Asian nations push for 'dirty fuels' to ease energy crisis amid West Asia war

Several Asian nations are increasing the use of coal in order to cover the energy crunch triggered by the US-Israel war on Iran. The development has triggered warnings from climate experts indicating that coal as dirtiest fossil fuel, which has a devastating environmental impact. They also indicated a wake-up call for governments to invest in renewables, which can offer a more stable supply and are less exposed to price hikes.

From Bangladesh to South Korea, governments are attempting to offset declining energy imports, much of which traditionally comes from the Middle East. South Korea has postponed the closure of coal-fired power plants and lifted limits on coal-based power generation, while Thailand has increased output at the country’s largest coal-fired plant. Similarly, the Philippines, after declaring a “national energy emergency”, also plans to increase operations of its coal-fired power plants.

In South Asia, India, where coal accounts for nearly 75 per cent of electricity generation, has directed plants to operate at full capacity, while Bangladesh has boosted both coal usage and imports. Countries are scrambling to address shortages, especially of liquefied natural gas (LNG), widely seen as a transition fuel. However, supply disruptions caused by the Strait of Hormuz closure and strikes on Qatar’s LNG facilities have worsened the crisis. Experts also indicated that a major LNG export facility in Qatar is set to exacerbate the shortage and will have a years-long impact on the industry.

Removal of 30 billion cubic meters of LNG

Henning Gloystein, managing director of energy and resources at Eurasia Group, stated that nearly 30 billion cubic meters of LNG have been discarded from global supply chains, of which over 80 per cent is missing in the Indo-Pacific region. He added that the remaining cargoes that crossed the strait before the conflict spiralled will arrive in the next week.

“The global market has flipped within four weeks from quite a healthy supply surplus … into a very severe deficit – and that’s going to not just lead to price spikes, but real fuel shortages.” “Those countries that have coal reserves will be [using] that because it’s the fastest, cheapest way to replace LNG,” he said, adding that countries such as India are also increasing their use of renewable energy.

Delhi has fast-tracked approvals for setting up wind power projects and battery energy storage systems. Pauline Heinrichs, a climate and energy expert at King’s College London, said the crisis could serve as a critical turning point for governments. “The impact of coal on climate and health outcomes is devastating and disastrous – and we’ve proven that this is the case for many decades. Not only does it worsen climate risks, of course, but the same goes for pollution and for toxicity,” she said.