Posted on 06/28/2022 9:29:16 PM PDT by SeekAndFind
It’s not something I ever thought I would see…
The use of coal as a way to generate electricity is on the rise. Given the politics around clean energy, it comes as a surprise to see the increasing use of coal – the dirtiest form of carbon-based fuel – to produce electricity.
Last week was a bit of a shocker as Germany announced that it would pass laws to reopen previously closed coal-based power plants for the purpose of electricity production.
It appears that there have been some unintended consequences from the European Union’s stance on Russia. Last week, Russia cut capacity on the main gas export pipeline to Germany by 60%.
With the economic sanctions from the E.U. and U.S. on Russia, which oddly enough largely excluded energy, China and India used the geopolitical turmoil to increase their purchases of both oil and gas.
China’s imports of oil from Russia increased 28% in May compared to the previous month. And India went from almost nothing to purchasing more than 750,000 barrels a day.
Apparently, there are other willing buyers of Russia’s energy than just the E.U.…
The problem centers around Germany’s energy policy, which makes it entirely dependent upon the supply of Russia’s natural gas. It had shut down all but three of its nuclear power plants, which are still scheduled to be taken offline before the end of this year.
Where does that leave Germany? It’s turning to coal… and lots of it. Other European countries that were importing Russian natural gas and oil are also scrambling now.
While the northern hemisphere may be enjoying its first post-pandemic summer, governments are in panic mode.
The summer solstice has already passed, and while most of us may not have noticed yet, the days are already getting shorter. And that means that fall and colder weather are not that far off, hence the race to reopen those coal-based power plants.
Making matters worse, the current heat wave in Europe is drawing down natural gas reserves in order to power air conditioning. This will make it even harder to replenish natural gas storage going into winter. It is a terrible situation that could become even worse in the event of a colder-than-normal winter.
And it’s not just a handful of European countries getting “dirtier.” It’s the U.S. as well.
It may come as a surprise to know that electricity production from coal, which had been on a decline since 2013 in the U.S., has spiked… but for different reasons than Germany.
Energy production from the dirtiest carbon-based fossil fuel increased last year in the U.S., in order to offset the corresponding drop in U.S. domestic natural gas production. Basically, the U.S. reduced the use of a far cleaner energy like natural gas and replaced that production with coal. And this is a trend that has continued into this year.
For additional perspective:
In 2013, coal represented 40% of the source of electricity production in the U.S. The steepest declines in the use of coal happened between 2017 and 2020. Coal, as a source of electricity, dropped all the way down to 20% and was planned to drop dramatically lower.
In 2021, coal as a source of electricity production jumped to more than 23%… almost a quarter of all energy production. We don’t yet have numbers for 2022, but they are likely to be even higher. I expect coal will jump to 25% of all electricity produced by the end of this year.
For those of us who like clean energy, this is not the right direction. And while terrible for the environment, it is somewhat of a renaissance for the coal industry.
Peabody Energy (BTU), the leading coal producer (and one that has been around since the 1880s), makes for an easy representation of what has happened in the industry in the last year and a half.
The company’s share price collapsed an incredible 98% from 2018 until November of 2020. But since then, Peabody’s share price rocketed as high as 3,815%. It has pulled back a bit, but it is still up more than 2,700% since those lows.
It’s an incredible story.
Peabody’s revenues were down 37% year over year in 2020. The company had negative gross margins, was grossly unprofitable, and had a negative $201 million in free cash flow.
This year, Peabody revenues will be up by 73% compared to 2020, it will have EBITDA margins of 44%, be very profitable, and have an extraordinary $1.4 billion in free cash flow.
What an odd beneficiary of what was supposed to be a clean energy policy.
Jeff Brown, just another Green Putin puppet.
It’s very interesting how the sanctions and blockades against Russia are changing business and industry around the world. But then Putin said it would be so....
Gee, I wonder what could have caused that?
What happened in 2021 to cause coal's share to rise from 20% to 23%?
Regards,
Gee, I wonder what could have caused that?
What happened in 2021 to cause coal's share to rise from 20% to 23%?
Regards,
“Jeff Brown, just another Green Putin puppet”.
You must not want to read the article. You might read something before you make silly statements.
The sanctions backfired. The Europeans will be breaking with the Americans before long because they don’t want to freeze this coming winter and they need Russian wheat.
Yes, I agree ...with winter not that many months ahead they don’t have the time to juggle things around. But then when they all began cutting off Russia I think we knew it would be short lived. Oil hardwires countries and always has.
The Chinese and Indians are buying huge amounts of Russian oil and India is turning around and selling it to Europe at a very hefty profit. When Europe eventually buys Russian oil again, the Russians likely won’t lower the price back to the pre-sanction days. Idiots.
He's using the verbiage of the Western ecowarriors. Anyone espousing "clean energy" is probably doing the dirty work of Xi and Putin in the West, and is guilty until proven innocent.
Are you saying that you're familiar with the work of this Jeff Brown, and can vouch for him?
That doesn’t mean Jeff Brown is kissing Putin/Green azz. Jeff Brown seems to be telling it like it is.
This is the first I’ve heard of Jeff Brown.
It’s very interesting to follow isn’t it? Recalling how the US was upset with India because they wouldn’t sign on to the sanctions - and frankly said they would take care of their people first.
As always, Gaia worshipers and Leftists don’t think. They emote.
Natural gas is far cleaner than coal. The US reduced its carbon emissions more than any other country and far more than the EU by......wait for it.....fracking. So of course when Biden did all he could to hamper fracking it wasn’t unicorn farts that energy was replaced with. It came from what we were using before - coal.
Who frikkin' cares about "carbon emissions"? The whole CO2 thing is a hoax. Don't play their game.
I’m just saying, even by their standards, Trump did incredibly well.
“It appears that there have been some unintended consequences from the European Union’s stance on Russia. Last week, Russia cut capacity on the main gas export pipeline to Germany by 60%.”
Actually, Canada cut the pipeline gas to Europe by 60%, by not returning the pumping units.
When your choice is freezing to death in the dark or firing up mothballed coal plants, the answer is obvious. Only America is stupid enough to ruin our economy and kill thousands of people by either starvation or freezing all in the name “climate change.” Next winter will be “interesting” to say the least.
Coal is our best energy resource!
There is plenty of it pretty much everywhere!
Us has like 70% of world known deposits!
W need to follow China lead and build up many coal power plants!
Forget the hoax! Go coal!
Great point.
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