Aerial file photo dated 21/04/2004 of Drax power station in Selby, North Yorkshire.  The revival of coal as a fuel source was underlined when the UK's largest coal-fired power station smashed expectations for its annual profits, Wednesday March 8, 2006

High demand for gas will push prices up by the 2020s

New research has shown that coal power will continue in the UK until the 2020s.

The research from Aurora Energy Research has shown that coal will make a come back in the UK due to its affordability relative to gas.

The research shows that rising global demand for gas will lead to a price increase, making gas less economical than coal despite the heavy carbon price of £23 a tonne. The government would have to raise the price of carbon to £40 a tonne to make it non competitive with gas.

The UK’s carbon price is significantly higher than the rest of Europe, which values carbon at £5.34 a tonne.

This research comes as the energy secretary in the US, Rick Perry, has made a stand for reliable energy such as coal nuclear power.

Mr Perry highlighted the role of coal and nuclear power stations with ensuring energy security in the wake of national disasters such as Hurricane Harvey or Storm Sandy. “It is especially urgent to prevent premature retirements of the resources that have these critical attributes” he said.

The secretary’s intervention comes as the US is answering calls from the developing world about the need for reliable energy to aid development. The US is set to use its position on the World Bank to support the use of fossil fuels in the developing world.

In his letter the secretary highlighted the vital role of coal fired power stations following the Polar Vortex in 2014. The vortex created a large spike in demand which was answered by coal fired power stations due to be closed down. Had it not been for those power stations 65 million people would have been left without power.

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