The International Energy Agency stated on Friday that the demand for coal is expected to have peaked globally this year and may decline by roughly 2% over the following three years as China increases the use of renewable energy sources.
The Paris-based organization has never before forecast a decline in demand for dirty fuel over three years.
According to the IEA’s annual coal market report, demand is expected to peak at 8.54 billion metric tonnes (9.4 billion tonnes) this year, exceeding the previous record of 8.42 billion metric tonnes set in 2022.
According to the agency, demand will begin to decline in 2024 and will do so by 2.3% by the end of 2026.
The IEA’s director of energy markets and security, Keisuke Sadamori, stated that the prediction indicated that “a turning point for coal is clearly on the horizon.”
“Global coal demand has declined on a few occasions, but these have been temporary and have been brought on by extraordinary events like the fall of the Soviet Union or the Covid-19 crisis,” he said in a press release.
“This time seems different because the decline is more structural and is being fueled by the persistent and powerful growth of clean energy technologies.”
According to the IEA, China will account for more than half of the renewable energy capacity that comes online over the next three years. The nation currently supplies more than half of the world’s coal needs, according to the agency.
A historic call to move away from fossil fuels was made in a new global climate agreement that was reached on Wednesday at the COP28 summit. However, the agreement’s ambiguous wording may allow some governments to take only minimal action.
The agreement does not mandate the global “phase out” of natural gas, coal, and oil, as many climate groups and over 100 countries have demanded.
China is going to “have the last say.”
According to the IEA, the demand for coal has decreased in almost all advanced economies this year, primarily due to a record decline of about 20% in the US and the EU.Due to low hydropower output and rapid growth in electricity needs, demand is expected to have increased by more than 8% in India and by roughly 5% in China this year.
According to the IEA, while global demand for coal is expected to decline over the next three years, China’s ability to increase its share of clean energy is a major factor.
In its report, the agency stated that China would “have the last word” and that “the availability of hydropower is a key variable in the short term, since coal is used as a substitute when hydro underperforms in the country.”
The Chinese government promised to “vigorously develop new and clean energy” and strictly regulate the use of coal in an action plan it released last week to improve the quality of the air.
The plan calls for a greater role for non-fossil fuel energy, the promotion of electric vehicles, and the movement of more freight across the nation by rail and waterways rather than by road in order to reduce the density of dangerous airborne particles known as PM2.5 by 10% by 2025 compared with 2020 levels.
According to the IEA, in order to keep global warming to 1.5 degrees Celsius over pre-industrial levels, the use of “unabated coal” would need to decrease “significantly faster” than it is now. Global coal consumption would still be well over 8 billion metric tonnes in 2026.
An IEA spokesperson explained to reporters that “unabated coal” is defined as coal burned without capturing and storing its emissions of carbon dioxide, which warms the planet.
