CIAB Market & Policy developments 2005/06 - IEA

1 HIGH LEVEL MESSAGES
1.1 CIAB Policy Advice
1. Growth in coal use continues to be substantial and there is still the incentive for industry
to invest in coal production capacity when future demand is demonstrated.
2. 2007 has shown further evidence of temporary bottlenecks in international coal transport
infrastructure and international price escalation as the demand for coal and shipping
continues to increase. However, the international coal market continues to be
fundamentally competitive.
3. Each successive year’s experience reinforces the realisation that coal has a long-term
role in a sustainable energy future, to fuel the rapidly developing electricity and energy
needs of developing economies and to contribute to global energy security.
4. Against a background of rising global energy demand and a continued reliance on fossil
fuels for the next twenty-five years, illustrated by future energy scenarios from the IEA’s
“World Energy Outlook 2007”, the CIAB draws attention to the additional challenge to
future energy security created by the need to address climate change.
5. Moreover, switching away from the use of coal in developed economies is not an
adequate response to global climate concerns: in the short term heavy industry and its
associated CO 2 emissions may merely transfer to developing economies; and ultimately
carbon capture and storage will be required to stabilize GHG concentrations in the
atmosphere, whatever fossil fuel is used.
6. Faster and more dramatic improvement in coal’s environmental performance is feasible
now and should continue to be a high priority for industry and government. Developed
and developing countries need to work together to ensure that existing and future clean
coal technologies are deployed at an accelerated rate.
7. Governments and industry are increasingly supporting R&D on the technology of low
emission coal plants, but much higher rates of investment are needed, and collaborative
efforts between governments and industry to demonstrate at large scale the operation of
these plants and reduce their costs need to be re-doubled. There is a continual need to
reduce the efficiency penalty of carbon capture and storage (CCS) and to promote
efficiency improvement through the whole energy value chain, including through the
deployment of new, efficient, electricity generating technologies. Work on designing new
plant to be carbon capture ready should be accelerated. Further clean coal technology
discussion and policy recommendations can be found in the following Section 1.2.
8. The efficient deployment of these new technologies in both developed and developing
economies is necessary to support the continued responsible use of coal globally. For
developing countries, the incremental costs need to be addressed through post-2012
Kyoto mechanisms and the scope of the Clean Development Mechanism (CDM) must be
widened to include abatement achieved through carbon capture, utilisation and storage
as well as other advanced coal technologies.
9. The CIAB also stresses the need to address CO 2 emissions from the current build of
conventional PF coal fired power plant, including mechanisms for incentivising
developing countries, and supports the IEA position on the need to examine the potential
for post combustion capture to be retrofitted to these plants as well as existing gas-fired
generating units.
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