Construction of coal plants in Southeast Asia plummets

Construction of coal plants in Southeast Asia has stalled considerably, with only Indonesia (pictured) breaking ground on new stations in the first half of 2019, according to a Global Energy Monitor (GEM) report released yesterday called “More Fizz Than Boom: 2019 Sees Coal Plant Growth in Southeast Asia Dwindling as Pipeline Continues to Shrink.”

Global Energy Monitor, in its own words, “develops and shares information on fossil fuel projects in support of the worldwide movement for clean energy.” It’s an NGO funded by climate change advocacy groups.

Despite the perception of Southeast Asia as a growth area for coal, the regional coal pipeline has declined sharply. In 2016, it was at 12,920 MW. It was 6,355 MW in 2017. Only 2,744 MW entered construction in 2018, and in the first half of 2019, 1,500 MW entered construction.

Further, writes GEM:

Beyond construction, the amount of coal plant capacity in pre-construction stages in Southeast Asia also continues to contract, shrinking 52% from 110,367 MW in mid-2015 to 53,510 MW in mid-2019. With so few projects moving from pre-construction to construction, a continuation of recent trends will mean that most of the remaining 53,510 MW in pre-construction development is more likely to be cancelled rather than implemented.

Why the drop?

So, why the about-turn? Ted Nace, executive director of Global Energy Monitor, said:

To go into construction you have to get someone to commit hundreds of millions of dollars. In Southeast Asia, it looks like it’s becoming a difficult case to convince people to commit that kind of money.

The number of plants entering construction during the first six months of 2019 is extremely low, and we see this decline continuing.

Traditional coal importing markets such as Thailand and Taiwan have already made a clear pivot away from coal. While we will no doubt see some new coal plants coming online in countries such as Vietnam and Indonesia, the conclusion is rapidly being drawn that renewable energy is a smarter option to drive their economies.

Southeast Asia is home to three of the world’s top 10 largest coal power pipelines. Yet the low rate of new construction and quickly declining pipeline suggests much of this capacity will not be realized.

Photo credit: Dominik Vanyi/Unsplash