INTERVIEW: Clean coal technology more cost-effective than renewables, says FutureCoal CEO

Investments in clean coal technologies for power generation as well as the non-power sector will lower the cost of energy transition, take less time to cut down emissions and ensure seamless electricity supply, FutureCoal CEO Michelle Manook told S&P Global Commodity Insights.

A global alliance of producers, consumers and investors for sustainable coal, FutureCoal -- formerly known as World Coal Association -- advocates a cleaner way to use coal to lower emissions through industry-wide modernization of technology and collaboration.

"We know there are technologies, particularly for thermal coal, which can abate up to 99% of emissions. We did a cost-and-benefit study that demonstrated if you abated coal with clean technologies, it was actually cost-effective compared to a green alternative," Manook said on the sidelines of a conference in New Delhi.

Technologies meant to lower CO2 emissions from fossil fuels like carbon capture, usage and storage (CCUS), selective catalytic reduction and flue gas desulfurization have struggled to gain acceptance, with the green industry arguing that it would be better to finance proven technologies like renewables. However, over the last few years, policymakers and industry leaders have called for an international strategy that will make these technologies financially feasible and cut emissions significantly.

"If the intention of the global community and the Western countries is to actually reduce the emissions and support developing and emerging nations, then abated coal technologies have to be on the table," Manook said, adding that right now removing coal and switching to renewables is being made to look like the only option, which is not true.

China, India to drive clean coal adoption

According to Manook, China and India, which consume over 55% of the world's coal, will likely leverage technologies to make coal cleaner as there is an enormous amount of focus on having a reliable baseload.

Of the 8 billion mt of coal produced globally in 2022, China consumed 4.5 billion mt, while India's consumption rose to nearly 900 million mt.

"It makes sense for India and China to invest in coal but it also makes sense for them to invest in diversity of energy sources. Since infrastructure for gas is very expensive and we know the cost of transitioning to renewables, I think the investment that China and India want to make in coal is really around the coal ecosystem to make it more efficient and cleaner," Manook said.

Stating that funding of coal-based projects is drying up globally, Manook said there's a need for a platform where risk assessment can be made and an opportunity to create a sustainable coal stewardship model is created. "Funding may not come in the traditional way but that doesn't mean funding isn't there, it just costs a lot so we really need to make sure that countries are setting policies that are realistic and also agnostic to the form of energy."

Europe's energy trilemma

Highlighting that Europe's move away from coal is not a complete one, Manook said while most of Western Europe has used most of its coal, coal is still an important energy source in other parts and they should not be forced to take on a position which isn't reasonable for their economy.

Manook pointed out that renewables are not a cheap source of energy and as much as Europe wants to intermittently use renewables for everything, it cannot happen as it will be similar to putting "all eggs in one basket," which will again be "tested against reality."

Several European coal-fired power plants were reopened post the Russia-Ukraine war as sanctions on Russia stopped flows of gas, a major energy source for the continent. European CIF ARA 6,000 kcal/kg NAR physical prices hit record highs last year, crossing $400/mt in June-July as global thermal coal prices surged with the war disrupting trade flows and weather-related problems impacting output amid rebounding demand. Platts assessed the grade at $119/mt Nov. 21, showed S&P Global data.

"This is not about coal, this is about the importance of base load energy and if coal or nuclear or even gas is an important base load for Western Europe then so be it," Manook said.