Global coal falls as gas rises, IEA report on world energy balance shows

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Rio Tinto's coal operations in Australia. Copyright © 2014 Rio Tinto

By IAC Staff

Global coal production fell significantly in 2016, while global trade in natural gas was up, according to the World Energy Balances report by the International Energy Agency (IEA).

The report said that coal production fell sharply in China in 2016 by around 320 million tonnes or 9% – a fall equal to more than the total production from South Africa, the world’s 5th largest coal exporter. Coal production also fell elsewhere, such as the US and Australia, leading to global output falling by 458 million tonnes.

One reason why production fell in China was lower demand, particularly for power generation, though China still uses half the world’s coal. Lower coal demand has also been seen across the OECD, specifically in the US and the UK. So globally, despite an increase in India, global coal consumption in 2016 fell by around 2% in energy terms, the report added.

The move away from coal generation is most clear within the OECD, where electricity generation from gas in 2016 was virtually equal to coal generation for the first time ever, it said.

According to the report, greater demand for gas led to increases in trade, with growth in pipeline gas trade going into the OECD and LNG trade going to Asia.2 Together the increases saw total global gas imports increase by about 47 billion cubic meters (bcm) in 2016 – around 4.5% higher than 2015.

Alongside the growth in gas generation, 2016 also saw the continued increase of renewable generation across the OECD and in countries like China, the report said. In the OECD, renewables generation grew by 3.8% to account for 23.8% of all electricity generated, its highest share to date. The growth was largely driven by wind and solar PV, which saw annual average growth rates of 21% and 43% between 2000 and 2016, it added.

Shares of fuels in global energy demand changed little from 2014 to 2015. In fact, aside from oil and gas, which have changed their shares significantly over the past forty years, the overall shares of fuels in global energy demand have changed little since 1971.

Oil remains the most used fuel, mainly for transport, followed by coal, mainly for electricity generation..

Likewise the share of energy use across the world was similar in 2015 to 2014, but the past 40 odd years have witnessed a significant change: Non-OECD Asia is now virtually matched with the OECD as the leading energy consumer.

 

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