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Rising China, India Consumption Spark Coal Use Surge

Traditional fossil fuels should be phased out only when renewable sources are reliable, Chinese policymakers have concluded

China coal
China won't change course on coal, although its promise last year to stop financing overseas projects has already seen 13 GW of coal-fired plants cancelled. File photo: AFP.


Rising consumption in China, India – as well as in the US – could bring global coal-fired power demand to a new all-time high this year, undermining efforts to cut greenhouse gas emissions, the International Energy Agency (IEA) said on Friday.

Global power generation from coal was expected to reach 10,350 terawatt-hours in 2021, up 9%, driven by a rapid economic recovery that has “pushed up electricity demand much faster than low-carbon supplies can keep up”, IEA said,

Overall coal demand, including for industries such as cement and steel, is expected to grow 6% this year.

It will not exceed the record consumption levels of 2013 and 2014 but could hit a new all-time high next year, the IEA report said.

Fatih Birol, IEA executive director, said the increase was “a worrying sign of how far off track the world is in its efforts to put emissions into decline towards net zero”.

China is responsible for more than half of global coal-fired power generation and is expected to see a 9% year-on-year increase in 2021, the IEA said.

Chinese officials have placed priority on energy security despite the country’s decarbonisation goals.

Researchers with China’s State Grid Corporation published a report showing that energy security concerns mean the country is likely to build as much as 150 gigawatts (GW) of new coal-fired power capacity in 2021-2025, bringing the total to 1,230GW.

Concerns Over Reliability

Traditional energy should be phased out only when renewable sources are sufficiently reliable, the Communist Party’s recent Central Economic Work Conference concluded.

Beijing has pledged to boost “investment before de-investment” by encouraging more use of renewable energy with more incentives, while keep traditional energy as a reliable provision in the interim.

Coal energy, currently about 64% of power generation, would “continue to be promoted in the near term as a viable option to resolve renewables’ intermittent problems in the electricity system”, Simon Lee, a utilities analyst at Morgan Stanley, said.

Coal-fired generation in India is forecast to grow 12% this year.

Cutting coal use was a major bone of contention at climate talks in Glasgow last month, with countries finally agreeing to “phase down” consumption as part of their efforts to keep global temperature rises as close to 1.5 degrees Celsius as possible.

China has already made a pledge to start reducing coal consumption, but will do so only after 2025, giving developers considerable leeway to raise generation capacity further in the coming four years.


  • Reuters, with George Russell




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George Russell

George Russell is a freelance writer and editor based in Hong Kong who has lived in Asia since 1996. His work has been published in the Financial Times, The Wall Street Journal, Bloomberg, New York Post, Variety, Forbes and the South China Morning Post.


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