Cheap fuel for developing nations; disastrous for the climate. We asked three experts if it is morally defensible to bankroll new mines and power plants
(credit: Pixabay)
By Alex Pashley
Coal is the dirtiest fossil fuel. Cheap and plentiful, the black rocks are the energy of choice for many developing nations to lift people out of poverty.
But to avoid catastrophic climate change, 80% of the world’s reserves can’t be burned, according to scientists.
Pension funds, insurers and universities are shedding coal investments. Some oil majors are backing a transition to cleaner natural gas. Yet over 2,000 new coal-fired stations are in planning with India, China and Vietnam leading the expansion.
How to square development needs with tackling climate change?
Benjamin Sporton, CEO of World Coal Association, London
Stepping away from the fossil fuel industry does not mean that the demand for fossil fuels will go away, it just means that environmentally conscious investors lose any influence they have over the operation of those companies.
Demand for coal – particularly in regions such as developing Asia – is projected to grow well into the future. Not only does coal play a vital role in electricity generation but coal is also an indispensable ingredient for building modern infrastructure to support urbanisation and economic development.
Given the ongoing role of coal, the priority should be ensuring coal is used as cleanly as possible, through the use of low emission technologies. These include high efficiency, low emissions (HELE) coal technologies and carbon capture and storage (CCS).
Responsible investors have an important role to play in widening the deployment of HELE and CCS technologies and therefore reducing emissions from the fossil fuel industry.
Timothy Gore, policy lead on food and climate change, Oxfam International, Stockholm
It is immoral to blindly invest in coal. It has disastrous health impacts, sucks huge quantities of water and gobbles land, often at the expense of marginalised farmers.
Moreover, coal won’t help much with energy poverty: 80% of people without energy access live in rural areas, they need off-grid renewables not more centralised power that doesn’t reach them. Those are reasons enough to re-consider coal investments, irrespective of its role in driving climate change.
Some investments in limited circumstances will continue to be needed in the near term, few poor countries will be able to turn away from coal overnight, but the burden should now be on investors to show their projects are the best available option for people in poverty.
Nick Blitterswyk, CEO of renewable energy company UGE International, New York
We all have countless options for our investment dollars; choosing to invest in coal is both immoral and a poor economic decision.
It’s not just clean tech companies who are aware of the trend towards cleaner sources of energy.
Banks like Goldman Sachs, countries like Norway, and organizations like the Rockefeller Foundation are selling their carbon assets to hedge against losses. Coal is not only toxic to the health of our planet, it’s also increasingly toxic to hold as an investment.