Coal demand rises 6% in 2021 and will hit record levels since 2022

Ground Report | New Delhi: Coal demand rises in 2021; The global demand for coal, which was reduced by the crisis less than anticipated last year, will recover more than in 2021 lost ground, with an increase of 6%, and from 2022 will be at record levels that make it nearly impossible to meet targets to limit climate change.

Coal demand rises in 2021

This is the black scenario presented in its annual report on the coal market by the International Energy Agency (IEA), which highlights that the key to the future is in China, which represents more than half of world consumption, and also in India, with which they add two thirds.

Without strong and immediate action by governments to tackle carbon emissions - in a fair, affordable, and safe way for those affected - we will have very little chance, if any, of limiting global warming to 1.5 degrees centigrade ”, warns the executive director of the agency, Fatih Birol.

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The first months of the pandemic in 2020, with the Chinese economy largely stopped, suggested that the use of coal, which is the main fuel that causes global warming, could collapse at a double-digit rate. Things were not like that.

China recovered in the latter part of the year and its appetite for coal was up 1% for the year as a whole. Taking into account the relative weight of the Asian giant, the worldwide decline was limited to 4.4%, although in relative terms there were 20% sinks in the United States and the European Union.

High Gas Prices Favor Coal

This year not only has the economic recovery been generalized, but the very high prices of natural gas are favoring the use of coal as a substitute to generate electricity, with an increase of 9% for that use.

This means that in absolute terms so much coal has never been used to produce electricity (10,350 terawatt-hours) even though its share of 36% is five percentage points lower than the historical peak of 2007.

The authors of the report estimate that Chinese demand for coal will continue to grow in the next three years at an average annual rate of 1.1%. It will be aimed essentially at electricity because the expansion of capacities to generate with renewable energy, the largest in the world, or with nuclear power plants will not be enough to cover its economic pull.

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With 4,266 million tons in 2024 out of a total of 8,031 worldwide, China will also continue to be the main cause of the global rise in absolute figures (135 million tons more between 2022 and 2024), closely followed by India, where expects an annual progression of 3.9%, to 1,185 million.

In India, the weight of coal in the production of electricity is even going to increase this year, going to 74%, compared to 72% in 2020. As if that were not enough, your government has plans to invest tens of billions of euros in other uses of coal for the next few years.

These two giants and other Asian countries will eat very widely the declines expected during that period in the United States (-15%) and even more so in the European Union (-18%).

A cojuntural rise in US

In these two blocks of the developed world, the progression in the use of coal that is being observed in 2021 is purely temporary, as a result of the recovery after the doldrums of the crisis and as a temporary alternative to gas, which has gone through the roof. , and will not change the trends that have been observed for years.

The IEA insists that the gap between the political statements of countries promising to achieve the goal of net zero CO2 emissions and the reality of the coal market is widening, in particular as insufficient funds are being put in for clean energy and technologies.

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