Global coal demand likely to decline 2.3% by 2026
- According to a report by the International Energy Agency (IEA), the global coal demand is expected to decline by 2026 .
- This is despite the global coal production reaching an all-time high in the current year.
Factors Influencing Decline
- The shift towards renewables contributes to the expected decline.
- China and India play crucial roles, with India being a "driving force" until 2026.
- The IEA’s expectations of a decline in coal demand is also premised on a change in global climate.
- The current El Nino conditions are expected to turn to La Nina and generally linked to better rainfall during 2024-2026.
- This will presumably translate to greater hydropower output.
Regional Variances in 2023
- Global coal demand to rise by 1.4% in 2023, exceeding 8.5 billion tonnes.
- It will surpass 8.5 billion tonnes for the first time.
- EU and US demands are expected to drop 20%.
- However, India and China see increases (8% and 5% respectively) due to electricity demand and diminished electrical generation from hydropower.
Renewable Energy Impact
- An anticipated increase in low-cost solar photovoltaic deployment is expected to aid renewable power generation.
- Also, the nuclear generation is expected to see moderate increases in China, India, and the EU.
- Coal-fired generation is likely to be pushed into a downward trajectory from 2024.
China's Role
- China currently accounts for over half of the world's coal demand.
- Major expansion of renewable energy in China is expected to lead to a fall in coal demand from 2024, plateauing in 2026.
- Overall, this will result in a 2.3% fall in global call demand by 2026.
Environmental Impact
- Coal is the most important energy source for electricity generation, steel-making, and cement production.
- However, it is also the largest source of carbon dioxide (CO2) emissions from human activity.
- Despite forecasts of decline, global consumption is expected to remain above 8 billion tonnes through 2026.
Climate Policy Agreements
- Reduction of unabated coal use is a key agreement among countries under the United Nations Framework Convention on Climate Change.
- To limit temperature rise to 1.5°C by 2050, coal emissions must decline by nearly 95% between 2020-2050.
Global Production Trends
- China, India, and Indonesia, the top coal producers, are expected to break output records in 2023.
- These three countries now account for more than 70% of the world’s coal production.
Prelims Takeaway
- International Energy Agency (IEA)
- Paris Agreement
- UNFCCC