Bulk terminals hit by power plant closures

As imports of key dry bulk commodities dry up, research from the Advisory Panel to the Association of Bulk Terminal Operators (ABTO) has shown it is resulting in over-capacity of bulk terminals in the UK, especially amongst larger ports and terminals.

Justin Atkin, the managing director of Ragged Edge Recruitment and Consulting and member of the advisory panel to the ABTO, said: “Coal-fired power stations are closing as the government continues with its policy to decarbonise heavy industry in the UK to meet emissions reduction targets, but the promised uptake of biomass as an energy source has failed to happen on the scale that was first anticipated.

“The expectation was that the government would seek to maintain a balanced generation portfolio including the conversion of existing coal-fired power stations however the lack of a clear policy strategy and corresponding levels of financial subsidy have not supported the transition to biomass.”

“Understandably there has been little appetite by power station owners to invest in the conversion without government help.”

This is an example of where environmental policy has not always had a positive impact on terminals and ports.

The UK’s reduced requirement for coal, together with an increase in the Carbon Floor Price to £18 per tonne of CO2, saw exports from Russia, Colombia and the U.S.A plummet by 69% in the first seven months of 2016.

During the same period of 2016, total UK coal imports were down 65%.

Ian Adams, ABTO chief executive, concluded: “We are very concerned that other Administrations could take similar action to those of the UK government, which will have a devastating effect on bulk terminals.”

“The whole premise of the Carbon Floor Tax was to provide subsidies to encourage a switch to renewable energy. The government does need to consider how this is implemented fairly, effectively and efficiently so that bulk terminals can remain viable in a decarbonised future.”