Why coal is cheaper in China
Alternatives to coal are at a severe disadvantage in China:
These are the realities faced by companies seeking to make themselves more environmentally friendly in China, where coal is king. Coal-fired plants are quick and cheap to build and easy to run. While the Chinese government has set goals for increasing the use of a long list of alternative energies — including wind, biomass, hydroelectric, solar and nuclear — they all face obstacles, from bureaucracy to bottlenecks in manufacturing.
The problem is particularly acute because governments across Asia, from China and India to Indonesia and the Philippines, are turning mainly to coal to meet their soaring electricity needs and prevent blackouts, even though coal produces more global warming gases than any other major source of electricity.
China’s increase has been the most substantial. The country built 114,000 megawatts of fossil-fuel-based generating capacity last year alone, almost all coal-fired, and is on course to complete 95,000 megawatts more this year.
… coal’s problems are nothing compared with the challenges facing the wind-energy industry, which requires much more land and is troubled by years-long shortages of a wider range of parts, as well as contradictory regulatory policies. For instance, Beijing has mandated that power transmission companies pay at least 6.5 cents per kilowatt hour to buy wind-generated electricity from approved power producers, not much above the 4.5 cents an hour they pay for coal-generated power. But the premium is so small that only one-third of 1 percent of the nationally regulated wind power projects approved in 2004 have actually been built, and none of those approved in the last two years, said Vivek Kher, a spokesman for Suzlon Energy, an Indian manufacturer of wind turbines.
One of the strangest features of China’s energy policy is the paucity of environmental controls on coal-fired plants, because rules governing them were written long ago. Renewable energy projects actually face a more stringent review of their environmental impact.
Let’s remember, when we say “coal is cheaper,” we’re not describing some intrinsic feature of the mineral. We’re referencing a network of social, political, and economic practices. Insofar as coal really is cheap (true in China, not the in the U.S. any more), it is cheap because it is privileged — not the other way around.