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THE UNIVERSITY OF NEW SOUTH WALES • S YD N E Y  AUSTRALIA

CEIC4000 Environment & Sustainability

Input Analysis of Global Electricity Generation


A review of major ecosystem inputs and the sustainability of coal

Assignment 2a
(See Section 7 for Part 2a)

Greg Greenman
University of New South Wales
6May 2011
INPUT ANALYSIS OF GLOBAL ELECTRICITY GENERATION 2
Table of Contents
Glossary...............................................................................................................................................2

1. Introduction.................................................................................................................................3

2. Scope.............................................................................................................................................3

3. Method.........................................................................................................................................3

4. Past, present and future.............................................................................................................4

5. Major Ecosystem Inputs.............................................................................................................6


5.1. Coal........................................................................................................................................6
5.2. Natural gas............................................................................................................................7
5.3. Uranium................................................................................................................................8
5.4. Crude Oil..............................................................................................................................9
5.5. Fresh Water........................................................................................................................10
5.6. Comparitive Analysis.........................................................................................................13

6. Major Human Activity Inputs.................................................................................................14


6.1. Built Infrastructure...........................................................................................................14
6.2. Transport............................................................................................................................15
6.3. Skilled Human Resources..................................................................................................15

7. Sustainability of Coal................................................................................................................16
7.1. Research analysis...............................................................................................................16
7.1.1. Definitions.....................................................................................................................16
7.1.2. Reserve measurements...................................................................................................19
7.2. Hard Sustainability Metric...............................................................................................19
7.3. Competing Uses of Coal.....................................................................................................20

8. Conclusion.................................................................................................................................22

References.........................................................................................................................................23
References
Glossary

Coal includes primary (hard coal and brown


coal) and derived fuels

Crude Oil limited to crude oil, natural gas


liquids, and refinery feedstocks

Gas includes natural gas (excluding


natural gas liquids)

Gt Gigatonne (One billion tonnes)

Mtoe million tonnes of oil equivalent

TWh terawatt hour


1 TWh = 0.086 Mtoe

INPUT ANALYSIS OF GLOBAL ELECTRICITY GENERATION 1


1. Introduction

Over the last century there has been unprecedented economic and industrial growth throughout the
world, powered by the equally impressive development of electricity generation and transmission.
Much of the generation capacity of the world has been made possible through the discovery and
extraction of fossil fuels including coal, natural gas, and crude oil which are then burned to create
steam in a thermoelectric process. In addition, the nuclear arms race in the 20 th century brought
about a new form of electricity generation by utlizing the large energy potential in Uranium. A look
at the global trends in generation will help to highlight the importance of understanding the amount
of ecosystem inputs presently required in a world with increasing electricity demands.

2. Scope

For the purpose of this review it will not be necessary to conduct a close alaysis into how electricity
is genererated. The scope consists of a basic look into the various types of fuel that go into
electricity generation, their total annual generation and share of that generation. These fuels include
coal, natural gas, uranium, and crude oil. After looking at fuel use, an accounting of water
consumption during various forms of electricity generation will be presented followed by a review
of other major human activity inputs into electricity generation.

3. Method

Research was conducted using online sources of energy statistics, primarily from the International
Energy Agency (IEA) and the U.S. Energy Information Administration (USEIA). These agencies
maintain detailed and extensive data on the world’s generation and consumption of electricity,
which is the main reason for their data being represented in this review.

In the case of fresh water consumption during electricity generation, a report by two U.S.
researchers (Fthenakis & Kim, 2010) was chosen as a reference based on theirthurough analysis of
water use in U.S. electricity generation. The requirements of different forms of electricity
generation in the U.S. were used as an representative of worldwide generation.

INPUT ANALYSIS OF GLOBAL ELECTRICITY GENERATION 1


4. Past, present and future

In the past 35 years, electricity generation has seen anaverage annual growth rate of 3.5% in the
world, rising from 6,129 TWh in 1973 to 20,269 TWh in 2008 (IEA, 2010a). Historically, North
America and Europe have been the major producers of electricity meeting the demands of industrial
growth and commercial expansion, but starting in the 1980s Asia & Oceania began to catch up.
Mostly due to economic reform and resulting economic growth in China, the amount of electricity
generation in Asia then accelerated in the early 2000s and surpased all other world regions in total
electricity generation by the year 2003 (Figure 1).

Figure 1. Total Electricity Generation by Region 1980-2008

Source: USEIA, 2011

The upward trend in electricity generation has translated into increasing demands on the various
forms of resources required keep the world’s power plants operating. In 2008, the use of coal-fired
power plants made up the largest share of electricity generation at 41% followed by natural gas,
hydro, nuclear, oil and renewables (Figure 2). Looking forward to 2035 there will be large
increases in renewable electricity generation, but coal, natural gas and uranium are also projected to
experience growth in demand as the developing countries of the world continue to invest in
economic growth and development (Figure 3).

Figure 2. Share of World Electricity Generation by Fuel

Source: IEA, 2010b

Figure 3. World Electricity Generation Projections (2007-2035)

Source: U.S. EIA, 2010

The observations of electrcity generation and fuel requirements over the last several decades and
projections into the near future gives us a clear understanding that the demands on Earth’s
ecosystems will only increase unless major shifts in energy policy direct investment and
commitment towards transitioning into renewable energy based society. In addition, projections

INPUT ANALYSIS OF GLOBAL ELECTRICITY GENERATION 1


such as the one given by the U.S. Energy Information Administration raise questions of whether
electricity generation is sustainable in a resource constrained world. The devestating effects of
exploiting natural resources for electricity generation are far reaching and often the true costs of
using fuels such as coal, natural gas, uranium, and crude oil are not accounted for or even reflected
in electricity costs. For now however, we will focus on the major ecosystem inputs into worldwide
generation of electricity while comparing their relative significance.

5. Major Ecosystem Inputs

The complexity of the electricity generation industry results in there being several “inputs” upon
which the consistant and reliable supply of electricity depend on. The major ecosystem inputs are
the very fuels that drive the thermoelectric processes which most power plants operate by. These
fuels are mainly coal, natural gas, uranium and oil which are all resources that have to be extracted
from mines, wellsor resevoirs through energy intensive methods.The consumption of water is also
required for almost every form of electricity generation, putting stresses on the global supply of
fresh water. In this section, the major fuel and water inputs into world electricity generationwill be
briefly analyized and quantified.

1.1. Coal

The world’s main source of electricity comes from coal-fired power plants, accounting for about
41% of generation.In 2008, coal power plants generated 8,263 TWh of electricity requiring large
amounts of coal to be mined to supply the demand for the fuel. The total amount of coal consumed
for electricity generation is equivelant to 1,891 Mtoe annually(Table 1).The basic operation of a
coal-fired power plant is represented in Figure 4.

Table 1. Annual Electricity Generation and Fuel Use (Coal)


Generation
Fuel Input (Mtoe)
(TWh)
Coal 8,263 1,891
Source: IEA, 2010b

Figure 4. Coal-fired power plant operation

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Source: http://www.tva.gov/power/coalart.htm

1.1. Natural gas

As the world’s second largest source of electricity natural gas has been been pivitol in meeting the
supply needs of many nations. The ability for natural-gas combined cycle power plants to meet
mid-day peak demands of power hungry cities and regions helps explain the growing demand for
this fossile fuel (USEIA, 2010). The world wide total of electricity generation totaled 4,309 TWh
(21% of global generation), requiring 630 Mtoe of natural gas (Table 2). There are a few different
types of natural gas power plants, some incorporating combined-cycle methods which recycle waste
heat for added generation capacity or use as heat.Figure 5 gives a simple example the operation of a
gas (and oil) power plant.

Table 2. Annual Electricity Generation and Fuel Use (Natural Gas)


Generation (TWh) Fuel Input (Mtoe)
Natural Gas 4,309 630
Source: IEA, 2010b

Figure 5. Oil/Gas power plant operation

INPUT ANALYSIS OF GLOBAL ELECTRICITY GENERATION 1


Source: http://www.tva.gov/power/cumb_turbineart.htm

INPUT ANALYSIS OF GLOBAL ELECTRICITY GENERATION 1


1.2. Uranium

Over the previous 50 years nuclear power established itself as a major source of electricity. In the
21st century nuclear generation is gathering support around the world as the need for low-emission
alternatives to fossil fuelsand a diversified electricity mix becomes more evident. However, there
are still major concerns regarding construction costs, waste disposal, plant safety and security issues
with weapons proliferation (USEIA, 2010). Despite these concerns, and even after the recent post-
tsunami nuclear incedent in Japan, it is likely that nuclear power will continue to be a primary
source of electricity throughout this century.

In a similar way to fossil fuel generation, nuclear power plants operate through a thermoelectric
process. The unique fuel cycle process involved in nuclear power makes it one of the most complex
forms of electricity generation, from the mine to waste disposal (Figure 6).

Figure 6. Fuel cycle of Uranium and Nuclear Power

Source: Commonwealth of Australia, 2006

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In 2008, nuclear power generated 2,731 TWh of electricity, about 13% of the world total. In order
to power the nuclear reactors 50,772 tonnes of uranium (or 812 Mtoe) needed to be mined in 2008
(Table 3).

Table 3. Annual Electricity Generation and Fuel Use (Nuclear)


Fuel Input – Uranium
Generation (TWh)
Mtoe tonnes
Nuclear (Uranium) 2,731 812 50,772
Source: IEA 2010b, World Nuclear Association 2010

1.3. Crude Oil

At 6% of worldwide electricity generation the use of oil in the electricity industry is relatively
small, generating 1,111 TWh in 2008. In order to produce this electricity, oil-thermal power plants
consumed 24 Mtoe of crude oil, or 24,003 kt (Table 4).

Table 4. Annual Electricity Generation and Fuel Use (Crude Oil)


Fuel Input – Oil
Generation (TWh)
Mtoe kt
Crude Oil 1,111 24 24,003
Source: IEA, 2010b

Liquid fuels, such as oil, are the only source of energy that doesn’t see worldwide annual growth for
electricity generation (IEA, 2010a). With oil prices expected to continue to increase in the coming
years and decades, most countries are responding by reducing or removing their use of oil for
generation. While some nations in oil rich regions may actually increase their use of oil for
generation, the declines in the more energy intensive nations will continue to reduce oil’s share in
the production of electricity (USEIA, 2010). Even though oil is unlikely to be a major player in the
world’s electricity mix, it still remains absolutely pivitol to electricity generation by powering the
massive transportation networks and the globalised economy that drive the growth of energy supply
and demand.

INPUT ANALYSIS OF GLOBAL ELECTRICITY GENERATION 1


1.4. Fresh Water

The use of water in the generation of electricity is currently unavoidable and is a major resource
input for the electric power industry. In the constructs of electricity generations there are two types
of water use: withdrawl and consumption.

Withdrawal: the amount of water removed from the ground or


diverted from a water source for use.

Consumption: the amount of water that is evaporated, transpired,


incorporated into products or crops, or otherwise
removed from the immediate water environment.

(Hutson et al, 2004)

Water is withdrawn and consumed at every level of the fuel cycle. This makes for a highly
complex system which is difficult to quantify (Fthenakis &Kim, 2010). For the purpose of this
review however, we will only be looking at the water consumptionof the major types of electricity
generation since it is a better measure of the actual input of fresh water that is required and
removed from the local hydrological cycle (Figure 7).

Figure 7. Fuel cycle water flows in electricity industry

Source: Extracted from Fthenakis & Kim, 2010

By looking at annual electricity generation totals recorded by the International Energy Agency in
2008 and cross analysing with consumption estimations by Fthenakis et al, a general view is formed
of how much water is consumed by different sources of electricity generation (Table 5).In one

INPUT ANALYSIS OF GLOBAL ELECTRICITY GENERATION 1


year,between 4,858,225 and 114,852,566 million liters of water is consumed by the power plants
that generate the world’s electricity.

Table 5. Freshwater consumption of electricity generation by energy source (2008 data)


Electricity Gen Consumption Annual Total
(TWh/year) Million L per TWh Millions of Liters
Low High Low High
Coal 8,263 242 4,430 1,999,646 36,605,090
Gas 4,309 76 1,900 327,484 8,187,100
Hydro 3,288 38 17,000 124,944 55,896,000
Nuclear 2,731 530 3,400 1,447,430 9,285,400
(Crude) Oil 1,111 341 3,100 378,851 3,444,100
Renewables (RE) 550 / / 579,870 1,434,876
Geothermal 65 2,300 15,000 149,500 975,000
CSP 1 300 3,800 270 3,420
RE PV 12 0 15 0 180
Wind 219 0 4 0 876
Biomass 253 1,700 1,800 430,100 455,400

Total 4,858,225 114,852,566

Note: Low and High represent the uncertainty in the values of water consumption for electric power plants.
Sources: (Fthenakis& Kim, 2010) (IEA, 2010a)

Since humans require about 2 liters of water per day, in one year the electricity industry consumes
an estimated12 times the fresh water requirements of the entire 6.9 billion human population
(assuming an average between “low” and “high” consumption rates). This is an extrodinary amount

INPUT ANALYSIS OF GLOBAL ELECTRICITY GENERATION 1


of fresh water being consumed and removed from resevoirs such as wells, lakes,streams and oceans
and the natural balance of the water cycle as a whole.

From Table 5 it is clear that coal, nuclear, and hydro electricity generation has the largest impact on
global water cycles, largely due to the fact that they are the among the most common sources of
electricity.However, they also have relatively high consumption rates relative to gas and most of
the renewables. Realizing the percentage share of water consumption from various types of
electricity generation (Figure 8) helps identify which fuels are of of greater concern to the
sustainability of electricity generation in relation to impacts on surrounding ecosystems.

Figure 8. Percentage share of water consumption in electricity generation by fuel

Low Estimate High Estimate


Note: The wide range in hydro’s consumption is due to the complex
and uncertain data compiled in Fthenakis & Kim, 2010.

As electricity generation is predicted to experience continued growth this century, looking at water
use will be critical in the decision processes of policy makers and regulators. In addition to the
desire for emission free technology, water scarcity issuesare putting more emmphasis and support
behind low water use technologies such as wind and solar PV (World Economic Forum, 2009).

INPUT ANALYSIS OF GLOBAL ELECTRICITY GENERATION 1


1.5. Comparitive Analysis

We have looked at the major fuel inputs into electricity generation and their respective consumption
of water during the generation process. The result of this analysisis presented in Table 6.

Table 6. Comparison of fuels in the worldwide electricity mix (2008 data)


Mean Water
Generation Percent Percent
Consumption
TWh of Total of Total
(Millions of Liters)
Coal 8,263 41% 19,302,368 32%
Gas 4,309 21% 4,257,292 7%
Nuclear (Uranium) 2,731 13% 5,366,415 9%
Oil 1,111 6% 1,911,476 3%

The dominance of coal in the electricity mix is fairly well established and is represented by its 41%
share of generation. Gas, nuclear and oil make up 40% collectively, while the remainder comes
from hydro and renewable energy sources. The particular water requirements of coalpower plants
results in massive amounts of water consumption compared to the other fuels.

INPUT ANALYSIS OF GLOBAL ELECTRICITY GENERATION 3


2. Major Human Activity Inputs

In addition to the ecosystem inputs outlined in the previous section, there are many human activity
inputs upon which the electricity industry depends. The industry as a whole is highly complex and
is integrated into a social and economic system where dependence on various resources and
activities are prevelant. Built infrastructutre, transport, and skilled human resources are among
some the more critical human activity inputs in electricity generation. Understanding the
fundamental importance of each is important in order to gain an appreciation for the
interdependence of these human activities (Figure 9).

Figure 9. Interdependence of select human activites

1.1. Built Infrastructure

Defining built infrastructure as office buildings, factories, roads, railways, shipping ports and
transmission networks immeditately illustrates the dependence electricity generation has on these
inputs. Office buildings and factories house the skilled professionals and laborers that support the
vast array of products and services that the industry depends on. Roads, railways and shipping
ports make possible the transportation of fuels from the mine, well, or resevoir to the power plant.
Transmission networks supply the electricity to the buildings, factories, railways and shipping ports,
without which the industry would not be able to operate. Built infrastructure is therefor a critical
component in generating electricity.

1.1. Transport

Transportation in relation to a wider network comprised of, but not limited to, cars, trucks, ships,
trains, and airplanes is another fundamentally important input for electricity generation. The
transport of fuel in addition to the transport of other goods, services and people are vital
components in the smooth operation of a all types of power plants. Of course, for renewables such
as wind, solar, geothermal, and hydro there is no need for the “fuel” to be delivered to the site of
generation, causing these technologies to be slightly less dependanton transport than other types.

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1.2. Skilled Human Resources

Electricity power plants require many support systems to function effectively including skilled
human resources in the form of a workforce. The workers that build, operate, and maintain power
plants are ultimately reponsibile for the safe and consistent generation of electricity, making skilled
human resources a integral component in the greater construct of the industry.

It is also important to understand that while skilled human resources are required, there are
sometimes large amounts of human risk involved. The activities involved in electricity generation,
and the energy industry as a whole, result in fatalities that have a large direct human impact on
families and communities (CERI, 2008). In about three decades almost 12,000 people lost their
lives in the coal, natural gas, hydro and nuclear industries alone (Table 7).

Table 7. Comparison of energy related accidents in energy production (1969-1996)


Fuel Immediate Fatalities Who?
Coal 6400 Workers
Natural Gas 1200 Workers & Public
Hydro 4000 Public
Nuclear 31 Workers
Source: Reproduced from CERI, 2008

2. Sustainability of Coal

The world’s reliance on coal for electricity generation is unequivocal at a 41% share of production.
With electricity demand predicted to increase in the 21st century, consequently resulting in an
increase in demand for coal, the production of this fuel is dependent on technology, economics, and
availability. In fact, all three of these aspects are interconnected and ultimately it is technology and
economic considerations that determine the availability of coal (Höök and Aleklett, 2010). This
section of the report will present a comprehensive review of various studies that have been
conducted to determine the amount of remaining coal reserves, followed by an analysis of coal’s
hard sustainability metric.

INPUT ANALYSIS OF GLOBAL ELECTRICITY GENERATION 1


1.1. Research analysis

The future availability of coal has been a source of debate among industry experts and academics
for much of the last three decades. The general assumption has been that there is enough coal to
support increasing coal consumption well into the future (Höök and Aleklett, 2010). The abundance
of coal is sometimes regarded as a great benefit in regards to stepping in as a substitute for
dwindling oil and natural gas supplies, or as an environmental nightmare that will result in a large
increase of CO2 emissions and enhancing the risk for catastrophic climate change (World Energy
Council, 2007). Arriving at an accurate conclusion to the question of how much coal is left is
ultimately left to interpretation of available data and the influence of the many factors that
determine the availability of coal. However, it has been found that data for the quality of coal and
available resources is very poor therefor any conclusion on coal reserves needs to be approached
with analytical discretion (Patzek & Croft, 2010). Before we look at previous research on coal
reserves, we must first understand how reserves are defined and measured as well as look the
concepts that determine their extraction.

1.1.1.Definitions

Reserves and Resources


Definition of reserves according to the World Energy Council (2007):

Proved amount in place is the resource remaining in known deposits that has been carefully
measured and assessed as exploitable under present and expected local economic conditions
with existing available technology.

Proved recoverable reserves are the tonnage within the proved amount in place that can be
recovered in the future under present and expected local economic conditions with existing
available technology.

Definition of resources according to the World Energy Council (2007):

Estimated additional amount in place is the indicated and inferred tonnage additional to the
proved amount in place that is of foreseeable interest. It includes estimates of amounts that
could exist in unexplored extensions of known deposits or in undiscovered deposits in
known coal-bearing areas, as well as amounts inferred through knowledge of favorable
geological conditions. Speculative amounts are not included.

INPUT ANALYSIS OF GLOBAL ELECTRICITY GENERATION 1


Estimated additional reserves recoverable is the tonnage within the estimated additional
amount in place that geological and engineering information indicates with reasonable
certainty might be recovered in the future.

It is important to be aware of are the use of the words expected, might, and existing available
technology in the above definitions. There is a great degree of uncertainty in making calculations of
coal reserves that has historically been proven to often over-estimate proved recoverable reserves
(Mohr & Evans, 2009). On the other hand, there is the possibility for new advanced technology to
make extraction cheaper, easier, and more cost effective, therefore increasing the amount of proved
recoverable reserves. The fact remains, however, that we are dealing with highly uncertain data
from multiple sources, which should be approached objectively.

One problem with using tonnage as a basis for recoverable reserves is that there are many different
types of coal, each with their own specific energy content. For example, the most common
definition of energy content is from the IEA (2009):

Anthracite: 30 MJ/kg
Bituminous coal: 18.8–29.3 MJ/kg
Subbituminous coal: 8.3–25 MJ/kg
Lignite: 5.5–14.3 MJ/kg

The differences in energy content is very important when looking at recoverable reserves because
most studies report this statistic in tonnage, while ignoring the actual energy content of the
remaining reserves. Over the last one hundred years the most energy dense types of coal (Anthracite
and Bituminous) have been depleted at a much greater rate than less energy dense types, leaving
many countries with a majority of reserves being Sub-bituminous and Lignite coal (Kavalov and
Peteves, 2007).

In order to account for the energy content difference, a conversation is made for reserve
comparisons while also accounting for the energy required to extract the coal in the first place.
Limits on energy sources, such as coal, are determined by the laws of thermodynamics and energy
balance relations. Energy sources, in other words, must produce more energy than it required to
extract and transport the resource in the first place. This concept is represented by the equation for
energy-returned-on-energy-invested (EROEI):

INPUT ANALYSIS OF GLOBAL ELECTRICITY GENERATION 3


EROEI=Useable Energy AcquiredEnergy Expended

The production of coal demands many energy intensive processes and machines, and at a certain
point in the mining of coal these processes become too energy intensive to produce economical
EROEI (Höök and Aleklett, 2010). Unfortunately for the environment, coal has a far superior
EROEI than most other sources of energy, which is the main reason that it has such a large share of
the world’s electricity generation. However, there is a limit to extraction that EROEI puts on coal
and other natural resources. Dr. M. King Hubbert, the man who first conceptualized “peak oil”,
once said:

“There is a different and more fundamental cost that is independent of the monetary price.
That is the energy cost of exploration and production. So long as oil is used as a source of
energy, when the energy cost of recovering a barrel of oil becomes greater than the energy
content of the oil, production will cease no matter what the monetary price may be.”
(Hubbert, 1989)

Certainly, advancements in technology could potentially continue to increase the efficiency of coal
extraction, but when combined with the limitations of finite reserves there will become a point in
which we will reach the global peak production of coal (Patzek & Croft, 2010). Next we will look
at various measurements of recoverable coal reserves from many difference studies.

1.1.2.Reserve measurements

Over the past decade, a multitude of studies have been conducted on the amount of coal remaining
and available for extraction. In order to gather an empirical assessment on the sustainability of coal
production it becomes vital to look at many of the most scientific studies while remaining aware of
the special interests of the organisations conducting the research. To mitigate the potential for
biased views and differences in definitions, a side-by-side comparison of research has been made of
the world’s recoverable reserves (Table 8).

Table 8. Comparison of studies on Proved Recoverable Coal Reserves


Study Reference World Proved Recoverable Reserves
Ion, 1975 4,640 Gt
Hubbert, 1976 2000-7,600 Gt
WEC, 2002 909 Gt

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Laherrere, 2006 1,200 Gt
EWG, 2007 1100 Gt
WEC, 2007 847 Gt
Rutledge, 2007 660 Gt
Mohr & Evans, 2009 700 Gt
BP, 2010 826 Gt
US EIA, 2010 909 Gt

It can be seen from the above table that proven reserve amounts since the 1970s have significantly
declined, mostly due to the availability of advanced measurement technology and estimation
techniques (Mohr & Evans, 2009).

1.1. Hard Sustainability Metric

A hard sustainability metric for the use of coal is often called a “reserves-to-production ratio” or
R/P ratio. This ratio simply divides the proven reserves by the annual production rate, or
consumption rate (WEC, 2007). For the sake of determining an estimate for the hard sustainability
metric, the value for proved recoverable reserves of 700 Gt is obtained from the comprehensive
study by Mohr & Evans (2009). A production rate of 5.99 Gt/year is from the International Energy
Agency (IEA, 2010b). From these values we can make a very rough estimate to how many years
until coal will be depleted (Table 9).

Table 9. Global Hard Sustainability Metric for Coal


Recoverable Reserves Production (Use Rate) R/P ratio

700 Gt 5.99 Gt/year 117 years

It is important to remember that a hard sustainability metric for coal will have a wide range of
variability depending on which studies are used for reserve and production amounts. In addition,
there are many future variables such as price fluctuations and advancing technologies that can
greatly affect both reserve availability, production, and demand. Because of these complexities it is
near impossible to paint an accurate picture for the hard sustainability of coal. That being said,
there is no doubt that peak production of coal will occur and will likely take place between 2011-
2047 on an energy basis, or 2011-2048 on a tonnage basis (Mohr & Evans, 2009). The peak in coal
production will be followed by a sharp decline, resulting in vastly reduced production 100 years
from now (Figure 10).

Figure 10. Global Coal Production Prediction

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Source: Mohr & Evans, 2009

Experts are certain that the use of coal will be a part of the global energy mix for several decades,
however, as reserves diminish there will be increased competition for this resource depending on
the price, which brings up an interesting scenario for the electricity generation industry. Next we
will look briefly at the competing uses for coal and how electricity generation might be shaped by
availability and price.

1.1. Competing Uses of Coal

The primary use of coal is for the generation of electricity, whether it’s for residential use or
industrial processes such as smelting in steelmaking. In 2010, the power generation industry
consumed 69% of coal produced worldwide, making it by far the most dominant and powerful
consumer of coal (Figure 11).
Figure 11. World Coal Demand by Sector (2004)

Source: IEA, 2010b

The power generation sector is predicted to increase its share of coal demand by 10%, potentially
reaching 79% by 2030, furthering the industry’s competitive advantage over other sectors (IEA,

INPUT ANALYSIS OF GLOBAL ELECTRICITY GENERATION 1


2009). As a result of this analysis, direct competition with other sectors is not a concern for
electricity generation; rather it is competition between nations and economic regions that present
the greatest competitive dilemmas for coal in the 21st century. The proven coal reserves by major
world regions shows how some regions will have competitive advantages over others in the coming
decades (Figure 12).

Figure 12. Proved reserves 2009 (in thousand million tonnes)

Source: BP, 2010 (anthreacite and bituminous in brackets)


Balancing interregional competition and the supply/demand for coal will be a major energy
challenge this century for nations and the electricity industry as a whole. These challenges raise
many issues with energy security for nations with few reserves, while countries such as USA,
Russia, India, China and Australia have an advantage with their large proven reserves (Energy
Watch Group, 2007).

2. Conclusion

This review has given a very basic look at worldwide electricity generation and the ecosystem
inputs required over the course of a year. As one of the highest polluting sectors of the
globaleconomy, the electricity industry presents some of the best opportunities to mitigate
greenhouse gas emissions by reducing the use of fossil fuels and switching to renewable energy
technologies.In the scope of modern society however, water and energy are two of the most
essential services to this human activity and are ultimately acritical component of what has become
an international network of interdependent activities and services within Earth’s collective
INPUT ANALYSIS OF GLOBAL ELECTRICITY GENERATION 1
ecosystem. Understanding the complex nature of these environmental systems and our impacts on
them is a difficult task but is necessary if an sustainable society is to rise from the ashes of self
destructive behaviors and practices.

Reassessment of the sustainability of coal will remain vitally important over the coming decades,
but if immediate and drastic action is to be made on reducing emissions and the resulting impacts of
climate change there will have to be a major reduction in our use of coal for electricity. Renewable
energy technologies such as wind, solar and biomass present the best options for replacing coal as a
source of electricity, leaving out nuclear and natural gas as other alternatives because of their
significant environmental disadvantages. Additionally, many nations are considering placing a
price on carbon emissions that would reduce the economic advantage of coal electricity while
making renewable energy more attractive to industry and investors. Consequently, in the face of
reaching peak production of a finite and highly polluting resource such as coal, there is a strong
argument for governments to push for a price on carbon while heavily investing in renewable
energy infrastructure.

In conclusion, increased understanding of global climate change and other negative local and
regional environmental impacts makes it the ethical responsibility of citizens, businesses,
organizations, and governments to lay the groundwork towards institutionalizing the sustainability
frameworks that are needed.

INPUT ANALYSIS OF GLOBAL ELECTRICITY GENERATION 2


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