Coal may no longer be the uncontested king of the electric generating hill, but the dusky diamonds retain a baronial position. And overall, counting uses in other industries, coal continues to rule to energy roost.
Last month, the International Energy Agency predicted that for 2022, “Global coal use is set to rise by 1.2% in 2022, surpassing 8 billion tonnes in a single year for the first time and eclipsing the previous record set in 2013…. Based on current market trends, the report forecasts that coal consumption will then remain flat at that level through 2025 as declines in mature markets are offset by continued robust demand in emerging Asian economies. This means coal will continue to be the global energy system’s largest single source of carbon dioxide emissions by far.”
The IEA said, “Coal markets have been shaken severely in 2022, with traditional trade flows disrupted, prices soaring and demand set to grow by 1.2%, reaching an all-time high and surpassing 8 billion metric tons for the first time.”
The IEA notes, “The current energy crisis has forced some countries to increase their reliance on coal in spite of climate and energy targets.” That’s a reference to Russia’s invasion and war in Ukraine, which has roiled natural gas markets in large swaths of Europe. Germany, for example, has returned to coal, as well as keeping some nuclear units slated for closure operating.
Writing in Real Clear Energy in November, during the COP27 international climate conference in Egypt, veteran energy reporter Robert Bryce cited another IEA report, which, he summarized, concluded that “the hard reality is that coal continues to be an indispensable fuel for power generation and industrial production. For proof of that, we need only look at India and China.”
Earlier this month (Jan. 2), OilPrice.com reported that global coal demand will remain high in 2023, noting, “Asia’s coal market is expected to continue expanding rapidly for several years to come. Although China pledged to stop constructing new coal plants overseas, halting existing coal plans in its Belt and Road Initiative (BRI), it continues to pump funds into its national coal developments.”
S&P Global reported last month that coal producers in “Indonesia, China and India have all announced higher production targets for the next year as part of their larger goal of meeting domestic needs internally….”
In a related development, the New York Times yesterday (Jan. 9) cited a Rhodium Group report that estimated “that greenhouse gas (GHG) emissions in the US slightly increased in 2022, rising 1.3% compared to the previous year. While this is the second year in a row that emissions have increased, it nonetheless marks a change from 2021, when emissions rebounded faster than the economic growth rate. This reversal in 2022 was largely due to the substitution of coal with natural gas—a less carbon-intensive fuel—and a rise in renewable energy generation.”
The Rhodium Group report said that its current estimates (the government’s official numbers won’t be available until September) reflect a return to normality from the Covid pandemic years. “In 2020,” the report said, “the pandemic had a significant impact on the economy, causing GDP to decline by 5.9% and emissions to drop by 10.6% compared to 2019, the largest decrease in emissions since the 2008 recession. However, in 2021, GHG emissions rebounded faster than economic growth—GHG emissions rose by 6.5%, while GDP rose by 5.9%—primarily due to an increase in coal generation and a modest recovery in transport demand. By contrast, in 2022 GDP growth outpaced the increase in GHG emissions.”
–Kennedy Maize
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