In an unexpected move industrial giant GE pledges to exit the coal market and pursue greener forms of energy.
GE stated it would close or sell off coal based sites as it began to prioritise it’s renewable energy and power generation businesses.
This is in sharp contrast with President Trump’s emphasis on “beautiful clean coal” and despite the President lowering standards for coal emissions.
This decision also comes ahead of a US Presidential election, and Joe Biden’s clean $2 trillion energy proposal.
Just over a year ago The Natural Resources Defence Council released an article slamming GE for it’s greed in profiting off what was for many parts of the world an outdated energy source.
Unsurprisingly then the NRDC said it was “about time” in response to GE’s latest move towards greener economics.
However, pursuing renewable energy sources was not necessarily a move towards saving the planet so much as a move motivated by profit.
Russell Stokes, GE’s senior vice president, said: “With the continued transformation of GE, we are focused on power generation businesses that have attractive economics and a growth trajectory.”
Clearly coal is no longer one of these, although Stokes went on to say that GE would continue to support it’s existing customers in maintaining their coal fired power plants.
Why is coal declining?
The impact of Lockdown has made us all appreciate cleaner air and a healthier environment, but the decline in coal usage is more to do with economics than environmental activism.
Coal fired power plants cost far more money to run than renewables. You have to buy fuel to burn whereas a solar or wind farm is passive, once installed it needs only wind or sunshine to produce energy for free.
Add to that the fact that renewables are now often far cheaper to manufacture than a coal power plant and you start to see why the shift is happening.
When there is a decline in energy demand it is the coal station that will be switched off due to the amount of money needed to keep it running.
This is exactly what has happened during lockdown. According to the International Energy Agency, globally we have gone through the largest decline in coal consumption since the second world war.
The UK did not burn any coal for over two months during lockdown, beating all previous records for coal free power.
The International Renewable Energy Agency (IREA) welcomes the change. Director General, Francesco La Camera commented that, “The impact of Covid in our lives has made it clear to everyone that we need to build a future that is more resilient to shocks, and this will bring us to renewables because they have demonstrated, to be the most resilient way to produce energy.”
Last year renewable energy accounted for 72% of new power expansion according to the IREA, so it would make sense that GE would want to turn it’s attention to such a burgeoning industry.