Peak coal

2008-02-06

in Economics, Science, The environment

Heap of organic apples

The common account of ‘peak oil‘ is straightforward enough. Oil is a non-renewable resource; as such, every barrel taken from the ground means one less for the future. The depletion of current reserves is temporarily offset by the discovery of new reserves and the development of better technology to extract more oil from the reserves we know about. A higher price for oil stimulates both exploration and technological development, creating a negative feedback loop that, to some extent, moderates scarcity and long-run prices. Given the finite nature of oil, it is a logical necessity that extraction will eventually exceed new discoveries and technological improvement, provided we continue to extract oil. The controversial question is when this will occur. Some people argue it already has, others that it will not take place for decades. You have to be a real optimist to think we can continue to expand or maintain present levels of oil extraction for a century.

In the conventional story, the next fossil fuel in line is coal. This is bad for a lot of reasons, including the damaging nature of coal mining and the high pollution and greenhouse gas emissions associated with burning coal. At least, the conventional wisdom says, coal is plentiful. The American Energy Information Administration estimates that 905 billion tonnes exist in recoverable reserves: enough to satisfy the present level of usage for 164 years. The World Energy Council estimates reserves at a somewhat more modest 847 billion tonnes. Combining the idea of peak oil with the reality of dirty coal has led many environmentalists to fear a world where cheap oil runs out and people switch to coal, with disastrous climatic consequences.

An article in the January issue of New Scientist challenges this orthodoxy. The article argues that official reserves have fallen over the last 20 years to an extent far greater than usage, suggesting that the estimates were over-generous. It asserts further that the ratio of official reserves to annual coal extraction worsened by 1/3 between 2000 and 2005. This is attributed primarily to increased demand in the developing world.

The article predicts that the combination of higher rates of usage and smaller than stated reserves may cause oil to “peak as early as 2025 and then fall into terminal decline.” If this is true, it massively changes the logic of coal power and carbon capture and storage. The only reason anybody wants to use coal is because they perceive it to be a relatively inexpensive and amply provisioned fossil fuel that can be obtained from stable and friendly countries. If coal plants being built today with a fifty year lifespan are going to face sharply increased feedstock prices in a few decades, their economic competitiveness compared to renewable energy may be non-existent. This is especially true of plants with carbon capture and storage (CCS) technology, since they require about 20 to 40% more fuel per unit of electricity, in order to power the separation and sequestration equipment.

One article does not make for a compelling case, especially given the poor overall record people have had of predicting energy trends and prices across decades. The article acknowledges the scepticism surrounding the idea of peak coal:

The idea of an imminent coal peak is very new and has so far made little impact on mainstream coal geology or economics, and it could be wrong. Most academics and officials reject the idea out of hand. Yet in doing so they tend to fall back on the traditional argument that higher coal prices will transform resources into reserves – something that is clearly not happening this time.

Regardless of whether this particular analysis proves to be accurate or not, it does a service in questioning an important assumption behind a fair bit of energy policy planning. The idea of peak coal has a complex relationship with climate change. On one hand, it might reduce the incentive to develop CCS, making whatever coal is burned more climatically harmful. On the other hand, awareness that coal reserves are more limited than assumed might prompt more investment in renewable energy, the only option that is sustainable in the long term.

Even if world coal reserves are significantly smaller than the official estimates above, there is a good chance that burning all that is available will have extremely adverse climatic consequences. We know the approximate level of emissions that would maintain stable atmospheric concentrations of greenhouse gasses and we know that we are way above it. What we don’t know is the shape of the damage curve associated with increased concentrations, increased radiative forcing, and further increased mean temperatures. Even if there aren’t sharp transitions within the next 150 ppm or so, it is inevitable that extensive further use of coal will push us further into unknown and potentially dangerous territory.

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{ 10 comments… read them below or add one }

Anon February 6, 2008 at 10:05 am

Given the finite nature of oil, it is a logical necessity that extraction will eventually exceed new discoveries and technological improvement, provided we continue to extract oil.

It isn’t necessarily the case that there will be a smooth rise, a peak, and then a decline. There would be multiple fits and starts, corresponding to big new oil field discoveries and promising extraction technologies.

. February 7, 2008 at 11:25 am

Instant Energy Savings
The latest issue of Mother Earth News has an interesting article on ideas to reduce your carbon footprint:

8 Easy Projects for Instant Energy Savings

Anon February 13, 2008 at 10:55 am

A Storm on the Horizon
Trouble is brewing. Trouble I have been warning about since I started writing this blog. Trouble that was a big factor in me starting to write this blog:

Energy leader sees clouds

“An oil crisis is coming in the next 10 years,” John Hess said at the annual Cambridge Energy Research Associates CERAWeek conference in Houston. “It is not only a matter of demand. It is not only a matter of supply. It is both.”

That’s what I have been mostly concerned about. Despite the fact that I think supply can still grow a little from here, I see no easing in demand. And if we do actually peak in the near future – which I think we will – we are not close to being prepared for that.

. March 10, 2008 at 9:59 am

IFG Teach-In: Confronting the Global “Triple Crisis”
Climate Change, Peak Oil, Global Resource Depletion & Extinction

. October 16, 2008 at 11:36 am

Is 450 ppm politically possible? Part 2.6: What is the impact of peak oil and peak coal?

The goal of this post is to explore how peak oil and, yes, peak coal might affect the world’s effort to stabilize CO2 concentrations.

. January 8, 2009 at 12:20 pm

Are we approaching peak coal? Part 1

The imminent reality of peak oil production should be clear to all by now (see “Normally staid IEA says oil will peak in 2020“).

Now some very serious people are suggesting that there is a lot less accessible coal out there than most folks believe. If we are nearing peak coal (and peak oil), then we would need to embrace the rapid transition to a clean energy economy almost as urgently as we need to embrace it to avoid destroying the climate.

. March 11, 2009 at 3:48 pm

Fire or Ice? The role of peak fossil fuels in climate change scenarios

Posted by Ugo Bardi on March 9, 2009

Will the world end in fire or in ice? That is, are we going to be hit by global warming or are we going to freeze because of lack of fossil fuels? We don’t know yet, but it is starting to appear clear that geology is placing a major constraint on anthropogenic CO2 emissions and, therefore, on global warming. Here, I present a brief summary of some of the recent papers that have appeared on the subject.

. March 26, 2009 at 3:51 pm

Busting the Abundant Coal Reserves Myth

By Kevin Grandia on US

The coal industry’s spin doctors have been droning on about the abudance of coal for the last year, but new research by Dave Rutledge, Chair of Caltech’s engineering and Applied Sciences Division, calculates that the world’s coal reserves may be much less “abundant” than the coal industry would like us to think

. June 11, 2009 at 2:53 pm

Let’s repeat his calculation for the world as a whole. In 2006, the coal consumption rate was 6.3 Gt per year. Comparing this with reserves of 1600 Gt of coal, people often say “there’s 250 years of coal left.” But if we assume “business as usual” implies a growing consumption, we get a different answer. If the growth rate of coal consumption were to continue at 2% per year (which gives a reasonable fit to the data from 1930 to 2000), then all the coal would be gone in 2096. If the growth rate is 3.4% per year (the growth rate over the last decade), the end of business-as-usual is coming before 2072. Not 250 years, but 60!

. November 30, 2010 at 8:38 pm

Emissions scenarios are based on flawed assumptions, says energy expert
November 27, 2010

HERE’S cold comfort. It would be impossible, according to Swedish energy expert Kjell Aleklett, for us to emit enough greenhouse gas to warm the planet by 6 degrees: we don’t have enough oil, coal or gas to burn.

”All the emissions scenarios that have been put forward over the last 10 years are wrong,” says Aleklett, professor of physics at the University of Uppsala and world president of the Association for the Study of Peak Oil.

The UN’s Intergovernmental Panel on Climate Change business-as-usual forecast to 2100, which would result in 6 degrees of warming, assumes worldwide production of coal could rise 10 times higher than today.
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”That can never happen,” says Aleklett, who is on an Australian speaking tour this month and was recently heard on the ABC’s Science Show.

Aleklett says coal production will peak around 2030, and China is peaking about now.

”Ninety per cent of all coal reserves in the world can be found in six countries: the US, India, China, Russia, South Africa, and of course Australia,” he says. ”The whole CO2 emissions problem is only six countries. Those are the drug dealers when it comes to selling coal. If these six countries would stop selling coal, there would be no problem at all.”

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