Electricity systems around the globe are transitioning away from traditional coal fuelled power generation toward decentralised renewable energy systems. While the focus and pace of change varies from country to country, it is expected that many will see the end of coal fired power generation within a decade. The question increasingly being asked across the world is, how do we transition away from coal fired electricity generation in a way that’s commercially appealing, socially valuable, and feasible to implement? 

Along with the considerable technical challenges, the transition is equally an economic and social issue, as it impacts individuals, communities and environments that have been shaped by the coal industry for generations. This is why any transition must offer local populations a just and beneficial future – our development mantra should be that the end of an era should not become the end of an area.

Arup has been working with the stakeholders of transition such as energy asset owners, governments, developers, and local communities, to understand the most effective and inclusive transition pathways and processes. The Transition Pathway we have developed enables alignment between stakeholders and a just transition over the months, years and decades of the regeneration process.

What makes a transition?

What our work has revealed is that even when a coal power plant closure is conceptually understood and planned well in advance, considerations around the future use of the site are not, which may limit timely opportunities for positive change. It’s also worth stating at the outset, that the future of these sites doesn’t need to be energy-related – we can and should be imaginative about their future role, grounding opportunities for development in the aspirations of local populations.

The pathway of site transition is long and complex, from the earliest moments of coal power plant closure planning and aligning political considerations through to the detail of implementation, alongside the option of a transitioned asset that can conclude or maintain its role in the energy landscape. Over time, the process will migrate through a wide range of stakeholders, drawing on a variety of skills to shape the changes, encountering levels and types of risk, and heading toward different definitions of a successful outcome. To succeed, one has to understand this complex ecosystem fully, remaining ready to contextualise specific challenges in the wider pathway.

The 5 stage transition pathway

Our 5 stage transition pathway has been developed to deliver the overall process of such a transition. It recognises the migration of stakeholders, the skills required by different forms of transition and the evolving outcomes that will follow. By taking account of this always local ecosystem, we are able to effectively address specific issues of transition while making progress. 

The 5 stage transition pathway
The 5 stage transition pathway

The 5 stage transition pathway

Stage 1: Build a political mandate for future development

Given their prominence as nationally important infrastructure and regional employers, the future of coal power plants has a wider economic and political significance that must be considered. Combined with the integrated nature of coal power plants and supply chains, energy security considerations, and ownership structures, understanding and establishing an enduring political mandate for change is therefore the vital first stage. 

Addressing the political mandate involves aligning the redevelopment vision with relevant national or regional political context and drivers, such as the UK government’s ten-point-plan for a Green Industrial Revolution. In Australia, of the still operational power coal power stations, 35% are publicly owned while 60% are held by private entities. In each case, as stations reach end of life, the mandate for redevelopment will rely on relationships and communication between operators and authorities.

Stage 2: The transition vision must align with business strategy

If an asset owner is leaving coal power behind, how does a reimagined site fit into its future plans? Before defining (and investing in) its new role or purpose, operators or asset owners need to really ensure that the proposal aligns with the company’s wider long-term business strategy. This isn’t just commercially vital, it’s ensures local communities aren’t left with unrealisable plans or a failed site down the road.

A transitioned coal power plant is most likely to be shaped by the overlap between government and community priorities and corporate strategy of the asset owner. The outcome will need to align with regional government initiatives and plans, local needs, any broader commercial stimulus that might be going on, and other factors. At the highest level, the asset owner’s corporate strategy will help determine the scale of which alternative business models beyond their core operation should be explored, and appetite for investment or divestment.

Artist impression of Ratcliffe Gigafactory. Credit: Uniper

Illustrative masterplan of the Ratcliffe-on-Soar power station site. © Uniper

Stage 3: define the proposition for change – new uses for existing infrastructure

Power station site assets may be able to be reused or repurposed in the future, underpinning the redevelopment value proposition for the site. Some of these significant assets include access to electricity network connections, water supplies, land, transport connections, and power generation infrastructure among others. By undertaking closure and future land use planning in tandem, opportunities for reuse or repurposing of these remaining site assets can be realised.  

Beyond assets is the question of land use. During the decommissioning of coal power stations, and the planning and design of their adaptation to future purposes, a wide range of proposed new land uses will begin to emerge. Exploring these options rigorously is central to building a resilient, thoughtful and ultimately successful plan for redevelopment.

Every site is different, but redevelopments tend to comprise complementary clusters of primary and secondary uses that catalyse different parts of the site at different stages of its redevelopment. Coal power stations tend to comprise valuable assets that could be costly and difficult to replicate at a new location, so there is clear financial sense to adapting what’s in place to play new roles.

One transition – many uses

Project
Battersea Power Station Masterplan
Render of the Battersea Power Station redevelopment

If you picture a former coal power station reimagined as a vibrant new industrial hub with offices, commercial and retail opportunities, the list of related possibilities is promising. One could use the site for an on-site data centre that reuses the existing grid connection, cooling system, data and communication system as well as structural steel on site. Industrial and commercial businesses could reuse existing chillers, water connections and water treatment system. Warehousing or manufacturers would benefit from the existing buildings on site with freight logistics benefitting from the estate’s rail connections. Office or retail could move into a turbine hall – something we’ve seen realised at Battersea Power Station in London. Energy from waste facilities could reuse a coal plant’s cooling system. If a site is being considered for green hydrogen production, it could reuse the station’s ammonia plant. These are just a few of the many re-engineering possibilities.

Fundamentally, real understanding of stakeholders’ needs and agendas is critical to an effective proposition for change. You’re looking for opportunities to identify shared goals, which means engaging with regional partners, recognising local government interests and possible investors, bringing in interested businesses and unlocking relevant funding streams.

Stage 4: Securing the proposition – translating a vision into reality

The next stage is to articulate the vision for change to the entire range of related parties. This means positioning the project within the context of national and/or regional priorities and as an investment priority, showcasing the vison to potential partners and collaborators. Schemes will likely need to secure the power to offer incentives that will attract major investors to the area. It will mean reducing existing bureaucracy and operating in a lean, flexible and decision-focused way to expedite the development process. These measures will build investor confidence and momentum, garner public support, backed by early pursuit of “no regret” options. The result should be a scheme design that builds on the legacy of the coal industry in the region, with a credible offer to present to future generations of local people.

The people in the surrounding community give you the social license to enable change. They hold an incredible amount of power and asset owners need to understand the role of the stakeholder in any engagement.

Malcolm Smith

Director, Arup

Stage 5: The implementation phase – delivering change that works

To achieve the socio-economic outcomes and the just transition we all want to see, the mantra must be that: how a site is developed is as important as what is developed.

Implementation of physical change at the site, while complex, will only be the first generation of change for the site, the community and the future. At each stage of development, it’s vital to build on what’s been learnt from stakeholders and other local actors, to allow the flexibility for continual evolution and testing of outcomes over time. The detailed work from the previous stages brings together the engineering, design, economics and planning to deliver an enduring and thriving transition at the site.

Real, tangible change ‘on the ground’ means new land use activities and redevelopment, community growth, development of new clean energy production or completely new industries, and good quality jobs and skills. To be inclusive and valuable, this holistic definition of success must remain central to the project’s identity and purpose over the long term.

An opportunity to make generational change

So that’s our 5 stage transition pathway – we hope it’s a useful way to think about what will always be a generational development for any coal community. Understanding each stage of the transition pathway creates the capability to develop each individual step in an efficient way. Effective, human-centred masterplanning is the right approach, and these transitions must mean thinking long-term, learning from communities, identifying sustainable commercial opportunities, making your case with honesty and confidence – and recognition that redevelopment is an evolutionary process.