Who said the coal era’s closing?

Who said the coal era’s closing?

The North East’s role in energy provision is becoming ever more important as the war is cranked up on fossil fuels.

Experiments at Wilton under aegis of the Centre for Process Innovation could lead to a £3m industry converting energy from seaweed, and also at Wilton a £250m investment by Merseyside Energy Recovery is bringing about a waste to energy operation.

A new £650m power station situated between Middlesbrough and Redcar, MGT Power’s Teesside Renewable Energy plant, will convert biomass to supply 600,000 homes, via the National Grid from 2019. A Port Clarence renewable energy plant from 2018 will generate electricity for thousands of homes by wood burning. The Government, having cut support for renewables, is insisting gas fired power stations will be necessary over the next decade.

While the 320 acre site of the former Rio Tinto aluminium smelter at Lynemouth in Northumberland was bought with intention to redevelop by Harworth Estates, the former estates business of UK Coal, the Lynemouth power station that served the smelter was sold separately to RWE npower.

With the closure of the UK’s last deep mine in Yorkshire recently and closure of all coal-fired power stations perhaps by 2023, coal is witheringly discredited and Britain’s production now relies on 16 drift mines, with North East firms Hargreaves Services and Banks the main businesses involved.

Banks runs or manages nine of the surface mines but meanwhile has diversified into renewable energy, housebuilding and other activities. Hargreaves, in face of lower coal prices and less demand from power stations, is having to remodel.

Cheaper foreign coal and government policies such as carbon tax are accelerating the present coal industry’s decline. But coal still has influential champions who maintain that new technology, including carbon capture and storage, could slash CO2 and other harmful emissions.

Carbon capture as a profitable industry for the North East has been mooted for at least a decade and a half. It was a mainstay of future energy delivery advocated by the regional development agency One NorthEast, which pinpointed ready supply available as a byproduct of Teesside’s chemical industry.

Confirmation of the possibility came in a study by Edinburgh University that concluded carbon storage from industries such as Teesside’s pharmaceutical sector, in subsea spaces left by North Sea oil gathering, could also initiate new exploration in the area.

A Teesside Collective of companies has been canvassing for funding to build Europe’s first carbon capture and storage network, hopeful of making Teesside the clean air capital of Europe with 15m tonnes of CO2 a year stored there and 2,600 jobs created over the next two decades.

Belief is growing that the UK won’t be able to give up fossil fuels entirely. Professor Ian Fells, emeritus professor of energy at Newcastle University – and a champion of nuclear energy - says it’s unrealistic to see a change from fossil fuels as the debase option soon. By this midsummer a company called Five-Quarter expects to start work on its £30m underground coal gasification demonstration plant.

The company was formed when academics from Newcastle University secured licences from the UK Coal Authority to gasify undersea coal reserves. A revival in the use of coal, albeit as a catalyst, would come without the scale of danger to human life that was experienced over centuries when coal was a staple of the North East economy.

And despite a difficult period the offshore industry has entered, Cramlington based Techflow Marine, which produce products associated with fluid transfer systems, has been named fastest growing business and fastest growing large business in the North East in Ward Hadaway’s 2015 awards.  With every cloud, then, a silver lining…

To read more insights and views on the year ahead, take a look at the recently published BQ Yearbook.