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Coal demand surges to fuel China & India

London, 30 August 2010

M&C Energy Group has called on the international community to place additional pressure on China and India to switch to cleaner energy sources. The request comes as industry experts predict that global coal demand, already at a record high, will remain strong even as the recession has reduced oil and gas consumption.

This trend defies international efforts, most recently at Copenhagen, to phase out unabated burning of the most-polluting fossil fuel and according to M&C’s energy analyst, David Hunter, companies in India and China, which already have a lower cost base, are benefiting from cheaper energy sources.

Mr Hunter said: “This is clearly not a level playing field.  In the UK, businesses are carrying the financial burden to support the drive to reduce carbon emissions; meanwhile their competitors in China and India are benefiting from much cheaper energy and bear no financial burden for reversing the effects of global warming.

“While some would argue that the emerging nations are enjoying the benefits the West had during the industrial revolution, M&C believe that valiant efforts to cut emissions are being wiped out by over-reliance on coal by countries such as China and India.”

M&C, which is working with clients to cut consumption and switch to cleaner energy sources, believe that businesses in the UK will question whether costly environmental legislation is yet another nail in the coffin for UK manufacturing.

Mr Hunter added: “It does seem ludicrous that big energy users are being so blatantly disadvantaged. Not only do they have to pay for carbon emissions – a by-product of the energy used to produce their products – but also their cost of production is so much higher due to more expensive energy and the burden of environmental legislation. M&C believe that all businesses, wherever they are based, must share jointly in the responsibility and thereby the cost of cleaning up the environment.”

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Comment by David Hunter, Energy Analyst, M&C Energy Group.