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Reliance On Coal Hurts Climate Change Fight

Shi Jiangtao – SCMP | Updated on Oct 30, 2008

China’s reliance on coal for economic growth has made it difficult to curb growing greenhouse gas emissions, according to the central government’s first policy statement on climate change.

“Developing the economy and improving people’s lives are imperative tasks currently facing China,” the white paper, issued yesterday, says.

“However, its coal-dominated energy mix cannot be substantially changed in the near future, thus making the control of greenhouse gas emissions rather difficult.”

The paper highlighted the dilemma faced by China, with social ramifications if it curbed economic growth and the grave environmental consequences of fast development, such as frequent natural disasters, ecological degradation and shrinking harvests.

“Climate change has already brought real threats to China’s ecological system and economic and social development,” said Xie Zhenhua , deputy director of the National Development and Reform Commission.

The 44-page paper lists various adverse consequences of climate change on agriculture, river and sea pollution and social and economic sectors.

“Extreme phenomena, such as high temperatures, heavy precipitation and severe droughts, have increased in frequency and intensity,” it says.

If not alleviated, the consequences will reduce grain output, shrink lakes and wetlands, cause desertification of grasslands and livestock epidemics, and accelerate glacial retreat and sea-level rise.

However, it is unlikely that China will break its addiction to coal, the cheapest and most plentiful energy source in the country, any time soon. Coal still fuels about two-thirds of China’s energy needs.

The mainland has set ambitious targets to cut energy waste by 20 per cent and pollution by 10 per cent by 2010. Authorities have closed thousands of small coal mines and coal-fired power plants.

Last year, its use of renewable energy – including wind, solar and hydroelectric power – amounted to about 220 million tonnes of coal equivalent, which equals cutting 500 million tonnes of carbon dioxide emissions.

With the promotion of renewable energy, the proportion of coal in the energy mix has fallen by more than 2 per cent in the past three decades, the paper says.

True Cost Of Coal To Nation ‘Far Exceeds’ Market Price

Shi Jiangtao in Beijing – SCMP | Updated on Oct 28, 2008

The environmental and social costs of China’s reliance on coal as an energy source have been grossly underestimated, a joint study by environmentalists and economists says.

For each tonne of coal consumed last year, China paid 150 yuan (HK$170) extra in environmental damage, according to “The True Cost of Coal”.

The report, commissioned by Greenpeace, the US-based Energy Foundation and WWF, was written by prominent mainland economists.

The report estimated that the true cost of coal in China last year was about 1.75 trillion yuan, nearly 7.1 per cent of gross domestic product that year.

The figure would be even higher if the impact of climate change were included, according to the report.

“Environmental and social damages are underestimated for using coal in China, as a result of market failures and weakness in government regulations,” said Mao Yushi , lead author of the report and founder of the privately funded Unirule Institute of Economics. “China must count these external costs and make the coal price reflect its true costs.”

The so-called external costs were air and water pollution, ecological degradation, increasing health costs, mining accidents and infrastructure damage.

It also took into account the price distortion caused by government regulations, such as land-ownership policies and poor worker safety and compensation systems, which keep the cost of coal down. Coal accounts for 70 per cent of China’s primary energy consumption and is the biggest single source of air pollution across the country.

It causes 85 per cent of sulfur dioxide emissions, 67 per cent of nitrogen oxide emissions and 70 per cent of airborne particles. Mining has contaminated water, degraded land and caused massive land subsidence.

Coal is also responsible for China’s enormous carbon dioxide emissions, which are believed to have made the nation the world’s largest greenhouse gas emitter.

Quoting the report, Yang Fuqiang , chief representative of the mainland office of the Energy Foundation, urged Beijing to impose energy and environmental taxes.

His view was supported by Professor Mao, whose study showed that the introduction of a coal tax would raise prices by up to 23 per cent and reduce consumption by about 12 per cent.

“But the taxation measures would have little impact on China’s economic growth,” the report said. “On the contrary, it would make China more competitive globally in the long run and increase China’s social wealth by 942 billion yuan.

“The government of China has the opportunity to make a real improvement to the environment by reforming the current coal pricing system.

Yang Ailun , Greenpeace’s climate and energy campaign manager, said recognising the true cost of coal would create incentives to developing cleaner, sustainable energy.

Biofuels “Better” Than Standard Jet Fuel, Says Boeing

NewEnergyFocus – 27-10-08

Aviation experts have said it is now “unequivocally” certain that biofuels could be used to fuel aircraft – and that they could even deliver better performance than standard kerosene.

The government is expected tomorrow (October 28) to include aviation within its proposed tougher climate change emission curbs being added to the Climate Change Bill.

But while airlines would be able to buy surplus carbon emission allowances from other sectors to comply with their new requirements, it now appears that direct emission cuts from greener fuels could be possible.

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Virgin Atlantic flight VS811P preparing for take-off in February this year: the 747-400 aircraft flew from Heathrow to Amsterdam powered by jet fuel that included coconut oil and babassu nut oil

Boeing has revealed that new technology available in the last 12 months has now opened the door to biofuels in aircraft.

Speaking at a conference earlier this month, Boeing Commercial Airplanes’ director of environmental business analysis, Darrin Morgan, said its work with Virgin Atlantic is now spurring the biofuels supply chain to consider the possibilities of aviation demand.

As a result, he predicted that aircraft manufacturers would now get “very involved” in the search for aviation biofuels.

Commenting on the latest tests on biofuels in aircraft, Mr Morgan told the Westminster Energy, Environment and Transport Forum: “Not only do they perform as well, but with some data that you are going to see roll out in the next couple of months from various initiatives and efforts, they actually perform better, just from a technical perspective, in the aeroplanes.”

Boeing’s trial with Virgin Atlantic in February this year saw a 747-400 aircraft flying from London Heathrow to Amsterdam using a blend of babassu nut and coconut oils blended with kerosene jet fuel. The project saw Boeing working with GE Aviation and Imperium Renewables as well as Virgin Atlantic.

The aviation industry had already been working to maximise fuel efficiencies in jet engines, with the greening of the fuel supply itself the next step, with liquid hydrocarbons like biofuels seen as the only option. “We can’t do plug-in hybrids,” said Mr Morgan.

Aviation is only responsible for 5% of global transport fuel demand, according to the Boeing director, but Mr Morgan suggested that a 20% proportion of biofuels within the sector’s jet fuel could be possible – which would represent 1% of global transport fuels switching away from fossil fuels.

Higher proportions of biofuels would be possible, although there are doubts about whether any more biofuels would be available without impacting on oils needed for food supplies.

Standards

Mr Morgan said Boeing was keen to link up with global standards to ensure there were no unwanted impacts from biofuel use.

He said: “We do believe that supply chain can happen in the next three to five years, so bring in the non-governmental organisations and the other public organisations, they are smart about sustainability.”

Groups including Friends of the Earth have been lobbying for aviation to be included within UK climate change targets, although the campaigners do not support biofuel use.

Boeing is now inviting airlines to sign up to a “sustainability pledge” to help further the drive towards renewable fuels, and has already signed up airlines representing 15% of jet fuel demand.

The Moon May Solve Our Energy Problems

Celebrity vet Eric Lai shares his views on society through the eyes of animals. Give him your feedback at urbanjungle@scmp.com
Dr Eric Lai – SCMP | Updated on Oct 24, 2008

Like many young people, I was brought up with a healthy dose of information about space exploration to stimulate my imagination. I’m not exactly sure what is so enticing about the mysteries of space, but I suspect it is similar to what prehistoric man saw as he looked up at the myriad stars and planets.

We are essentially looking at the same sky and, when I find myself on holiday somewhere on a pristine beach away from the light pollution of Hong Kong, I am reminded of the immensity of the universe, with its unfathomable size that generates so much awe and humbles mankind. I may know a little more about the cosmos than our prehistoric ancestors, but probably not that much more in the context of the whole universe.

I remember seeing Halley’s Comet on its last visit in 1986 and, in the same year, Voyager 2’s flyby of Uranus. It was simply a stunning time to be alive, to witness such events as they happened.

During the 1990s space exploration really did slow down, as the countries of the world came back down to Earth to handle the more mundane problem of running the planet and its inhabitants.

But I have noticed in the past year that there seems to be something stirring in the sphere of space exploration, rather than just rhetoric. Several new countries are vying for space real estate left over by the US and the former Soviet Union. There was also the recent unmanned mission to the moon, Chang’e 1. It was the first phase of the Chinese lunar programme, which will hopefully end with ore samples from the moon and, one day, a base there. Then there was the launch of the Indian Chandrayaan 1 spacecraft this week. Like the Chang’e mission, it will send a robotic satellite that will orbit the moon and map the surface. Both hope to find subsurface water and a resource called helium-3.

Just hearing this news of space exploration on the radio and television in the past year has made the less imaginative and more practical part of me wonder why these countries are so belatedly sending missions to the moon when the Americans already did so with the Apollo 11 mission in 1969. I can’t imagine any government spending billions of dollars simply for national pride anymore. Like the western world, China has grown beyond the darker times of propaganda into an era of modern communications, where the truth can’t be muffled so easily. So why are China, India, the United States and even countries like Kenya showing renewed interest in the moon?

I found the answer when I heard the term “helium-3” mentioned, although I was surprised it was the reason. When I was doing physics, I learnt that helium-3 is a non-radioactive isotope of regular helium-4. The beauty of helium-3 in a fusion reactor is that the byproducts are less radioactive and, hence, produce less radioactive waste. Current fusion-type reactions indirectly create electricity by heating up water, but when using helium-3, water is not needed and electricity can be generated directly in a more efficient process.

I remember raising my hand in our physics lecture when I first learned about this process to ask the lecturer why we weren’t using it, because it sounded too good to be true. He said: “Helium-3 is rare on Earth and the total amount probably couldn’t generate enough electricity for Australia for two years.”

When I heard that there was helium-3 on the moon, I quickly did some research and some quick maths. There are about 15 tonnes of helium-3 found naturally on Earth, but there are an estimated 1 to 5 million tonnes under the moon’s surface, specifically in an ore called lunar regolith.

Official sources say China needs about 10 tonnes of helium-3 to power the country for a year. My quick calculations are based on China needing 15- 20 tonnes realistically, considering we are not likely to get 100 per cent efficiency. We’ll probably need 150 to 200 tonnes a year to power the entire planet. If it is true about the volume available on the moon, there should be enough there for at least 5,000 to 25,000 years.

No wonder there is a rush to get back on the moon. It is not going to happen overnight, of course. It is predicted a prototype fusion power plant using helium-3 won’t be in operation until 2050 at the earliest, and it will take time for lunar-mined helium-3 to be viable – but it may be worth the wait.

The whole story really gives me hope for mankind. It tells me that there are people in government that have a long-term vision for our planet’s future. It also instils hope that one day, living, working and exploring space will be viable options, when energy is plentiful and cheap. I hope I live long enough to see the return of Halley’s Comet and the mining of the moon.

Commission Launches £360m Hydrogen Fuel Programme

New Energy Focus – 17-10-08

The European Commission has launched a new public-private initiative offering extra support for research and development in hydrogen and fuel cell technology.

The six-year Fuel Cells and Hydrogen Joint Technology Initiative will receive the equivalent of £360 million funding, to be matched with private sector funds.

It will fund research into technologies the Commission said was often “so complex that no single company or public research institution can perform it alone”.

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Launching the initiative in Brussels this week, the Commission said hydrogen as a transport fuel had advantages over both biofuels and electricity

Launching the initiative in Brussels on Tuesday, the Commission claimed it would cut the time it will take for hydrogen and fuel cells technology to reach a wider market by up to five years. Regarding potential for these technologies to power vehicles, it added that the research could lead to mass-production by 2015 to 2020.

The EU Commissioner for Science and Research, Janez Potocnik, said: “By investing in such a results-oriented scientific project, we are putting our money where our mouth is: the development of new energy technologies is crucial if we are to meet EU objectives to address climate change and energy challenges.”

The industry group taking part in the initiative includes motor manufacturers Fiat, PSA and Volvo and oil firms Total and Shell. European universities will also be working within the initiative.
Investment

The Commission hopes to lead the development of hydrogen and fuel cell power ahead of global competitors like the US, Japan or China. As well as funding research, it said the Joint Initiative would help raise confidence levels among investors and help industry draw up long-term investment plans.

It said hydrogen power should be seen as an alternative to electric vehicles and biofuels, and that hydrogen had an advantage over electricity for powering vehicles because of it could be more easily stored.

A first call for proposals for an initial funding round of £22 million this month targets research in refuelling infrastructure, hydrogen production, storage and distribution and also stationary power generation and CHP projects.

The Chairman of the Governing Board of the Joint Undertaking, Gijs van Breda Vriesman, said: “The Fuel Cells and Hydrogen Joint Technology Initiative is the best possible vehicle to accelerate the development of technologies and bring the commercialisation of hydrogen and fuel cells forward. The JTI provides us with the unique opportunity to implement our plans on a large European scale.”

HK Aims To Raise Proportion Of Clean Fuels To 50% At Power Plants

Thomson Financial News – 15 October 2008

The government aims to increase the proportion of clean fuels in the power generation sector to 50 % of generated output to combat pollution, Hong Kong Chief Executive Donald Tsang said.

‘As electricity generation is a major source of pollution in Hong Kong, I pay special attention to ways of reducing coal-fired power generation and promoting the wider use of clean fuels while maintaining secure supplies of energy,’ he said.

He noted in his annual policy address that 28 % of electricity generated by power plants in Hong Kong comes from gas-fired facilities at present.

‘To improve air quality and address the challenges posed by global warming, we will actively explore ways to gradually increase the use of clean energy by, for example, increasing the proportion of natural gas for local electricity generation to 50 percent,’ he said.

Tsang did not provide a specific timeframe for achieving the objective.

Gains From Natural Gas Power Will Be Lost If Consumption Soars

Updated on Oct 03, 2008 – SCMP

I refer to the article by Secretary for the Environment Edward Yau Tang-wah (“A cleaner, cheaper energy future for Hong Kong“, September 23).

Replacing coal with natural gas for electricity generation is no doubt a great step towards controlling the sulfur dioxide (SO{-2}) emissions that are a significant source of damage to the air quality in Hong Kong. It is also good news for consumers in Hong Kong to hear that the excessive capital outlay and direct environmental impact will be minimised with the change of plan to build the liquefied natural gas terminal on the mainland instead of on the Soko Islands.

While this plan seems to echo our government’s commitment to tackle the air pollution problem, it has unfortunately also shown the administration’s political myopia.

Excessive SO{-2} emissions are a direct consequence of excess energy demand.

If the government does not seek to reduce energy use in tandem with switching to cleaner fuel, no sustainable change is going to happen.

In a way, the removal of the HK$10 billion capital outlay for the Soko Islands plant (hence the cost of power is likely to remain at the present level) almost encourages consumption.

It gives consumers a false sense that “it is okay to use power now because it is clean”.

Nevertheless, CLP Power and Hongkong Electric are for-profit organisations. They would be shooting themselves in the foot if they endorsed plans that reduced consumption.

Finally, another closely related problem is that nearly half of our air pollution comes from north of the border.

It is of no use if only Hong Kong regulates the use of coal for fuel and the desulfurisation requirements. The same standards must be applied in cities in the Pearl River Delta in order to achieve the intended results.

Pollution is a difficult problem. The lobbying will get ugly and some aspects of the economy will be compromised, but we must trust that the Hong Kong government is aware of what needs to be done and will endeavour to achieve what is best for us.

Michelle M. Lee, Mid-Levels

Power Struggle – Human and Environmental Cost For Chinese Booming Economy

Simon Parry – Updated on Sep 28, 2008 – SCMP

On average, 10 mainland coal miners die each day and while the government recognises the dangers posed by privately run mines, it needs to keep a booming economy supplied with fuel. Simon Parry reports on the human cost of doing so

The grubby, ramshackle clinic for injured miners is hidden away like a guilty secret at the end of a dirt track in a village near Datong, Shanxi province, China’s coal capital. Outside, Zhu Jiaching hobbles along on crutches and speaks through broken teeth about the day last September when luck was on his side.

“I was working underground when the scaffolding collapsed on me. My legs were broken and my teeth were smashed when I fell face down into the coal.” He points to his black and swollen upper lip. “I still have pieces of coal lodged in here.”

Zhu was carried unconscious out of the mine. He was one of the lucky ones. Last year, 4,000 mainland miners were killed in underground accidents. “A fortnight after my accident, there was another scaffolding collapse in the same stretch of mine,” the 39-year-old father of two says with a grimace. “Four miners were killed. All were from my home province.”

With no salary and only hospital meals to live off, Zhu is waiting to be well enough to return to his wife and children hundreds of miles away. “The mine manager came to see me a few weeks after my accident and offered me 10,000 yuan [HK$11,390] compensation if I took the money and went straight home,” he says.

“I refused. At the time I couldn’t even walk.

“The manager left and hasn’t been back. He won’t discuss the matter and I’ve been living in the hospital ever since. I want him to pay for the treatment to repair my broken teeth and give me proper compensation – then I’ll go home for good.”

In nearby Ganzhong village, Wan Mingyong, 35, smokes and chats with friends as he waits to begin his eight-hour underground shift. Luck was on his side too when, in another privately run coal mine in May last year, a wall of coal exploded in his face. Wan’s face and neck are still peppered with tiny lumps of coal.

“There was a roar and a bright flash and then I was blinded. Pieces of coal shot into my face like bullets and I was covered in blood. My first thought was `Am I blind?’ I spent a month in hospital but I was very lucky. I could have been killed,” he says.

“I was given 5,000 yuan compensation by the coal mine’s bosses. I wasn’t happy with it but what could I do? I had to look after my family so I got out of hospital as quickly as I could and went back to work at the coal face.”

Wan is well aware of how lucky his escape was. “My brother-in-law was crushed when scaffolding collapsed on him in the same mine in 2004. He should have lived but was left to die in hospital on the orders of the coal-mine owner so that he wouldn’t have to pay more compensation,” he says. “We believe they may have even given him a lethal injection.

“At that time, if a miner died, his employer had to pay the family 50,000 yuan compensation. If a worker was crippled, the amount would be three times as high because he had to be paid disability benefit. So it was much cheaper to make sure that my brother-in-law didn’t survive and that’s what they did.”

The stories of Zhu and Wan are typical. The men are part of an army of workers labouring in privately run mines in Shanxi and Inner Mongolia, in northern China, helping dig up the coal that accounts for nearly 70 per cent of the energy needs for the world’s fastest-growing economy.

China has overtaken the US as the world’s biggest producer of greenhouse gases, according to a University of California study released earlier this year, and 75 per cent of its carbon-dioxide emissions come from the coal-fired power stations that are being opened at a rate of almost one a week.

Greenpeace will this autumn release what is expected to be a highly critical report on China’s overdependence on coal, warning that it is heading towards an environmental disaster unless it increases the price of coal – heavily subsidised to support the booming economy – to restrict its use.

“The price of coal should reflect the full cost of using coal,” argues Beijing-based Greenpeace coal campaigner Liu Shuang. “These power stations are causing serious air pollution. They are not only causing problems for human health but they’re polluting the water and land as well.

“Action must be taken soon. The government did everything it could to stop pollutants during the Olympics but this is a problem that is visible in Chinese cities every day. The Chinese government is taking the coal issue seriously, but it has not done enough.”

It is an industry that exacts a devastating price not only in environmental terms but in human terms. China has 5 million miners and the annual death toll, mostly in smaller, privately run mines, accounts for 80 per cent of all mining deaths worldwide. An average of 10 miners die every day on the mainland. Last Sunday, 37 miners were killed in a gas explosion at a private mine near Dengfeng city, Henan province. The same day, at least 19 miners died after a fire in a coal mine in Hegang city, Heilongjiang province.

Alarmed at the accident rates, the mainland in 2006 announced a series of measures to improve safety, increasing inspections, improving compensation for injury or death and ordering thousands of smaller mines producing less than 90,000 tonnes of coal a year to close. The idea is to concentrate production in state-run mines, which employ tens of thousands of miners and where both safety standards and the quality of the coal are easier to control. The policy has had a degree of success, with death rates in the industry falling substantially from a peak of almost 7,000 in 2002 to 4,700 in 2006 and less than 4,000 last year.

But this year, in the brown and barren hills of northern China, where the country’s biggest coal reserves lie, the huge trucks that move between the privately run mines are once again rumbling back and forth as dozens of mines reopen.

“Since the beginning of this year, when coal shortages became acute, mines everywhere have started opening again,” a retired mining supervisor in Datong says. “The government knows what is happening but provided they allow inspectors to visit every now and again to check on safety standards, they are turning a blind eye to it.”

The reason is overwhelming demand. The mainland needs every last lump of coal to satisfy the demands of its industrial revolution, its booming urban electricity consumption and the additional strain on resources that the Olympic Games in Beijing has had. On top of that, China has just had its harshest, coldest winter in half a century, causing fuel shortages so severe President Hu Jintao travelled to Datong to personally appeal to its 200,000 government mine workers to dig harder to help their snowbound compatriots.

“The president’s visit made us very happy,” says Li Mingxin, 58, a retired miner working as watchman at the Datong’s Xin Zhaoyiu coal mine – known as Government Coal Mine No 5 – where more than 10,000 miners are employed. “We felt very proud. The president of our country had come and asked us for more coal to help save the country, so we all made a special effort.

“Everyone gave up their Lunar New Year holidays. We increased production dramatically and all the coal went to the south for electricity production. We were very happy to be called upon to help at the time of our country’s great need.”

Sitting beneath a portrait of Chairman Mao in his watchman’s hut, Li – who spent 41 years working as a miner – frowns as he speaks of the dangers facing workers at the smaller, privately run mines. “Here, we have very few accidents because the attention to safety these days is much greater than in the past.”

“But the private mines are so small and they use mules and oxen to pull the coal carts from underground. There is also the risk of gas explosions because management is poor, ventilation isn’t good and the machinery to test the density of the gas is not good enough,” he says.

In Datong, the vast majority of workers in the 18 government-run mines are locals and in many cases, jobs are passed on from generation to generation, with the sons of miners being given priority for jobs.

Salaries are about 3,000 yuan a month, much higher than the national average, with a pension of 2,100 yuan for retired, long-serving miners such as Li. “Many men of my age have no salary at all while I receive a 2,100 yuan pension and another 500 yuan a month for working as a watchman,” he says. “We are paid like civil servants but we deserve it because of the duty we did for our country.”

Private mines – usually owned by county or village governments but leased to private companies – are staffed by migrant workers from poor provinces who move from mine to mine to find better salaries and conditions. They can earn up to twice the monthly salaries of their counterparts in state-run mines, taking home up to 6,000 yuan, but the high salaries come at a terrible price: accidents in privately run coal mines account for about 70 per cent of China’s mining deaths.

One miner who works as an explosives specialist in a private mine outside Datong rues the day he turned down the chance to work in a state-run mine because he wanted to maintain a higher salary.

“I didn’t realise at the time that if you work in a government mine for 10 years, you get a pension for the rest of your life,” says Yang Hua, 39.

“As migrant workers in privately run mines, we take greater risks and move from mine to mine. I will have to carry on working until I am 60 to support my family. It’s very different for the mine owners. They drive luxury cars and can make 10 million yuan in just one month. Because of the coal shortage, they have never been able to make so much money.”

Stung by the government criticism of their safely standards, private mines now operate amid tight security, behind high walls and fences, with teams of security guards patrolling the premises to keep unwanted observers away. “No one is allowed in without the owner’s written permission,” a security guard at one private mine says.

In the present sensitive climate, even government-run mines are reluctant to let outsiders visit. Even though guided underground tours are advertised on fading billboards outside the showpiece Government Mine No 9, an official at the visitor’s office eyes us suspiciously and says: “Sorry. We can’t take you in. Our visitor insurance has expired.”

When we assure him that our own insurance will cover the visit, he flicks distractedly through a pile of papers before looking up and announcing: “The tour is very time-consuming and expensive and there are only the two of you. I’m afraid we can’t afford to take you inside.”

Reflecting on the accident that crippled him just three months after he began work at a privately run mine outside Datong, Zhu says: “It happened because of neglect. The managers knew there were cracks in the scaffolding but they still made us carry on working beneath it.”

As a relatively new employee, Zhu was earning only 100 yuan a day to work underground, laying explosives to blast into virgin coal faces, and would work 26 or 27 days a month to earn money to send home to his family in western Sichuan province.

“I used to be a farmer but I have a daughter aged 17 and a son aged 14 and I couldn’t earn enough to pay for them to go to school, so I decided to come to the coal mine to work,” he said.

“Now my family is in an even worse situation because of what has happened to me. My wife has had to borrow money to pay for the education of our two children and we also have my parents to support. It is very hard for them. I will go back to farming when I recover – I can never go back to working in a mine.”

His wait for a fair payout could be a long one if the experience of other injured miners is anything to go by. “I’ve been in this clinic for five years since I broke my legs in an accident and I still haven’t received a proper settlement,” says He Yao, 65, from Inner Mongolia. “I’ll never work again now and I have three children to support – so I’m not going home to my family until I’ve got the compensation I deserve.”

For Wan, the trauma of his accident last year and his relative’s death in 2004 have left deep and permanent scars. “My brother-in-law was only 30 when he died and he had a seven year-old son. The family hired a lawyer and proved in the court case that he should have survived. In the end, they got compensation of 180,000 yuan for his death – more than three times what they were originally offered,” he says.

“We have higher safety standards too. The Olympic Games made inspectors stricter and they are doing more to guarantee the safety of workers. If they check a mine and it isn’t safe, they close it down. The government policy is good because the government is more concerned about the situation of mine workers.”

However, despite the new level of official concern, coal mining in China is like a game of Russian roulette. “I do this work because the salary is better than working in a factory but I risk my life earning the extra money,” says Wan, speaking at the end of his shift in the communal miners’ home outside Datong where he lives with his wife and 12-year-old son.

“Every day when I go to work, my family worries about me, especially after the accident last May. It is only when I come back home at night that they can relax, knowing that another day’s work is behind me and that I am safe from harm.

“I keep doing this because I need to pay for my son’s education. I became a miner because I didn’t have a choice. I want my son to go to university and find a good job. I don’t want him to suffer the same hardships as me.”

Red Door News

A Cleaner, Cheaper Energy Future For Hong Kong

Edward Yau – SCMP – Updated on Sep 23, 2008

Building on our long history of energy co-operation with the mainland, the memorandum of understanding (MOU) signed between the National Energy Administration (NEA) and the Hong Kong government last month provides a firm backing for an agreement that will help ease the pressure for tariff increases.

The agreement will underpin our city’s economic development in the next 20 years, and ensure that our energy comes from clean sources that are close to home, an arrangement that will keep electricity prices at a relatively low level.

Under the MOU, Hong Kong will see a net increase of at least 1 billion cubic metres of natural gas supply for clean power generation. By sealing the document with Hong Kong, the NEA – which is responsible for regulation and oversight of oil supply and distribution – has undertaken, first, to support the China Guangdong Nuclear Power Holding Co Ltd to renew its supply agreement with Hong Kong for a further 20 years at the current level.

Second, the central government also supports supplying natural gas to Hong Kong, including China National Offshore Oil Corporation’s renewal of its supply agreement with us for another 20 years, also at the current level.

In addition to renewing the two existing sources of supply, it has been agreed in principle to study the feasibility of supplying natural gas to Hong Kong via a new conduit, the Second West-East Natural Gas Pipeline, with an estimated annual supply of more than 1 billion cubic metres.

In a related commitment, the NEA also agreed in principle that Hong Kong and mainland companies could jointly build a liquefied natural gas terminal on the mainland for supplying natural gas to Hong Kong. As the proposed LNG terminal on the mainland can also receive LNG from worldwide sources, Hong Kong will enjoy a greater flexibility in gas sources.

The MOU not only replenishes the current gas supply to CLP Power, it also opens up new sources through alternative pipelines. Importantly, the MOU provides new opportunities for collaboration between energy enterprises on both sides, and is by no means a supply contract binding any firms. It opens the door for energy enterprises on both sides to pursue opportunities on a commercial basis in line with market principles.

For the 2 million CLP Power customers, a more practical concern is whether the agreement helps reduce their power bills. Before the agreement, CLP Power proposed to build an LNG terminal in Hong Kong in anticipation of the Yacheng gas supply running out. Recognising the need for more natural gas to replenish the current gas supply from Yacheng, the government has adopted a dual track approach to process the application.

While proceeding with the initial statutory planning and land processes, it has conducted a due-diligence exercise to verify the need for an LNG terminal on the environmentally sensitive South Soko Island. With an estimated cost of HK$10 billion, the project would inevitably boost CLP Power’s net fixed assets, thus entailing a return to be borne by its customers in electricity tariffs.

As a result of the MOU, CLP Power decided on September 12 to abandon its LNG terminal plan. The imminent result of this decision is the removal of an initial capital outlay of HK$10 billion and the need for cost recovery from the tariff. The building of new pipelines to transfer the gas under the MOU will incur additional capital investment, but the amount will be less than the LNG terminal proposal.

Electricity generation is a major source of pollution in Hong Kong. Natural gas is one the cleaner and more efficient forms of fossil fuel. Replacing coal with natural gas in power generation will help improve air quality.

On top of its environmental benefits, the use of natural gas will also diversify the fuel mix in power generation, thereby improving the reliability of the electricity supply.

Edward Yau Tang-wah is secretary for the environment

Details For Supply Of Gas

Details for supply of gas will be worked out on commercial principles

Sep 21, 2008 – SCMP

I refer to the report (“Experts express concern over gas deal”, September 14).

It is unfair to suggest that the government has agreed to any terms with regard to mainland gas companies that are not made public to the people of Hong Kong. The memorandum of understanding on energy co-operation, concluded between the Hong Kong government and the National Energy Administration on August 28, is a public document. It provides a guarantee on the continuous supply of clean energy including natural gas to Hong Kong in the coming two decades. Under the memorandum, the central government provides assurances on the supply of natural gas from three sources – offshore gas, piped gas and a liquefied natural gas (LNG) terminal to be built jointly on the mainland. The future level of gas supply to Hong Kong will be over and above the current level.

We have stressed from the outset that the purpose of the memorandum for the enhanced collaboration among enterprises is one of facilitation. As stated clearly in the memorandum, the detailed arrangements for supplying natural gas to Hong Kong, including pricing, should be worked out on commercial principles between the relevant enterprises on both sides. It is up to the enterprises concerned, and not the government, to negotiate the prices of the gas supply under the memorandum. For Hong Kong the private sector is best placed to meet our energy requirements in response to market demands.

For more than a decade, local power companies have been sourcing supply of natural gas from the mainland based on commercial principles. Future collaboration between energy enterprises across the border will continue to adhere to these principles.

With such solid backing and assured multiple sources of gas supply, it begs the question why Hong Kong consumers should be asked to pay for an LNG terminal at Soko. We welcome the decision of CLP Power (SEHK: 0002) Hong Kong Ltd to abandon its plan to build an LNG terminal in Hong Kong.

The government stands ready to provide every assistance towards realising the goals in the memorandum of understanding.

Katharine Choi, for secretary for the environment