The amount of electricity produced globally from coal hits a new annual record in 2021, undermining efforts to reduce greenhouse gas emissions and potentially putting global demand for coal on track to achieve a all-time high next year, the International Energy Agency said in its latest report. annual market report.
After falling in 2019 and 2020, global coal-fired power generation is expected to jump 9% in 2021 to a record 10,350 terawatt-hours, according to the IEA. Coal 2021 report, which was released today. The rebound is due to this year’s rapid economic recovery, which has driven demand for electricity much faster than low-carbon supplies can keep up. The sharp rise in natural gas prices has also increased the demand for coal-fired electricity making it more cost competitive.
Aggregate demand for coal in the world – including uses beyond power generation, such as cement and steel production – is expected to increase by 6% in 2021. This increase will not lift it above record levels reached in 2013 and 2014. But, depending on weather conditions. and economic growth, aggregate demand for coal could reach new historic highs as early as 2022 and remain at that level for the next two years, underscoring the need for swift and strong political action.
“Coal is the largest source of carbon emissions in the world, and the historically high level of coal-fired power generation this year is a worrying sign of the world’s distance in its efforts to bring emissions back to. net zero, “said the director of the IEA. Director Fatih Birol. âWithout strong and immediate action by governments to tackle coal emissions – in a way that is fair, affordable and safe for those affected – we will have little or no chance of limiting global warming to 1, 5 Â° C. “
In China, where more than half of the world’s coal-fired electricity production is produced, coal-fired electricity production is expected to grow by 9% in 2021 despite a deceleration at the end of the year. In India, it is expected to increase by 12%. This would set new all-time highs in both countries, even as they deploy impressive amounts of solar and wind capacity. While coal-fired power generation is expected to increase by almost 20% this year in the United States and the European Union, that is not enough to lift it above 2019 levels. these two markets are expected to fall back next year amid slow growth in electricity demand and rapid expansion of renewables.
“The promises of reaching 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 short-term forecast, reflecting the major gap between ambition and action, “said Keisuke Sadamori, director of energy markets and security at the IEA. âAsia dominates the global coal market, with China and India accounting for two-thirds of global demand. These two economies – dependent on coal and with a combined population of nearly 3 billion people – hold the key to future demand for coal.
In 2020, global demand for coal fell 4.4%, the biggest drop in decades but much smaller than the annual drop that was initially expected at the height of lockdowns at the start of the pandemic, according to the report. Regional disparities were significant. Demand for coal grew by 1% in a full year in China, where the economy started to recover much earlier than elsewhere, while it fell by almost 20% in the United States and the Union. European, and 8% in India and South Africa.
Coal prices have been on a roller coaster over the past two years. After falling to $ 50 per tonne in the second quarter of 2020, they began to climb towards the end of the year, with reductions in supply balancing the market before rebounds in economic activity and demand for coal began to rise. China does start to push up the prices. In 2021, prices rose further due to demand exceeding supply in China – the global pricing body for coal – as well as supply disruptions and rising prices for natural gas. in the world. Coal prices hit all-time highs in early October 2021, with thermal coal imported into Europe, for example, reaching $ 298 per tonne. Quick political intervention by the Chinese government to balance the market had a quick effect on prices. In mid-December, European prices fell back below USD 150 per tonne.