British coal imports to jump ahead of April 1 carbon tax hike

* Q1 2015 coal imports expected to rise 10-20 pct

* Buying spree expected to be short-lived

By Sarah McFarlane and Susanna Twidale

LONDON, March 31 (Reuters) - Britain's coal imports should show a spike for the first quarter of 2015 as utilities hoard ahead of a tax rise designed to encourage tehm to switch away from the more polluting coal-fired power generation.

From April, Britain's carbon tax, which charges power producers for each tonne of carbon dioxide (CO2) they emit, almost doubles to GBP18.08 per tonne.

In the short term, the impending jump in the tax rate has stimulated imports, but this is expected to end abruptly on April 1.

"By March utility stocks would usually be run down, as they build up stocks over summer, but with the higher price (of the carbon tax) coming in it makes sense for any utilities with the space to do so, to rebuild ahead of April," said Ronan O'Regan, a director at consultancy PwC.

Traders and brokers estimated first quarter imports would be up by around 10 to 20 percent compared with the previous year.

"In terms of imports it means they will front load in first quarter and you'll have less coming in during second quarter," said a broker.

In the first quarter of 2014, Britain imported 12.7 million tonnes, data from Britain's Department for Energy and Climate Change (DECC) showed.

Britain is Europe's second largest coal importer after Germany but its shipments are declining as old plants close.

Coal-fired power generation fell to a five-year low in 2014, government data published last month showed.

The carbon tax, introduced in 2013, was designed to help spur investment in low carbon technology and encourage utilities to switch fuels as coal-fired power generation produces almost double the amount of CO2 as gas-fired plants.

Preliminary figures from Britain's DECC show January coal imports hit an eight-month high of 3.5 million tonnes. February data has not yet been published.

The buying spree is expected to be short-lived, however.

"Clearly imports will slowdown fairly sharply after April 1," said David Price, global head of steam coal at IHS (NYSE: IHS - news) .

"We've got a few coal stations that won't run through to the end of the year. I think imports will go down further this year on the whole." (Editing by William Hardy)