Coal surge defies net zero ambitions

The International Energy Agency expects rapid economic recovery to drive coal demand to an all-time high in 2022. It has highlighted the surge in demand as a threat to the push for net zero and is calling for urgent policy action to rein in coal-related emissions. IEA executive director Fatih Birol. “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,” IEA executive director Fatih Birol said. “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 °C.” The IEA's annual market report shows the amount of electricity generated worldwide from coal surging towards a new annual record in 2021. After falling in 2019 and 2020, global power generation from coal is expected to jump by 9 per cent in 2021 to an all-time high of 10,350 terawatt-hours, the Coal 2021 report shows. It said the rebound was being driven by this year’s rapid economic recovery, which has pushed up electricity demand much faster than low-carbon supplies can keep up. Related: Protest pain continues for coal operations The steep rise in natural gas prices has also increased demand for coal power by making it more cost-competitive. Overall 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, overall coal demand could reach new all-time highs as soon as 2022 and remain at that level for the following two years, the IEA said. In China, where more than half of global coal-fired electricity generation takes place, coal power is expected to grow by 9 per cent in 2021 and in India it is forecast to grow by 12 per cent - reaching new all-time highs in both countries. While coal power generation is set to increase by almost 20 per cent this year in the United States and the European Union, that is not enough to take it above 2019 levels. Coal use in those two markets is expected to go back into decline next year amid slow electricity demand growth and rapid expansion of renewable power. Related: Surging coal revenue boosts Budget outlook“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,” IEA director of energy markets and security Keisuke Sadamori said. “Asia dominates the global coal market, with China and India accounting for two-thirds of overall demand. These two economies – dependent on coal and with a combined population of almost 3 billion people – hold the key to future coal demand.” In 2020, global coal demand fell by 4.4 per cent, the largest decline in decades but much smaller than the annual drop that was initially expected at the height of the lockdowns.

Coal surge defies net zero ambitions

Industry Queensland

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