Despite multi-billion-dollar energy transition deals agreed with wealthy nations and development banks in 2022, coal use in Indonesia and Vietnam will continue to grow until at least 2030, the International Energy Agency (IEA) forecasts.
In its annual coal report, the Paris-based agency estimates that coal use will rise 4.5% a year between 2025 and 2030 in Southeast Asia, with Indonesia, Vietnam and the Philippines largely responsible for the increase. Coal-heavy India is also set for a 3.3% rise this decade.
Growth in these nations will offset large declines in coal use in developed countries and a smaller fall in China, the IEA said, causing global coal demand to plateau and edge down only slightly by 2030.
For this year, the report finds that global coal demand is set to rise by 0.5%, reaching a record 8.85 billion tonnes. In the US, higher natural gas prices and policy measures slowing the retirement of coal plants lifted consumption, which had been on a downward trend for the previous 15 years, it notes.
Big banks’ lending to coal backers undermines Indonesia’s green plans
When burned, coal’s planet-heating emissions are far larger than other fossil fuels like oil and gas. Quickly reducing the use of coal is critical to meet climate goals, experts say, and countries agreed to phase it down at the COP26 climate summit in Glasgow in 2021.
A group of donor nations launched Just Energy Transition Partnerships (JETPs) in 2021 and 2022 to help accelerate a transition away from coal in key countries like South Africa, Vietnam and Indonesia.
But responding to a question from Climate Home News, Keisuke Sadamori, the IEA’s director of energy markets and security, told a press briefing this week that the JETPs in Indonesia and Vietnam had so far failed to “bend the curve”.
Fabby Tumiwa, head of the Institute for Essential Services Reform (IESR) who advised the Indonesian government on the JETP deal, said the country’s JETP is “stalling” partly because the wealthy country partners have not funded the early retirement of coal-fired power plants.
A draft Indonesian energy plan seen by Climate Home News in August 2023 said Indonesia would retire a sixth of its coal-fired power plant capacity by 2030.
But, after a row over finance with rich nations, that target was dropped from the final version published later that year. Instead, the plan said Indonesia would start shutting down coal plants before their scheduled closure no earlier than 2035.
Tumiwa told Climate Home News that the lack of international funding for early retirement has made it harder for JETP partner countries – including Germany, Japan and the UK – to ask Indonesia to stop building new coal-fired power plants.
Even beyond 2030, early closures look in doubt. Recently, PLN cancelled a plan to shut down the Cirebon-1 coal-fired power plant seven years early in 2035, citing the high cost of compensating the plant’s owner – despite promised financial support from the Asian Development Bank under its Energy Transition Mechanism.
Think-tank IESR argues that the health benefits from shutting down the polluting plant early would outweigh the financial costs, and that keeping the plant open is a sign that the government’s commitment to the energy transition is weakening.
Indonesia’s Chief Economic Minister Airlangga Hartarto said earlier this month that the Cirebon-1 plant is less polluting than others in Indonesia so it would be better to shut down those dirtier, older facilities first.
“Captive” coal growing
Tumiwa said another flaw in the JETP was its focus on coal power stations that provide electricity to the grid rather than “captive” coal power plants which directly power nearby industrial facilities including nickel and aluminium smelters.
By the time those working on the JETP realised that captive coal accounted for a significant chunk of capacity, it was too late to change the JETP’s design, Tumiwa said.
The IEA report said that coal use in Indonesia and Vietnam will rise mainly because of expanding electricity demand driven by economic and population growth. In Indonesia, in particular, the use of coal in industries like nickel and aluminium is increasing, the report added. In Vietnam, the power-hungry manufacturing sector has driven the surge in coal consumption.
In both countries, JETP funding for clean energy has trickled in only slowly. Indonesia’s JETP, which promised to mobilise $20 billion by 2027, has delivered $3 billion so far, mostly as concessional loans. Japan has been by far the largest donor, providing almost $2 billion. In Vietnam, only three projects have progressed to funding arrangements, totaling less than $1 billion.
The IEA report said discussions have “intensified” in Indonesia around energy security, affordability and orderly transition pathways. The country has large reserves of relatively cheap coal and the country’s state-owned electricity company PLN has encouraged investment in coal mining and transportation.
Vietnam has also watered down its plans to shut coal plants and has imprisoned environmental campaigners. In May, European governments announced loans for a transmission line and two hydropower plants under the JETP, but no plans for early coal plant closures.
The post Indonesia and Vietnam set for surge in coal use this decade despite transition deals appeared first on Climate Home News.
Indonesia and Vietnam set for surge in coal use this decade despite transition deals
Climate Change
How to Think About the Extractive Problem of Lithium Mining
Electrification of transportation and the power grid all but require lithium to make batteries—but mining it takes a toll on delicate ecosystems. Still, there are reasons for hope.
From our collaborating partner Living on Earth, public radio’s environmental news magazine, an interview by Paloma Beltran with Thea Riofrancos, the author of “Extraction: The Frontiers of Green Capitalism.”
Climate Change
New panel of climate scientists calls for fossil fuel transition roadmaps
A new panel of experts, bringing together some of the world’s top climate scientists, has called on governments to develop roadmaps for phasing out fossil fuels “anchored in science and justice”.
Launched on Friday in Santa Marta, Colombia, along with a set of 12 initial policy recommendations, the panel’s appeal came ahead of a key ministerial meeting on equitable ways to reduce dependence on coal, oil and gas during next week’s “First Conference on Transitioning Away from Fossil Fuels”.
Sixty countries head to Santa Marta to cement coalition for fossil fuel transition
Presenting the panel’s recommendations in a packed Santa Marta Theatre, Johan Rockström, director of the Potsdam Institute for Climate Impact Research (PIK), said the push for a global transition away from fossil fuels offers “a light in the tunnel” during a “very dark moment” of geopolitical conflict and climate extremes.
“Science is here to serve,” Rockström said. “We’re today launching the Science Panel for the Global Energy Transition (SPGET) as a service, as a global common good for all countries, all sectors, all regions to connect to the best science enabling a transition away from fossil fuels.”
The panel is urging countries to create “whole-of-government” plans to “dismantle legal, financial and political barriers” to the energy transition. Its insights are intended to inform top officials from 57 governments who will gather in Santa Marta for high-level discussions on Tuesday and Wednesday.
Draft roadmap for Colombia
Colombian Environment Minister Irene Vélez Torres said the panel “addresses a longstanding shortcoming” in international climate science, by creating a scientific body dedicated solely to overcoming the world’s reliance on fossil fuels.
“It’s a first-of-its-kind, designed to organise in the next five years the scientific evidence that allows cities, regions, countries and coalitions to take the big leap,” Vélez told the event in Santa Marta.
As an example of how countries can move forward – even when their economies are closely tied to the production and use of dirty energy – a group of European scientists presented a draft roadmap to phase out fossil fuels in Colombia, with inputs from the Colombian government. It will be used as a basis for further consultation in the Latin American nation to define the way forward.
To phase out fossil fuels, developing countries need exit route from “debt trap”
Piers Forster, director of the Priestley Centre for Climate Futures at the University of Leeds and co‑author of the roadmap, said it shows “a clear pathway to economic and societal benefit”, with average annual investment of $10.6 billion producing net economic benefits of $23 billion per year by 2050.
The document says fossil fuels in Colombia can be phased out through energy efficiency measures, coupling renewable generation with energy storage, and switching to electrified transport. But, it adds, the government will need to plan for reduced revenue from fossil fuel exports, which roughly half by the mid-2030s.
“What matters now is moving beyond headline targets to create credible, policy-relevant roadmaps, enabling a just and effective transition,” Forster said in a statement. Brazil is also working on a national roadmap for its own economy, as well as leading a voluntary process to produce a global roadmap.
IPCC hobbled by politics
Currently, the world’s top climate science body – the Intergovernmental Panel on Climate Change (IPCC) – requires countries to sign off on each “summary for policymakers” of its flagship science reports. This has led to a politically fraught process that has increasingly seen some oil-producing governments making efforts to weaken its recommendations.
In a bid to focus scientific debates on the phase-out of fossil fuels, the new SPGET was created based on a mandate from last year’s COP30. It is also meant to come up with scientific recommendations at a faster pace than the IPCC’s seven-year cycle.
Natalie Jones, senior policy advisor at the International Institute of Sustainable Development (IISD), called the new scientific panel “historic”, as it will be “more specific, more targeted and potentially more agile” with its advice on phasing out coal, oil and gas than the IPCC’s exhaustive scientific synthesis reports.
Why the transition beyond fossil fuels depends on cities and collective action
One of the SPGET members, Peter Newell of the UK’s University of Sussex, said “there are many different challenges along the way – and not all of them have to do with lack of evidence”, but the phasing out of fossil fuels “is one part of the story and it’s important to address it”.
The panel will be co-chaired by Cameroonian economist Vera Songwe, PIK’s chief economist Ottmar Edenhofer and Gilberto M. Jannuzzi, professor of energy systems at Brazil’s Universidade Estadual de Campinas. It will be composed of between 50 and 100 scientists divided into four working groups: transition pathways, technological solutions, policies and finance.
Under the 12 insights for the Santa Marta process, the panel recommended banning new fossil fuel infrastructure, mandating “deep cuts” in methane emissions, implementing carbon levies on imports, and de-risking clean energy investments via interventions from central banks, among others.
The post New panel of climate scientists calls for fossil fuel transition roadmaps appeared first on Climate Home News.
New panel of climate scientists calls for fossil fuel transition roadmaps
Climate Change
New loss and damage fund could run out of money next year
Despite not yet paying out any money, a UN-backed fund meant to address the loss and damage caused to developing countries by climate change could face “liquidity issues” by the end of next year, its head warned today.
With ten projects already requesting $166 million in total, the fund’s Executive Director Ibrahima Cheikh Diong warned a board meeting in Zambia that the fund was likely to be “oversubscribed” and should anticipate cashflow problems.
A framing paper prepared by the fund’s secretariat similarly warns that “given the current status of the capitalization of the Fund, there is a risk of the Fund exhausting its capital by the end of 2027, which could result in a loss of operational momentum and expose the FRLD to reputational risk”.
Since governments agreed to set up the fund at UN climate talks in Egypt in 2022, wealthy nations have promised $822 million, but delivered just $449 million.
The fund is expected to approve its first projects at its next board meeting in July. Early proposals submitted include strengthening responses to floods in Bangladesh and the Nigerian city of Lagos, and improving water infrastructure in Jamaica following Hurricane Melissa last year.
Millions not billions
ActionAid Zambia climate justice coordinator Michael Mwansa told the board meeting that he was concerned about “the failure of the Global North governments to deliver on their climate finance obligations, making it largely impossible to scale up [the fund’s initial stage] significantly, if at all”.
“Pledges remain nowhere near the billions and even the trillions needed to address loss and damage to the Global South”, Mwansa added, highlighting reports which found that financing loss and damage could cost developing countries up to $400 billion a year.
The fund’s board discussed its strategy for raising more money at its meeting this week while climate campaigners called, in an open letter, for it to aim to secure $50 billion a year from developed countries starting next year, rising to $100 billion a year by 2031 and $400 billion by 2035.
The World Bank-hosted fund aims to have revenue-raising rounds known as replenishments every four years, with the first in 2027.
Governments have agreed to “urge” developed countries to contribute but only to “encourage” other nations to do so and the fund’s secretariat wants to appoint a “high-level champion” to lead the replenishment team.
The fundraising strategy will be discussed further at the next board meeting in the Philipines in June.
Campaigners’ open letter calls for developed countries to contribute more and for them to introduce taxes on fossil fuel companies, financial transactions, luxury air travel and wealth to raise money for the fund.
“Rich countries must be held strictly accountable for the devastation they have caused,” said Climate Action Network International head Tasneem Essop. “Their failure to fulfil their responsibility to the Loss and Damage Fund is not just an oversight; it is a shameful betrayal of humanity.”
The post New loss and damage fund could run out of money next year appeared first on Climate Home News.
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