This follows a record peak in coal demand which occurred over the course of 2023. However, the IEA’s latest report on the annual coal market has, for the first time, predicted a drop in global coal consumption to 2026.
Coal 2023 highlights a 1.4 per cent rise in demand for coal in 2023, equating to 8.5 billion tonnes. However, the report follows this with a predicted fall in global coal demand b7 2.3 per cent by 2026 compared to 2023 levels. Several factors will have contributed to this, including record declines in demand for coal across many advanced economies in 2023, including the EU and the US, where focus has shifted to renewable energy sources.
Although many advanced economies are experiencing a fall in demand for fossil fuel sources such as coal, demand in emerging and developing economies who are more reliant on fossil fuel energy sources is high and on the rise, with demand increasing 8 per cent in India and 5 per cent in China in 2023.
Coal is currently the largest global energy source for electricity generation, steelmaking and cement production while also being one of the greatest emitters of CO2 from human activity. Mitigating the negative climate impacts of its use is essential for staying within global climate targets outlined by the Paris Agreement, but investment into alternative, greener energy sources is needed to accommodate this.
Recently, the COP28 negotiations agreed upon a “transition away” from fossil fuels and “tripling the capacity” of renewable energy by 2030, two key elements of the COP text which will stimulate further falls in demand for coal as clean energy sources become more and more accessible.
The IEA has seen declines in coal demand before, for example during the coronavirus pandemic, but this marks the first sustained decline driven by evolving global policy and attitudes rather than arbitrary global phenomena.
“A turning point for coal is clearly on the horizon,” explains Keisuke Sadamori, IEA Director of Energy Markets and Security. “Though the pace at which renewables expand in key Asian economies will dictate what happens next, and much greater efforts are needed to meet international climate targets.”
21 November 2024
19 November 2024
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