IEA: WORLD COAL DEMAND MAY REACH RECORD NEXT YEAR

Posted 20 December, 2021

The rise in coal consumption is driven by the rapid recovery of the global economy, soaring natural gas prices, and the inability of green energy to meet electricity demand, the International Energy Agency said in a report on Friday.

 

FIG.1

Global consumption of coal by regions of the world in 2020-2024 (left) and changes in consumption of coal by regions of the world in 2021-2024 (right). Source: IEA

 

An attempt to radically "green" the world economy has unexpectedly led to a sharp increase in the global consumption of coal for electricity generation. From a report published yesterday by the International Energy Agency, it follows that in 2021 a record 10,350 terawatt-hours were generated from coal, which is 9% more than in 2020. This was the result of ill-considered economic and political decisions, such as the decommissioning of power plants operating on oil and coal, as well as the refusal to finance the development of fossil fuels.

"The growth (in coal consumption) is driven by the rapid recovery of the global economy," the IEA said in a report. “Against this backdrop, the demand for electricity grew much faster than the capacity of power plants operating on low-carbon fuels.”

In addition, the increased use of coal was fueled by a sharp rise in natural gas prices.

According to the IEA, global demand for coal, including from such "dirty" sectors of the economy as the production of cement and steel, will grow 6% this year and may reach record levels next year (however, the baseline forecast suggests that this still won't happen). China accounts for about half of the world's coal-generated electricity, and this figure is expected to grow by 9% in 2022. In India, electricity generation from coal is forecast to grow by 12% in 2022, according to the IEA.

IEA Executive Director Fatih Birol also noted that the rise in demand for coal, "which is the main source of greenhouse gas emissions, is an alarming indication of how far the world has come in its efforts to bring greenhouse gas emissions to zero."

“The pledges to bring CO2 emissions to zero from many countries, including China and India, should have massive and far-reaching implications for coal. However, these prospects are not yet included in our short-term forecast, which reflects the gap between ambition and real possibilities, ”says Keisuke Sadamori, IEA director for energy markets.

In early November, US Treasury Secretary and former Fed Chairman Janet Yellen noted that, according to some estimates, achieving the goal of net-zero greenhouse gas emissions could cost $ 100-150 trillion in the next three decades.

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