India has long depended on coal-fired power plants to meet most of its energy requirements. While there always exists a debate on the merits and demerits of investing in them against other technologies, coal power plants are certainly facing an uphill task. A new report launched by Carbon Tracker shows that 40 per cent of the world’s coal power stations, including in India, were already running at a loss, challenging the need for new coal generation.
The report also argues that there is economic merit in closing down power plants in line with the 2015 Paris Climate Change Agreement. The study covers 6,685 coal units which represent 95 per cent (1,900 GW) of global operating capacity and 90 per cent (220 GW) of capacity under construction, and looks at current and forward-looking estimates of the (short and long-run) operating cost, gross profitability, relative competitiveness, phase-out year and stranded asset risk in a below 2°C scenario.