Coal and Hydro Dilemmas

Coal is plentiful in Africa and South Asia and most low income countries assert their right to exploit fossil-fuels for the urgent task of extending their national grids. Observing that average household emissions are tiny fractions of those in Europe and North America, these countries perceive an element of hypocrisy in the maintenance of significant coal-fired generation in developed economies such as Germany and Australia.

For example, Zimbabwe plans to increase coal production by a factor of five, largely to fuel power generation, despite its plentiful renewable resources. Many environmental campaigners oppose this model of development, arguing that failure to control climate change will aggravate global poverty, ultimately reversing the benefits of expanded energy access.

Projections by global energy policy and research groups generally assume that coal will continue to feature prominently in the energy mix for developing countries, despite encouragement to “leapfrog” the old technologies in favour of renewables.

This conclusion is borne out in national plans published as a commitment under the 2015 Paris Climate Agreement. The poorest countries are expected to improve on “business as usual” in power generation, but without jeopardising economic development, for which energy capacity is crucial. For example, India’s rapid progress in creating new solar capacity cannot conceal its continued dependence on coal for more than half the country’s electricity.

The global coal industry itself lays claim to a moral responsibility to pursue global poverty reduction by achieving energy goals more quickly and at lower cost than renewable alternatives. Households desire connection to a traditional grid, runs this argument, observing that small-scale solar systems cannot play more than an interim role in an industrialising economy.

Sensitive to accusations of overlooking the needs of the poor in urban and peri-urban areas, climate campaigners focus their opposition on the availability of soft loans for fossil fuel projects from the multilateral development banks or indeed loans from commercial banks. Such lobbying is increasingly successful but is substantially undermined by China’s state-owned banks who have no qualms about stepping in, as is the case for Zimbabwe’s plans.

A second area of controversy centres on the interest of many developing countries in large hydropower projects, influenced by studies which declare the untapped potential to be as much as 92% and 80% in Africa and Asia respectively. As a renewable source, hydropower is a highly attractive option.

However, these projects have a poor track record of underperformance, environmental destruction and human displacement, often without proper prior assessment or consultation. Plans for major dams in Myanmar and Laos attract fierce opposition from international environmental and human rights watchdogs.

Both hydropower and coal-fired electricity are vulnerable to climate change. A fall in the level of dam water below the point necessary to drive turbines has already caused chronic power shortages during periods of drought in Mozambique, Uganda, Zambia and Ghana. Governments grappling with water scarcity are prone to overlook that power stations consume vast quantities of water for cooling.

The energy roadmap for the world’s poorest countries is therefore hemmed in by conflicting forces – the desperate need for human and economic development in parallel with the protection of vital environmental assets – both perspectives recognised in the Sustainable Development Goals. These countries face dilemmas that did not exist at the comparable period of development in Europe and North America, more than a hundred years ago.


more Energy For All briefings (updated April 2021)
Energy Poverty
Sustainable Development Goal for Energy
Solutions to Energy Poverty
Finance for Energy For All
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