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Energy security through coal – indigenous fuel provides security against supply risks

Herne – States, national economies and people all need energy to survive. Power is in the hands of those who control the sources of this energy and as far as the major fuels are concerned power is currently in the hands of an increasingly small group. Witness the fact that 70% of the world’s known oil reserves and 40% of the known gas reserves are located in one of the world’s most politically unstable regions – the so-called ‘energy ellipse’ that stretches from the Persian Gulf to the Caspian Sea.

Energy security through coal

This concentration of power in the Arabian Peninsula, Iraq, Iran and a number of former Soviet Republics conceals significant physical, economic and social risks. As the world’s second-largest energy market the European Union (EU) has long been a net importer of oil and gas and not only Germany but the rest of the Community too now sources more than 60% of its energy needs from overseas.

This creates a reliance, as we have seen with the Middle East crisis and Iraq war, that can have a recurring impact on the financial markets and share prices. But with coal the EU has its own long-term supply option. Coal accounts for almost 90% of the fossil-based energy resources of the current Community. Germany has workable coal reserves of about 35 bn tcs (tonnes coal equivalent) that will last a further 400 years at current rates of production. Compare this with the global reserves of oil and gas that at present production rates will be used up within 60 and 40 years respectively.

In a recent memorandum the EU Directorate-General for Transport and Energy called for greater use of indigenous coal reserves as a way to limit the growing dependence on imports and reduce the associated supply risks.

 

Source:
Deutsche Steinkohle AG.
Communications Department