More bad news for coal

[santafe2]

Alberta's carbon tax will be implemented in 2017. In 2017 the tax will be $20 per tonne rising to $30 per tonne in 2018 and rising 2% plus inflation from then on. While the legislation places a cap on emissions from oil sands production at roughly 40% above current emissions levels, emissions from coal production is slated for complete phase out by 2030. The video attached to the first link below is interesting. Environmental interests are represented and oil energy interests are represented. It's a real kumbaya moment unless you're in the coal industry.

http://www.cbc.ca/news/canada/calgar...ness-1.3330391

http://www.macleans.ca/economy/econo...as-carbon-tax/

And I came across several stories about coal in China that are at odds with the conventional Western idea that China will not curtail use of coal as a primary energy source. It's an opportunistic time for China to begin moving away from coal as they must shutdown excess capacity anyway. That excess capacity will apparently be in the coal industry.

China will suspend the approval of new [coal] mines starting in 2016 and will cut coal’s share of its energy consumption to 62.6 percent next year, from 64.4 percent now, Xinhua News Agency reported Tuesday, citing National Energy Administration head Nur Bekri.

http://www.bloomberg.com/news/articl...ollution-fight

[GRG55]

Re: More bad news for coal

Alberta's carbon tax will be implemented in 2017. In 2017 the tax will be $20 per tonne rising to $30 per tonne in 2018 and rising 2% plus inflation from then on. While the legislation places a cap on emissions from oil sands production at roughly 40% above current emissions levels, emissions from coal production is slated for complete phase out by 2030. The video attached to the first link below is interesting. Environmental interests are represented and oil energy interests are represented. It's a real kumbaya moment unless you're in the coal industry.

http://www.cbc.ca/news/canada/calgar...ness-1.3330391

http://www.macleans.ca/economy/econo...as-carbon-tax/

And I came across several stories about coal in China that are at odds with the conventional Western idea that China will not curtail use of coal as a primary energy source. It's an opportunistic time for China to begin moving away from coal as they must shutdown excess capacity anyway. That excess capacity will apparently be in the coal industry.

China will suspend the approval of new [coal] mines starting in 2016 and will cut coal’s share of its energy consumption to 62.6 percent next year, from 64.4 percent now, Xinhua News Agency reported Tuesday, citing National Energy Administration head Nur Bekri.

http://www.bloomberg.com/news/articl...ollution-fight

Ya gotta love the MSM spin. You'd think Alberta was one vast oilsands tailing pond.

You wouldn't know it from the articles, but Alberta already had a carbon tax of $15 per tonne.

The increase to $20, which went into effect yesterday (not next year) and then $30 (in 2107) was announced by the new NDP government last June, at the same time it announced more stringent reduction targets for large emitters and a climate change policy review panel chaired by University of Alberta economist Andrew Leach. These were just the first steps in the new government's climate change policy implementation.

There's a lot of things converging that are driving this: public opinion across the political spectrum left to right (the right's argument is that taxation is more effective than regulations); the government's pressing need to replace tax revenue from collapsing petroleum royalties (at $30/tonne the carbon tax on natural gas will be higher than the current netback price at the wellhead for producers); the political reality that this left-leaning government's votes and seats were heavily from urban ridings (no coal mines or oilsands in Calgary or Edmonton); the need to encourage new reasons to invest and new sources of job creation to replace the dying traditional economic drivers in the Province; the oil sands industry's belated recognition that the "dirty oil" sobriquet can actually impair business (the oil industry are the worst PR managers worldwide) are just a few of these.

One of the most interesting things is going to be how the government handles the incentives for renewable energy. Harvesting the wind (turbines) or the sun (solar) is simply another resource extraction business. The debate centres around whether these investors should have government assured revenue security for the capital they put at risk...a benefit that no resource industry in Alberta (energy or otherwise) has ever enjoyed historically. The Ontario example should be a lesson for everyone as to how badly that sort of policy mistake can go wrong - but the NDP government and its voters are "Liberals in a hurry" so it remains to be seen what they will do. Hopefully they will take into consideration Alberta installed its first commercial wind turbine farm in 1993, currently has almost a thousand industrial wind turbines in place with a generating capacity of 1,500 MW, and thereby manages to avoid the relentless increases in power costs that the Ontario Hydro and B.C. Hydro monopolies are imposing on their customers and economies. The fact this Province of 4 million people is planning for a $6.1 Billion budget deficit this year (and endless deficits for years to come) might be a tempering influence.

As for China and coal, one would have to believe the air pollution issues are part of the incentive to make changes. We'll see how serious China is to get off the coal consumption (as opposed to coal production) trendline in the face of a worsening economy. China is not a "cheap" producer any more. It is also shuttering iron ore production as it can buy higher quality ore at lower prices than it can mine its own now - subsidies for inefficient production are becoming increasingly problematic in the current economy it would seem.