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Global coal consumption will rise to an all-time high in 2022 and remain at similar levels for several years in the absence of stronger efforts to accelerate the transition to clean energy, a report by the International Energy Agency (IEA) showed Friday.
The IEA expects global coal use to rise by 1.2 percent in 2022, surpassing 8 billion tonnes in a single year for the first time and eclipsing the previous record set in 2013.
The spike in gas prices and subsequent supply disruptions after the Russia-Ukraine conflict led some countries to switch to cheaper coal. Heat waves and dry weather in some regions, as well as insufficient hydro and nuclear power supplies, particularly in France, where reactors have been shut down for repairs, have also pushed up demand, the IEA’s latest annual market report showed.
While high gas prices have forced European coal demand higher this year, the IEA expects it to fall below 2022 levels by 2025. At the same time, it forecasts that global coal consumption will remain at similar levels until 2025, as the robust demand in emerging Asia will offset declines in developed economies.
“The world is close to a peak in fossil fuel use, with coal set to be the first to decline, but we are not there yet,” said Keisuke Sadamori, the IEA’s director of energy markets and security.
Coal production will peak next year and fall below 2022 levels by 2025, the agency said. By 2025, the IEA estimates annual coal production will fall to 8.221 billion tonnes, below 2022 levels. The lower levels largely reflect expectations that China’s coal production will plateau in the coming years, and the continuing growth in India’s coal production will be offset by significant declines in other regions, such as the U.S. and the EU.
All three of the world’s largest coal producers are expected to set output records this year. However, despite elevated prices and high-profit margins for coal producers, there is no sign of a significant increase in investment in export-driven coal projects. The IEA said this reflected caution among investors and mining companies about coal’s medium- and long-term prospects.
