Eurocoal ‘Death Spiral’ Pushes Utilities to Much Faster Plant Closures
European power producers stand to lose €22 billion by 2030 if they don’t wind down their coal-fired generating stations faster than they currently plan to, the non-profit shareholder accountability organization Carbon Tracker finds in an analysis.
The group analysed revenues and operating costs for all 619 coal plants running in the European Union, the Guardian reports, and found that 54% are already losing money. And “stricter air pollution rules and higher carbon prices are set to push even more into unprofitability,” the outlet writes.
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Although the EU must phase out all coal burning to meet the world’s Paris climate commitments, the Guardian reports, Carbon Tracker determined that utilities currently plan to shutter only a quarter of their facilities.
In a perverse game of financial chicken, “companies continue to run loss-making plants in the hope that competitors will close their plants first, or that governments will provide subsidies in return for guaranteed power,” a controversial step the U.S. administration has proposed.
The industry’s reluctance to accept that it is in a “death spiral” and plan for an orderly exit from coal means its losses will pile up over the next decade, “with 97% of plants losing money by 2030,” the non-profit watchdog group asserts.