UK doubles coal imports to head off winter energy crisis

…imports almost double as Ukraine war turns natural gas into a no-go zone

…more than 560,000tonnes of coal came into British ports last month

Rising gas prices resulting from the war in Ukraine have forced the UK to nearly double its coal imports in the fight to keep the lights on through the Winter.

The increasing use of coal-generated power in the UK comes after years of the country shifting to cleaner electricity from gas-fired power plants and renewables, but is deemed vital as Russian president Vladimir Putin crimps gas supplies to Europe.

Figures from Kpler, a commodity analytics firm, show that last month more than 560,000 tonnes of coal came into British ports, compared to the 291,089 tonnes that arrived in October 2021, a 93 per cent increase.

In the first 10 months of this year, the UK imported more than 5.5 million tonnes of coal, already exceeding the 4.2 million tonnes throughout the whole of 2021.

Victor Katona, senior analyst at Kpler said increased demand for coal is because of the rising price of wholesale gas. “Absent the option of burning fuel oil – the most cost-efficient power generation option right now – coal- is very much the best option out there, albeit the most polluting one, too.

With gas prices like these, relying on natural gas for power generation is a no-go zone for anyone who can switch between fuels.”

Prices for gas increased rapidly since the invasion of Ukraine.

The doubling of the October coal imports suggest the UK is accelerating purchases as winter draws nearer. Official data for the Department for Business, Energy and Industrial Strategy for the April to June quarter showed the annual increase was only 44 per cent.

The extra coal that has been flowing to the UK is thermal coal which is burned to create steam used for electricity generation as opposed to coking coal, used for making iron or steel.

Most of the coal was arriving at the ports in Belfast and Immingham.

In its scramble for coal, the UK is importing from countries it has never traded with before. Mozambique had never sent coal to Britain before but was the second largest exporter of coal to the UK in September behind the United States.

Environmental groups condemned the increased imports and said the UK had an opportunity to move away from pollutants. ‘’Instead of replacing Russian fossil fuels with more polluting coal, banging its head against the same wall and hoping for the headaches to go away, the government should invest in home insulation and renewables,” said Louis Wilson of the NGO Global Witness.

Analysts said some of the imports will become storage ahead of the arrival of cold winter weather.

Lou Roberts, research manager for the Coal Transition Team at E3G, said that the UK has bolstered its coal stocks in case of a “worst case scenario” of excess demand during a cold winter which would have usually been met by gas. “This coal will only be burnt if there isn’t enough wind or solar or gas supplies are running low […] There might be one or two days during the winter that could require turning these coal power stations on but that might not happen. So we might end up with this coal sitting there and not being burned.”

Since the UK’s “dash for gas” in the 1990s, coal’s share of electricity generation has halved and there are now only three coal fired plants running. Tony Lodge, political and energy analyst at the Centre for Policy Studies said the UK’s reliance on gas made it vulnerable to shocks.

He said: “Having to ask 50 year old coal fired power stations to stay on for another two to three years in the hope the energy crisis will go away is a sign of a failed national energy policy.”

Lodge said that the government should have a more balanced energy mix that would make the UK less vulnerable to shocks.

The disruption in energy markets from the war in Ukraine has delayed the UK’s plan to end the use of coal power by 2024. In May, Kwasi Kwarteng, then business secretary asked National Grid executives to work with the owners of Britain’s three remaining coal fire power plants to ensure energy security for the Winter. Last month, Uniper SE, which owns the Ratcliffe-1 coal-fired power plant in Nottinghamshire announced it was going to keep the plant open to secure winter energy, despite plans to shutter it this year.

Source: Times.co.uk