Analysis: Dutch coal generation plunges this summer as gas doubles on year

October 2, 2019, 6:47 pm | Admin

London — Dutch coal-fired generation fell to negligible levels over the summer as gas-fired output doubles on year, data analyzed by S&P Global Platts showed Wednesday.

Coal plant output averaged 0.5 GW in September, with gas generation at 3.6 GW.

"Coal-fired generation has tested fresh lows in September in the Netherlands. We forecast coal generation to recover from the lows last month but expect coal-to-gas fuel switching to persist in October, which will continue to squeeze out coal generation against previous years," S&P Global Platts Analytics' Sabrina Kernbichler said.

In addition to poor generation margins, units at Maasvlakte and Eemshaven have undergone extended outages the summer.

Uniper's 1.1 GW Maasvlakte MPP 3 plant is set to return Tuesday following turbine repairs, the operator said.

RWE's Eemshaven B unit has now been converted to co-fire biomass while RWE's Amer plant began co-firing earlier this year, it said.

The company secured some Eur2.6 billion in subsidies, with an estimated use of some 2.5 million mt/year of biomass, further reducing coal burn, it said.

Dutch coal capacity is set to fall by 630 MW by end-2019 with closure of Vattenfall's Hemweg 8 plant, leaving four units online, with around 4 GW.

Amer 9 is set to close in 2024, with the remaining three high-efficiency units to close 2030 under a government-mandated coal exit.

COAL STOCKS PILE UP IN DUTCH PORTS

Meanwhile, coal stocks in the Dutch ports of Amsterdam, Rotterdam and Vlissingen hit a record 7 million mt by end-September.

Coal prices have fallen over 30% versus 2018, even including a modest recovery in September, while CO2 prices were up18% on year.

Little wonder, then, that RWE plans to re-commission its 1.1 GW Claus C CCGT gas plant, with first tests to start this month ahead of full market availability scheduled for December 2020.

The plant has been mothballed since 2014.

Coal's demise is doing little to ease the government's climate target headache.

Under the Urgenda court ruling, the Dutch state is legally obliged to cut CO2 emissions by 25% over 1990 levels by 2020.

Economy-wide CO2 emissions rebounded in Q2 amid colder than normal weather following a Q1 decline with the Dutch economy facing slower growth in the second half of 2019 and into 2020.

The Netherlands emitted 189 million mt of CO2-equivalent in 2018 with coal accounting for 21 million mt of that.

Dutch emissions should not exceed 166 billion CO2 equivalent in 2020 to meet the 25% target.

Dutch renewables are also set to rise modestly from a 15% share in the 2018 power mix after the government boosted RES subsidies over recent years.

https://www.spglobal.com/platts/en/market-insights/latest-news/electric-power/100219-analysis-dutch-coal-generation-plunges-this-summer-as-gas-doubles-on-year

Last modified on October 3, 2019, 6:49 pm | 2865