaussem, Germany, March 3, 2016. REUTERS / Wolfgang Rattay / File Photo

Germany has pledged to abandon coal by 2038 and achieve a largely carbon-free energy system by 2050, but is also seeking to reduce its impact on utilities, territories, jobs and public budgets.

Under a series of tenders between 2020 and 2027, operators were asked to state what price they would be prepared to close their hard coal plants in exchange for funds to partially offset their losses.

The regulator sets a maximum price per MW of capacity to limit public sector bills. The final price takes into account the bidder and the CO2 emissions of the plant concerned.

Of the 1,514 MW that will go offline in December, the standout is Uniper’s 757 MW Wilhelmshaven plant on Germany’s North Sea coast.

After 2027, compensation is no longer available, so operators are ready to bid as low as possible to avoid losses from competitors.

“The auction is again oversubscribed,” said Jochen Homann, head of the Bundesnetzagentur regulator. “The highest awards lie well below the maximum prices previously set.”

In all, the three successful bidders will receive between zero and 59,000 euros per MW, regulators said.

This is what they offered to close their factory, after the regulator set a maximum price of 155,000 euros / MW.

The third auction bid for the closure of 2,481 MW by the end of 2022 will close on April 30.

After the first auction, regulators closed 4,788 MW of coal-fired power plant capacity on January 1, 2021.

The more highly polluting brown coal is closed through a separate scheme with fixed compensation.

Reporting by Vera Eckert, editing by Barbara Lewis

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Column: Resource-rich Australia shows the strangeness of any super commodity cycle | Instant News


LAUNCESTON, Australia (Reuters) – For those looking for evidence of a new commodity supercycle, and for those skeptical of a sustainable resource boom, Australian government forecasters have covered it.

An autonomous truck prepares to load iron ore at Fortescue Metals Group (FMG) Chichester Hub Australia, which includes the Christmas Creek iron ore mine, in the Pilbara region, southeast of the coastal city of Port Hedland in Western Australia, 29 November 2018. REUTERS / Melanie Burton

The government’s latest Quarterly Resources and Energy Report, released on Monday, describes how some commodities surged during last year’s coronavirus pandemic, as well as how the gains were not comprehensive and may not be easily sustained.

The headline that caught the media’s attention was that the country’s resource and energy exports would hit a record A $ 296 billion ($ 226 billion) in the fiscal year to June 30, 2021.

Australia is the world’s largest exporter of iron ore, liquefied natural gas (LNG) and coking coal, which is used to make steel.

Indonesia ranks second behind Indonesia for thermal coal and third in copper ore shipments, and is a major producer of aluminum and alumina, the raw materials used to make refined metals.

Australia is also the third largest gold producer in the world and the largest net exporter of precious metals, and is a major supplier of battery metals such as nickel and lithium.

The outstanding performance for the country’s resource sector this fiscal year was driven largely by the top iron ore exports, which were estimated at A $ 136 billion, or just under half, of the total export value, according to a report compiled by the Office. Chief Economist of the Ministry of Industry, Science, Energy and Resources.

This is up from the A $ 104 billion iron ore exports in fiscal 2019/20, which was achieved at higher volumes (up 4%) and prices (up 41%).

The massive boom in iron ore revenue is largely a story fabricated in China, the world’s largest importer of steel spent on boosting its economy after being hit by the lockdown imposed to stop the spread of COVID-19.

The Chinese impact can be seen in several other Australian commodities, with copper export revenues up 20% to A $ 12 billion despite volumes shipped slightly lower.

However, it should be noted that apart from iron ore and copper, only the export value of gold increased in 2020/21, to A $ 29 billion from A $ 25 billion.

Australia’s other major resource and energy exports have declined, including LNG, crude oil, alumina, aluminum, zinc, lithium and both types of coal.

Lower prices for most of the fiscal year were largely to blame, although these have started to recover over the past few months.

SUPERCYCLE, WHAT SUPERCYCLE?

Much of the commodity super cycle story is built around high demand for resources from China, coupled with a synchronous boost from many other parts of the world as countries act to increase growth through infrastructure spending.

There are also expectations that supply for key commodities will struggle to keep pace, given weak investment spending by producers in response to sharp falls in prices in the early stages of the pandemic.

The Australian government report lends credibility to the demand side of the supercycle vision, but only for the commodities most exposed to China’s industrial strengths, namely iron ore and copper.

While others, including battery metals, are also showing signs of recovery, energy products have been underpinned by temporary factors, such as a reduction in producer production in the case of crude oil and a cold northern winter for LNG.

Where the report becomes more interesting is in its long-term view, which doesn’t see much of a demand-driven super cycle, with Australian energy resources and exports expected to rise to A $ 321.1 billion by 2025/26, a growth rate. a combined annual rate of only 1.7%.

It’s going to be a solid, unspectacular result, albeit far from being a supercycle story.

Digging into the breakdown shows that the commodity reports are expected to be most correlated with the energy transition, with export revenues from lithium expected to surge by about 440% from the current fiscal year to A $ 5.4 billion in 2025/26, while nickel will nearly double fold. to A $ 6.5 billion, and copper up 33% to A $ 16 billion.

In contrast, iron ore, this year’s star to the end of June, is expected to fade by then to A $ 104 billion – the same level as in 2019/20 – while LNG will remain relatively stable and both coal values ​​will decline. .

Overall, the report points out two things, first that the evidence for the emerging commodity supercycle is somewhat mixed, and second that while some commodities are likely to perform well in the coming years, profits will not extend to all.

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Australian securities regulators search the offices of coal miners TerraCom | Instant News


MELBOURNE, March 29 (Reuters) – Australian securities regulators ransacked coal miners TerraCom Ltd on Monday with assistance from Queensland state police, according to a report in the Australian Financial Review.

The investigation came after regulators confirmed it was investigating the ALS testing laboratory, whose internal review last year found that about half of the certificates awarded for export coal samples over the past decade had been altered to improve demonstrated quality.

The laboratory review made no mention of associates, but began after the unfair dismissal of TerraCom – which bought the Blair Athol coal mine in 2017 from Rio Tinto – that the miner had worked with ALS to fabricate export documentation.

TerraCom, which sells coal to Japan, Korea and China, has denied the allegations that have arisen in the case. Deputy Chairman Craig Ransley told Reuters that TerraCom will continue to work with authorities on industry-wide investigations.

Australia is the world’s largest coal exporter and ALS is one of the largest coal testers. “I can confirm that a warrant was issued today on behalf of ASIC, with the assistance of the Queensland Police,” said a spokesman for the Australian Securities and Investments Commission (ASIC), on condition of anonymity TerraCom.

Queensland Police, asked if Blair Athol TerraCom’s operation had been searched, said ASIC was leading the matter and referred any questions to regulators.

Last week, local media reported that ASIC Commissioner Cathie Armor told a Senate forecast hearing that she was “well aware” of allegations that the ALS lab had improved coal quality results on export certificates.

Armor did not provide further information due to ASIC’s policy of not commenting on issues being investigated, according to a report by the Australian Associated Press. South Korean electricity provider South-East Power banned ALS from certifying its coal tender last year. (Reporting by Melanie Burton; Editing by Tom Hogue)

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Australians with rooftop solar panels could immediately be charged for exporting power to the grid, under the proposed changes | Instant News


Australians with rooftop solar panels can immediately be charged for exporting electricity to the grid, under new rules recommended by the Australian Energy Market Commission (AEMC).

AEMC chief executive Ben Barr said the grid was struggling to cope with the changing power landscape, which is producing more solar energy than ever before.

About 20 percent of all customers now partially meet their electricity needs through rooftop solar power plants, up from just 0.2 percent in 2007.

Households sell their excess power back to the grid, putting more strain on the grid.

“The pole and cable business was set up to get electricity from a big generator, like a coal plant or a gas generator, that wire and into your home,” Barr said.

“The change we have seen over the last 10, 15 years is a two-way flow … now electricity is not only coming into your house, but electricity coming from your house.

“The system hasn’t been set up to handle that.”

He said “traffic jams” on the network were increasing forcing power companies to prevent households from exporting solar energy back to the grid.

Among a series of changes put forward in a draft decree released on Thursday is the removal of a ban on charging energy exported to the grid.

The AEMC said the recommendations were not designed to make export costs mandatory, but to create more flexibility and pricing options.

“Introducing this flexibility will benefit 80 percent of consumers who don’t have solar (photovoltaic) panels on their roofs,” Barr said.

“We’ve exemplified that there’s a slight reduction in their bill if this comes in.”

Mr Barr said households across Australia could see a reduction of up to $ 25 a year on their energy bills.

Up to 20 percent of Australian households partially meet their electricity needs through solar power on the roof.(

Provided

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Feed-in rates are lowered

According to AEMC modeling, introducing export costs would slightly reduce the returns that solar power customers receive.

“For a mid-sized system, we’re still modeling you’ll get a return of $ 900 per year and a slight reduction of $ 70,” Barr said.

The report shows people with large rooftop solar systems who earn more than $ 1,200 a year could see their profits diminish by about $ 100.

Those with systems smaller than 2kW to 4kW – which is the majority of rooftop solar households – can lose around $ 30 a year.

They will still earn around $ 645 per year from the feed-in rate.

Not a one size fits all system

Mr Barr said power companies could create a distinct service that would allow people to avoid costs altogether if they were to export electricity to the grid when it was needed.

“If customers can move around while they are using electricity, or when their electricity goes to the grid, they can see the benefits,” he said.

People can be charged a fee if they export when the network is busy, but Barr insists that’s not the default position.

“There will be a variety of options available to consumers … similar to your broadband.”

Yackandandah's health
Under the AEMC proposal, households with small solar systems would lose about $ 30 per year in their feed-in rates(

Provided: Completely Renewable Yackandandah

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Doing nothing is not an option

Mr Barr said grid congestion was a certainty and electricity distributors had to precede that.

The consequences of doing nothing can include statewide blackout.

AEMC received proposals for regulatory changes from power distribution company SA Power Networks and welfare groups, including St Vincent de Paul and the Australian Council of Social Service.

They argue that under the current system, households without solar power could be unfairly burdened with the cost of adding a grid to cope with new panel upgrades, which have taxed grids in heavy solar penetrating states like South Australia. .

In October last year, South Australia became the world’s first major jurisdiction to be fully powered by solar energy.

More than an hour on Sunday October 11, 100 percent of energy needs are met by solar panels alone.

Charging solar power owners is ‘not fair’

There is also some strong opposition to the adoption of export costs, including from the owner of the solar panels.

In submitting to the AEMC during the consultation, community group Solar Citizens said that introducing a fee was not justified.

The draft AEMC decision will be in public consultation until 13 May, with the final decision due in June.

Mr Barr said implementing any changes could be years away.

“Consulting with the pile and cable business and the Australian Energy Regulator to sign off on any changes will take over 12 [months] up to two years, “he said.

“So we’re not talking about the big blanket change that came overnight.”

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