Usage of coal is reaching record levels in India and China: IEA

The International Energy Agency (IEA) has called on China and India to reduce coal power generation and put their climate pledges into action, describing both countries as “holding the key to future coal demand”. The world’s two largest coal producers – with economies that account for nearly three billion people combined – are currently responsible for two-thirds of coal demand: the dirtiest form of energy.

Both countries were heavily criticised last month for watering down coal pledges at the COP26 climate summit, altering the phrasing of agreed plans to cut coal consumption from “phase out” to “phase down” over the next two decades.

The energy agency argues there is a disconnect between the commitments made by both countries, and their continued reliance on coal energy. IEA’s latest annual coal report gloomily revealed that coal power generation has soared to worldwide record levels this year.

After falling over the past two calendar years amid a global push towards renewables and the volatility of the pandemic, global power generation from coal is expected to jump by nine percent in 2021 to a new peak of 10,350 terawatt-hours.

The rebound is being driven by this year’s rapid economic recovery in developed G20 nations, which has pushed up electricity demand much faster than low-carbon supplies can keep up with. Steep hikes in natural gas prices have also increased demand for coal power by making it more cost-competitive.  

Overall coal demand worldwide, including uses beyond power generation such as cement and steel production, is also forecast to grow by six percent in 2021. That increase will not take it above the record levels it reached in 2013 and 2014, but weather patterns and economic growth could boost coal demand to new peaks as soon as 2022 and remain at that level for the following two years, IEA said.

The IEA is once again pushing for government interventions, to limit global temperature rises to 1.5 degrees or less this century.

More than half of global coal-fired electricity generation takes place in China, where coal power is expected to grow by nine percent in 2021 despite a deceleration at the end of the year.

In India, it is forecast to grow by 12 per cent.

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