Saturday, 12 May 2012

Coal still the most cost-effective baseload fossile fuel in Europe

In spite of all the EU greentalk, the much maligned coal is still the most cost-effective fossile fuel for baseload power in Europe - and its helping to alleviate the economic slump created by the failed common currency:

At the same time, profits based on benchmark German prices for electricity generated by coal-fired plants have risen by around 30 percent since the beginning of the year to their highest levels since 2008 and could lead to a 13.5 percent year-on-year jump in German hard-coal power production, Reuters research shows.
"If you have anything that's coal-fired in your generation park at the moment - be it lignite or hard coal - you will take advantage of the high margins and burn the stuff," a trader with a major German utility said.
Utilities in Germany, Europe's biggest power market and economy, have constantly increased their use of coal-fired plants since the beginning of the year.
Coal-fired generation has been strong through the winter and so far into 2012 in Germany, Britain, Italy and the Iberian peninsula, because high gas prices have made coal the most cost-effective fossil fuel for baseload power.
Usually there is a seasonal slump in coal generation in the spring and summer months before it picks up again in the autumn, but this pattern may not occur this year in these countries if coal keeps its edge.
What about the "green" energy sources, praised by all politically correct EU politicians and executives? Well, the guys at Barclays Capital have done some deep research on this: 
Barclays Capital said in a research note that stronger seasonal winds and longer, sunnier days would help wind and solar power generation take a larger share from coal burn in the summer.
Yes, we can rely on wind and solar power - if the sun is always shining and the wind is constantly blowing.

Due to the Merkel government´s "Energiewende" (energy transition policy), the future of coal in the German energy mix seems safe, if Germany intends to retain the same degree of energy independence as now. In case shale gas exploration is also forbidden - which appears likely - there are no other credible alternatives. 
Read the entire article here

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