(Repeats earlier story for wider readership with no change to text. The opinions expressed here are those of the author, a columnist for Reuters.)
By Clyde Russell
LAUNCESTON, Australia, May 14 (Reuters) - Proponents of both renewable energy and fossil fuels see opportunities for growth as the world emerges from the coronavirus pandemic, but working out who has the upper hand largely depends on the actions of governments and financiers.
With much of the world still struggling to contain the new coronavirus and economies devastated by lockdowns, so far the only thing that's clear is that 2020 is going to be a bad year for new investments and projects.
New wind power installations may drop 12% and solar by 8% in 2020 compared with forecasts prior to the coronavirus outbreak, according to research by Bloomberg New Energy Finance.
The hit comes at a time when renewables were gaining more ground on fossil fuel projects, having been increasingly able to undercut coal- and natural gas-fired power ventures.
Solar and onshore wind are now the cheapest sources of new-build generation for at least two-thirds of the global population, Bloomberg New Energy Finance said in an April 28 report, while battery storage is now the most cost-effective source of peaking power.
It's this cost edge that leads to green activists and some market analysts believing that renewables have the advantage when it comes to future generation.
This is almost certainly the case in Europe, and possibly in North America, but in Asia, where the biggest share of energy generation growth is going to be in the coming decades, it's less assured.
In India, a 1,200 megawatt (MW) tender for solar power with battery storage closed at under 6 U.S. cents per kilowatt hour (kWh), according to consultants Eurasia Group.
This is well below the 10 cents per kWh needed for a modern natural gas combined cycle turbine and the 7-9 cents for a coal-fired power plants, Eurasia Group said in a May 12 note.
Similar to India, Australia is blessed with both vast coal reserves and near-perfect conditions for solar, and in some places wind power as well.
Also similar to India, Australia's experience is that renewable energy projects seem to be easier to bring to fruition, with several major announcements in recent weeks.
These include environmental approval for a giant 9,000 MW wind and solar plant in the north of West Australia, which aims to supply power domestically as well as via an undersea cable to Indonesia.
A 400 MW solar farm in eastern Queensland is slated to begin construction in coming months after signing a power purchase agreement with a state-owned generator.
The island state of Tasmania is also progressing plans to spend A$7.1 billion ($4.3 billion) to double its existing hydropower capacity and build a new undersea cable to the mainland, allowing it to serve as backup power to renewable generation.
All of these projects are progressing despite Australia's federal government being controlled by the Liberal-National coalition, which is noted for being pro-coal and natural gas and containing within its ranks of parliamentarians several climate change sceptics.
COAL SUPPORT
There are currently no advanced coal-fired power projects in Australia, although the federal government gave A$4.4 million to a little-known company to study the feasibility of a new plant in Queensland.
The lack of new coal-fired projects in a country that vies with neighbouring Indonesia for the title of the world's biggest coal exporter likely shows that new coal plants just can't compete on costs, even in a country with a pro-coal government and no price on carbon emissions.
However, it is also clear from developments in the rest of Asia that coal can remain in the mix if it receives subsidies of some kind from governments, or state-backed organisations such as development banks.
These may include soft loans and favourable tax treatments, as can be seen in China, where stimulus funds are being channelled into new coal-fired projects, even though the capacity utilisation at existing power plants is falling.
South Korea's new government is publicly committed to cleaner power, but two state policy banks provided a $2 billion bailout to Doosan Heavy Industries and Construction, a top maker of coal-fired power plants. Asian countries that are planning to invest in new coal-fired capacity may also be increasingly reviewing those decisions, given the price decline for renewables, and even the likelihood that liquefied natural gas (LNG) will remain cheaper for longer given the current and projected oversupply of the super-chilled fuel.
While it's way too early to declare victory for renewables and defeat for coal, and even for LNG, there are some trends that point in this direction.
The first is that increasingly renewables are cheaper than the alternatives, meaning private and public capital is attracted to them.
The second is that new coal-fired power in Asia is highly unlikely in the absence of some kind of government or semi-official support and subsidies.
The third is that private capital is increasingly abandoning coal as environmental pressure is ramped up and companies are targeted by activists and increasingly shareholders if they are doing the wrong thing on climate change. (Editing by Christian Schmollinger)