Europe: Paying the Price for Closing Coal (Part 1)

Will Rogers once said: "If you find yourself in a hole, stop digging."

Nevertheless, Europe continues to shovel deeper and deeper. The recent and projected increases in electricity prices in the EU are damaging the future of European families, businesses and communities. Electricity is the sine qua non of modern civilization. Societies which have ready access to abundant, reliable and affordable electricity prosper while those who do not have populations which are mired in energy poverty, adversely impacting virtually every dimension of life. In the case of Europe, the high cost of electricity not only impacts the present but also significantly constrains the future - especially in regard to the benefits of AI and the associated data centers which require 24/7 power at affordable rates. Evidence is rapidly accumulating that EU energy policies are relegating its member states to "also-ran" status in the race for Artificial Intelligence.

Coal has been the undeniable foundation of modernity for upwards of two centuries and still provides almost 35% of the world’s electricity, 74% of steel, 85% of cement and is a significant contributor to the production of many other crucial materials. Our current civilization would not exist without coal.

Within the last decade, however, a number of European countries have moved away from coal generation to pursue: (1) natural gas – not only does 90% of gas have to imported but it is also the fuel with the greatest price volatility and (2) wind and solar - despite their intermittency, a vast array of hidden costs, and the need for never-ending subsidies. The decline of coal is real. In 2015 coal produced 23% of UK electricity but has now disappeared from the scene. In Germany, coal produced 44% of electricity just 10 years ago but merely 22% in 2025. And in Italy, 17% of electricity was produced by coal in 2015, but now that number is barely 1%. The negative socio-economic impacts of this decline in coal-based electricity are succinctly summed up by Fairless and Colchester’s piece "Europe’s Green Energy Rush Slashed Emissions - and Crippled the Economy" in a recent Wall Street Journal article.