COALspot.com - The dawn of the 21st century has seen a shift in the world's commercial balance of power, with the dominance of the US, Europe and Japan challenged by the rapid industrialisation of hungry new economies. The rise of the so-called BRIIC nations - Brazil, Russia, India ,Indonesia and China - is giving birth to new global financial centres, vibrant industrial markets and above all surging demand for raw materials to supply new projects. 

But where does environmental responsibility fit into this drive for resources?

Growing demand  for thermal Coal  has created a new coal boom, which is great  news for Coal producing  countries  such as  Indonesia, Australia , south Africa . The demand of coal is growing at a massive rate in Asia particularly India and China. Both the coal hungry countries are making efforts to secure supplies by acquiring Coal mines or forming Joint ventures for their new power generating plants.

The demand is fuelling the world prices of coal, although prices are still not as high as witnessed in 2008 when everything peaked before the global financial crisis but there all indications that by 2012/2013 coal prises will reach to record high.

The India and China  are becoming the mainstay of the market . Both the countries are having huge Coal reserves ,but still  they are importing  huge qty of coal to meet there increased demand and as such  they are effectively driving the world Coal market and its prices. India’s demand for coal is expected to grow at a faster rate than any other country in the world.

India's rich untapped mineral resources  of more than 20 mineral types - including gold, copper, coal and bauxite but the fact that many of these resources are located in rural, heavily forested areas with predominantly tribal populations has raised concerns over the environmental impact of mining operations.

The country has a long history of environmental damage caused by both domestic and international mining companies, as well as the ecological problems from hundreds of abandoned mines in areas like Bihar's Jharia and Rhaniganj coal fields. Like China, India has been plagued by the environmental problems associated with illegal and unlicensed mining operations, which the country's Directorate General of Mines Safety has been ill-equipped to deal with due to funding deficiencies.

Similarly China has come under fire from human rights activists and environmental groups alike for its arguably lax approach to both worker safety (the country has become the mining disaster capital of the world in recent years) and environmental accountability. The Chinese Government's approach to corporate and environmental responsibility has been characterised by outside observers as simply paying lip service to the environment - hinting that ISO guidelines for mining would be welcomed - without implementing practical measures to promote change. 

The environmental impact of mining operations in Brazil is also under sharper scrutiny than many other countries, primarily because its borders contain the lion's share of the Amazon rainforest, a haven for biodiversity and one of the most important eco-systems in the world.

As such, environmental awareness is particularly strong in the Brazilian mining industry. Experts from the Brazilian Association of Technical Standards are playing a leadership role in the further development of the recently introduced ISO 26000 international standard on social responsibility. Furthermore, licensing for new mining projects is often legally conditional on the drafting of comprehensive environmental impact studies, reports and extensive public consultations, particularly in areas inhabited by tribal groups.

Although carrying out mining operations in a region like the Amazon will be controversial, the environmental commitment seen here and echoed by many other Brazilian mining companies (including industry giant Vale, which has a complex environmental quality management system based on ISO 14001 standards) provides a useful model of awareness for other BRIC nations, and the global mining industry in general, to follow.

India is emerging as a fast economy, targeting 9-10% annual growth. Realizing the underlying growth potential will largely depend on it's ability to meet energy requirements. Energy sector whose growth targets inter alia depend on coal.  At a 9% growth rate, the capacity requirement will be 960Gw and energy requirement will be 4,806 billion kWh. In the light of these projections, coal demand is estimated to rise many fold. Main  concentration of Indian companies remains in Indonesia   as many new mines are opened for  exploration , exploitation and production .Today  Indonesia is one of the most rapidly developing coal producing country in the world.

For a strong economy, one needs strong infrastructure and power plants. For strong infrastructure and power plants , one needs steel. Steel is the backbone of an economy, and it is metallurgical coal and thermal coal that is used to produce  steel and electricity.

An increase in Coal production is the opposite of what the global climate change forums have wanted to see because coal without any doubt is one of the dirtiest and filthiest fossil fuel  in terms of CO2 and when it comes to harmful emissions that most environmentalists and energy economists  agree causes global warming.

Coal consumption is going in a direction that policy makers would prefer it not to go.

Critical question is whether there is  a willingness amongst coal producers and power generating plants  to make their technology cleaner, so it emits less greenhouse gases(GHG) which leads to global warming .Energy scientists have long been voicing concern on the rise in the level of Greenhouse gases, which leads to Global warming and climatic changes that are detrimental to economies worldwide.

The disastrous consequences for global climate change is one topic that has now taken very serious dimension but hardly been realised in a serious enough way by the nations across the world.

The new thermal plants being built are certainly more efficient than older ones. There exist technology to have emission-free power plants - the only constraint is the cost. The cost of clean coal technology is very high, yet when we look at the alternatives to coal, they are even higher than that - for example, nuclear, solar, wind. The real costs of all these alternatives are still to be determined, but there is no doubt that clean coal technologies can double the cost of coal in generating energy.

None of the alternatives appears to be commercially viable right now for required generation of energy without considering subsidies  and tax incentives . If any country accepts sustainable growth and development as the way forward, it subsumes the climate change issues. 

At the same time, no country can ignore the inherent contradiction in the expression ‘sustainable growth’.

Growth essentially involves exploiting natural resources for human benefit and countries have to strike a delicate balance between environmental sustainability and economic growth. It is easier said than done.

As the climate issue impinges on everyone, wisdom demands that nations sink their petty differences in approach and strategy to stem the danger from spreading further and squeezing the survival prospects of one and all.

Principally, the efforts boil down to reduction of greenhouse gas (GHG) emission, caused primarily by accelerated economic development through exploitation of fossil fuels rich in carbon dioxide.

Every action does not need to be official or based on protocols.  In any case, every country need to adopt new methods and ways of doing things in optimising the use of exhaustible resources, energy and water. Corporations / Institutions must carry out energy analysis and incorporate environmental accounting practices to reduce green house gas emission levels at their facilities. The government, in turn, could enforce a form of taxation based on companies’ contribution to climate change.

Climate change is today's biggest problem, threatening mankind with extinction. The problem, largely of man's own doing, must be treated as an emergency by all.

The president of Indonesia issued a Presidential decree instructing all central and regional authorities to support the moratorium by suspending the granting of permits for the use of “primary natural forests” for two years. This Presidential decree is part of Indonesia’s efforts to comply with the bilateral agreement between Indonesia and Norway on forest conservation.

Various governments worldwide are beginning to put regulations in place and to encourage development of more sustainable sources of power generation in order to protect populations worldwide from the immediate detrimental effects on life and health, and to protect the environment for future generation.
By : Sunil K Kumbhat , Jodhpur( Rajasthan ) India

Views expressed herein are personal views of the author and not that of COALspot.com.