The number of reports of electricity shortages in China, India, and other developing economies recently, some of which I have posted, seem to be increasing.  Part of the problem in China may be due to environmental sensitivity surrounding the Olympics.  But it may also reflect a real shortage of coal globally and also the fact that electricity is becoming  uneconomical to produce given price controls on electricity combined with rising coal prices.   The last sentence of the report below from The Times  on an “electricity crisis …

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A report in the Globe and Mail recently described how one of the environmental “problems” often cited by critics of oil sands has become a useful export for Suncor (SU), one of the largest oil sands producers.  The byproduct is coke, which has been stacked  like new mountains for some eventual low-value use like landfill.   Now it is being exported to China for real money.  

Let’s hope the Chinese can figure out a way to burn it while controlling the carbon dioxide emissions.  (Fat chance, I suppose.)  Well, at least this …

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  China’s Power Crisis Deepens as Coal Supply Dwindles (Update1) By Wang Ying July 29 (Bloomberg) — China, the world’s second-biggest energy consumer, is facing a deepening summer power crisis that may persist into the winter months, the nation’s dominant electricity distributor said. State Grid Corp. of China, which more than 1 billion people rely on for power, said electricity shortages have worsened because of inadequate coal supplies. Forty-six percent of the power stations connected to the distributor’s grid have coal stockpiles below the “caution line,” or …

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You’ve read about coal shortfalls in China and South Africa.  India is the latest country to indicate it has to import more coal.  Here is the complete report from Bloomberg.   All of this may bode well for the dry bulk shippers.

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By ELAINE KURTENBACH 01.25.08, 8:30 AM ET SHANGHAI, China - China’s Transport Ministry ordered ports on Friday to temporarily stop loading coal for export as the country struggles to meet domestic needs amid mounting power shortages. The coldest, snowiest winter in decades has left millions of Chinese without heating and running water, causing mounting losses from power shortages and other damage. The Transport Ministry’s emergency notice, posted on its Web site, ordered railways and other transport networks to make hauling coal …

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Below is a note on a new ETF that tracks coal stocks on a global basis.   I don’t like coal - either the substance or the stocks - but I must admit that from a global, rather than U.S., perspective they could represent a successful investment.    The article, courtesy of Seeking Alpha, starts below: Mining Black Gold With New Coal ETF posted on: January 11, 2008 | about stocks: AAUK / BHP / KOL / RTP Print …

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Jean Laherrère’s outlook for Coal wasn’t as bad as the previous ones, but still reminded that it is a finite resource.   For futher discussion on The Oil Drum, click here.

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After years of stagnant demand, coal has come back to life as producers worldwide respond to rising demand from developing countries. A tipping point came this year when China, one of the world’s leading producers, for the first time became a net importer of coal. read full post

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