London, UK — A worldwide rush to use “cheap” and dirty coal to supply power is threatening to impose huge costs to the environment and the global economy.

In a new briefing paper recently released to coincide with the Intergovernmental Panel on Climate Change’s (IPCC) meeting about the economic impacts of climate change, WWF shows that the short-term economics which are driving the use of coal to generate cheap power have created a “fool’s paradise” that will lead to profound long-term problems.

The report — Are the costs of using coal higher than the cost of cleaning it up? — outlines the fact that in the last four years, coal use around the world grew by 22% (BP, 2006) – a major factor behind the record 3% per year rise in global CO2 emissions (International Energy Agency (IEA), 2006).

According to the IEA, CO₂ emissions from energy sources may grow by up to 90% by 2030 unless governments act rapidly (World Energy Outlook 2006, BAU scenario).

This potential increase in global coal use is driven by its increasing use in China, India and Russia for power stations, as well as a fresh rush for coal in countries like the United States and European Union nations resulting from higher natural gas prices and power plant replacements.

“Coal is an extremely dirty source of power, and imposes huge costs on people’s health, the environment and the economy," said Keith Allott, head of WWF-UK’s climate change programme.

"Unless governments agree to clean up coal and promote clean alternatives, coal will remain the fuel of choice, particularly in the emerging economies of Asia-Pacific. It is not helpful to simply blame these countries for their use of coal. Governments and industry should recognize that there are high costs in the use of traditional coal use and instead invest in the deployment of pollution reduction technologies.”

Reports on the impacts of climate change on China predict a 37% decline in wheat, rice and corn yields in the second half of the century. Rainfall may decline as much as 30% in three of China's seven major river basins. A rise in sea level of 1m will submerge an area the size of Portugal along China's eastern seaboard — home to more than half the country's population and 60 percent of its economic output.

India has already seen a surge in heat waves over the past century and a rising death toll due to heat stress in more recent years. Serious floods in its north-eastern states in July 2005 killed over a 1,000 people and economic losses amounted to more than US$250 million.

The cost of electricity from coal is expected to double by 2030 to US$40–55 (per mega-watt hour, MWh). The additional cost of using carbon capture and storage for coal may raise the price to US$60–90 per MWh (IEA 2005, 2006 / IPCC 2005).

Even if there was no price on carbon, clean renewable technologies like wind, geothermal power and solid biomass will be cost-competitive with conventional coal by 2030. If however, the true cost of coal was factored in to its price, these sustainable low-carbon technologies would be even cheaper than coal today.

The WWF briefing paper sets out a series of steps that need to be taken to reduce the global coal dependency and move toward a future where energy supply is both reasonably priced, sustainable and is not contributing to climate change.

“We can solve the climate change problem, but it needs concerted international efforts right now," Allott added.”