Who Killed Coal in the United Kingdom?
October 28, 2019
The decline in coal-fired power generation in the United Kingdom has been rapid and astonishing. In six years, from 2012 to 2018, coal-fired generation fell by 88 percent. The United Kingdom now routinely experiences extended periods where coal contributes no electricity at all to the national grid, while coal-fired power plants are being dismantled. How exactly did the United Kingdom accomplish this feat? Who killed coal?
The short answer is gas. But the long, and more accurate, answer is efficiency and renewables. In a narrow sense, declines in coal have been accompanied by spikes in gas generation. From 2006 to 2010, for instance, the 39 terawatt hours (TWh) decline in coal-fired generation was almost fully offset by a 35 TWh increase in gas output. Then coal went up again, from 2010 to 2012, and gas fell. When the UK government firmed up a floor on carbon prices in April 2015, it was a sharp increase in gas that delivered a fatal blow to coal.
But in a grander sense, gas may have delivered a decisive strike to coal, but it has not been gas that rose to replace coal. Gas has ramped up and down, and these fluctuations have affected coal output, but structurally, relative to 2000, gas-fired generation is actually down 11 percent and down 25 percent relative to the high point for gas in power in 2008. In reality, the dramatic decline of coal can only be fully explained by also looking to the role of energy efficiency and renewables not just gas.
The energy efficiency story in the United Kingdom is a massive success: energy consumption reached a 50+ year low in 2018, and the country consumes less energy today than it did in 1965—courtesy of both structural change as well as aggressive efficiency measures. These gains have translated into a reduced need for electricity, whose supply fell by 10 percent relative to 2000 (and 14 percent versus 2005, the high point). In TWh terms, the reduced need for electricity is 39 percent of the overall decline in coal-fired generation.
The other driver has been renewable energy: mostly wind but also bioenergy (and a sliver of solar). Wind shows up in the balances in 2007; in 2018, it contributed almost 48 TWh, of which 26.5 TWh came from offshore installations. Bioenergy is another contributor, with an increase of almost 25 TWh from 2000 to 2018. Combined with energy efficiency, wind, solar, and bioenergy have allowed coal to reach nearly zero without any increase in gas-fired generation, a lesson, perhaps, that gas can help deliver on decarbonization over a short horizon but without necessarily a guaranteed market share as renewables ramp up.