Global coal consumption grew by 1.2% over 2021
(sustainabilityenvironment.com) – For the first time, in 2022 global coal consumption will exceed 8 billion tons. A growth of 1.2% compared to last year, which marks the new absolute record, surpassing the previous one that dated back to 2013. Driving the new appetite for the most polluting fossil source are the high gas prices linked to the Russian invasion of Ukraine, the lower nuclear output (mainly due to the problems in France) and several episodes of heat waves and droughts that have increased the demand for electricity.
What holds back and what makes global coal consumption soar
Despite this not very encouraging figure, the International Energy Agency (IEA) Coal 2022 report explains that it could have been much worse. Rising gas prices have made it economically viable to return to coal again, but some factors have dampened the growth of global coal consumption.
More expensive coal, strong diffusion of renewables and energy efficiency and weakening of global economic growth have slowed the race of this fossil fuel. A glance at what has happened to the world’s largest consumer of coal clearly illustrates the combination of driving forces and slowdowns. In China -where 53% of global coal is consumed- the Covid zero policy has curbed industry and therefore demand, while a series of droughts and long and intense heat waves have made the electricity demand soar.
Peak in 2022, drop from 2025
There is more good news in the IEA dossier.
First, the world’s largest coal producers (China, India and Indonesia) will reach record levels of output this year, but despite the economic climate guaranteeing profit margins, there is no sign of any growth in investment in export-oriented projects. However, it should be remembered that at the moment almost half (46%) of the main coal companies plan new coal-fired thermal power plants or new mining sites: the coal industry still has a pipeline of 476 GW.
The second good news: the agency led by Fatih Birol confirms that 2022 is the year of the coal peak. An advanced forecast already in 2021 and that has not changed despite the tremendous shocks to the global energy market of the last 18 months. After the peak, however, there will be a plateau: flat line for global coal consumption until 2025. After that date, the IEA expects consumption to begin to fall rapidly.