Coal surge defies push for net-zero emissions
Global demand for coal is forecast to reach record levels next year, defying global efforts to tackle climate change.
Global demand for coal is forecast to reach record levels next year, driven by huge growth in China and India, defying global efforts to tackle climate change.
The International Energy Agency is predicting at least three years of surging demand for coal, just weeks after world leaders failed to agree on a phase-out of the fossil fuel source at climate change talks in Glasgow.
“All evidence indicates a widening gap between political ambitions and targets on one side and the realities of the current energy system on the other,” the IEA said on Friday.
“This disconnect has two clear implications: climate targets are getting further out of reach, and energy security is at risk.”
Energy Minister Angus Taylor said the IAE projections showed strong messages and targets alone would not address climate change. “Report after report points out the yawning gap between ambition and achievement,” he said. “That’s why a real plan to deliver on commitments is so important.”
Mr Taylor said technology was central to making net-zero emissions practically achievable for all countries.
China and India led the push against phasing out coal in Glasgow, opting to phase down coal use instead. Both countries are leading the surge in global coal consumption and continue to build new coal power stations.
“Global coal trends will be shaped largely by China and India, who account for two-thirds of global coal consumption, despite their efforts to increase renewables and other low-carbon energy sources,” the agency said.
While Asia is leading the way with higher coal consumption, the IEA says coal use has also jumped sharply in the US, UK and Europe as power generators switch out of high-priced gas.
The IEA report shows that a fall in demand for coal because of the pandemic was a temporary blip rather than a structural retreat. It underscores the gulf that exists between the targets being set to tackle climate change and the actions being taken.
Keisuke Sadamori, director of energy markets and security at the IEA, said: “The pledges to reach net-zero emissions made by many countries, including China and India, should have very strong implications for coal – but these are not yet visible in our near-term forecast, reflecting the major gap between ambitions and action.”
After falling in 2019 and 2020, global power generation from coal is expected to jump by 9 per cent in 2021 to a record high of 10,350 terawatt-hours.
Coal demand worldwide – including uses beyond power generation, such as cement and steel production – is forecast to grow by 6 per cent in 2021. That increase will not take it above the record levels it reached in 2013 and 2014.
But, depending on weather patterns and economic growth, the IEA said overall coal demand could reach a record high of 8.025 billion tonnes as soon as 2022 and then 8.031 billion tonnes by 2024.
Australia will retain its crown as the biggest global producer of metallurgical coal, used for steelmaking, with exports to lift 11 million tonnes by 2024 as producers continue to sidestep China’s import ban by selling supplies to rival buyers such as India and South Korea.
Consumption of thermal coal, used for power generation, will rise 7 per cent in 2021 although growth will remain constrained over the next three years amid environmental pressures and difficulty attracting financing to the sector.
The IEA says Australia’s thermal-coal industry is expected to shrink slowly as mine closures outpace capacity additions.
The agency expects Australia to produce 287Mt of thermal coal in 2024, about 31Mt less than in 2019, with lower demand for coal for domestic power generation contributing to the decline.
However, metallurgical coal production in Australia is expected to increase 11Mt by 2024.
The government’s commodity forecaster predicts thermal and metallurgical coal exports will contribute $57bn to export earnings in the 2022 financial year, up 46 per cent.
The IEA has previously said global coal use would have to plummet by 55 per cent by 2030 under a net-zero pathway to 2050 and declared no new coalmines or oil or gas fields should be opened.
Instead, demand for the polluting fossil fuel has lifted across the board in a blow for global ambitions to cut emissions.
IEA executive director Fatih Birol said: “Coal is the single largest source of global carbon emissions, and this year’s historically high level of coal-power generation is a worrying sign of how far off track the world is in its efforts to put emissions into decline towards net zero. Without strong and immediate actions by governments to tackle coal emissions – in a way that is fair, affordable and secure for those affected – we will have little chance, if any at all, of limiting global warming to 1.5 degrees.”
China, where half of all global coal-fired electricity generation occurs, will see generation for power use lift by more than 9 per cent in 2021 while India is expected to end this year with growth of 12 per cent.
Even the EU and the US, both aggressively making plans to push coal out of their system, are set to record a 20 per cent gain in coal power generation this year although those levels will remain below 2019 numbers.
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