Even if it ended tomorrow, it would take months to restore power to the energy market. While they remain closed, prices for oil, natural gas and a host of commodities will rise as a parallel economic war rages, where entire countries and companies are jockeying for spot markets, futures, freight, supplies and premiums.
It is therefore not surprising that some governments are turning again to coal as a – if only temporarily – safe haven for their energy needs, despite warnings about the environmental impact.
Energy shift in Asia
This shift is most evident in Asia, where 80% of the oil and natural gas passing through the Strait of Hormuz before the war ended up. In India, where coal meets nearly 70% of energy needs, the government has ordered plants to run non-stop to cover shortfalls in natural gas and oil. In South Korea the government has decided to extend the life of coal-burning thermal power plants and lifted restrictions on their participation in the energy mix. Similar measures have been taken in the Philippines, Bangladesh and Thailand.
Why China is enduring the energy crisis
Energy market analysts point out that for now China is holding out as it relies more on a mix of coal, nuclear power and renewables than on oil and natural gas. Its strategic oil reserves are estimated to last four months and it can count on support from Russia.
Europe is in a difficult position
Europe is gradually finding itself in a difficult position which, within a month of the war in the Gulf, saw the total cost of fossil fuel imports increase by 14 billion euros, according to the Commission, which reports that there have been no fuel shortages, but advises everyone to save money and prepare for difficult days. In this adverse climate, programs to wean off polluting coal take a back seat.
Berlin is considering restarting coal-burning thermal power plants
We may need to keep coal-fired power plants around for longer, Chancellor Mertz said last week. Coal combustion contributed 22% to meeting the country’s energy needs in 2024 compared to 60% from renewable sources. The German plan calls for zero coal burning by 2038. But, according to a Politico report, the Berlin government is considering restarting coal-burning thermal power plants. Those stations that are now closed could be brought back into the grid in order to reduce energy costs as gas prices have skyrocketed.
The Mertz Statement
“I’m not going to risk the core of our energy security because we agreed some deadlines years ago,” Mertz said, revealing the coalition government’s intentions under pressure from industry to put more coal in the energy mix while easing the burden on ordinary consumers. However, the chancellor ruled out a return to nuclear energy in the immediate future, while calling the further development of renewable energy sources necessary.
Italy returned to coal
Along the same lines, the Italian government yesterday passed a bill in the Lower House which extends by 13 years, until 2038, the operation of thermal power plants with coal. All four of the country’s factories should have been shut down by the end of 2025 under Rome’s climate commitments. But the Meloni government is keeping them in reserve to deal with an energy crisis if the war in the Gulf continues. The bill must also be approved by the Senate.
However, the coalition government’s partners, especially the League, have been opponents of measures to protect the environment, as have all the far-right parties in Europe that question climate change in the same line as the Trump administration. Meanwhile, given the reduction-stopping of imports from Russia, Europe’s dependence on American oil and natural gas is constantly growing.
