An energy company listed on the London Stock Exchange is planning to spend up to an estimated $6bn (£3.8bn) building eight coal-fired power stations that could add tens of millions of tonnes of carbon to the atmosphere.

Essar Energy has just brought online the first part of the 1,200MW Salaya 1 plant in Gujarat on the west coast of India and says this and other stations are needed to counter power shortages. The move comes after countries around the world met in Durban, South Africa, this month to try to hammer out a new climate change treaty to cut global CO2 emissions.

Britain is introducing cleaner fuels and phasing out its old coal-fired power stations while saying that new ones would need carbon capture and storage schemes attached. But a spokesman for Essar, which is listed on the FTSE 100 but operates largely in India, said its customers on the subcontinent could not afford the extra costs associated with subsidising cleaner technologies.

“You have to remember that India is a place where 44% of households do not have any power at all and demand is rising by 10% per annum. Equally, the per capita power use in India is 736 kilowatt hours [per year] compared with 2.5m in China and 14.3m in the US,” he added.

Essar, one of many foreign-based resources companies listed in London, was unable to say exactly how much carbon would be produced from the eight planned plants, which would generate around 8,000MW of power. “We are currently in the process of collating these for our sustainablility report which will be out next year,” said the spokesman.

The biggest coal power plant in Britain – Drax in north Yorkshire – has generating capacity of 4,000MW and in 2007 generated 22m tonnes of CO2. This figure has been reduced as Drax starts to burn wood and other biomass as well as coal.

Indian power companies are pushing the government to allow them to cut down forests so that they can press ahead with new coal mines. Essar has pledged to plant more new trees than it clears, though that promise is unlikely to satisfy many environmentalists.


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