Coal consumption is expanding after two years of decline, but miners should brace for another period of sluggish growth, according to the International Energy Agency.
In its latest annual report, the IEA forecasts global coal demand will remain essentially stable over the next five years, inching up by just over 1 percent between 2017 and 2023. The reason for coal’s stagnation remains unchanged from recent years: Developed nations are ditching the fossil fuel, while India and other emerging economies are turning to coal to quickly scale up electric power generation.
“In a growing number of countries, the elimination of coal-fired generation is a key climate policy goal. In others, coal remains the preferred source of electricity and is seen as abundant and affordable,” said the IEA, a Paris-based agency that advises developed nations on energy policy, according to CNBC.
The IEA’s forecast comes on the heels of a series of reports that the world is falling short of commitments to prevent catastrophic impacts from climate change and running out of time to take action. Burning coal for electric power and industrial purposes such as steelmaking is a major contributor to global warming.
“Fossil fuels are going to be with us for a long time,” IEA Executive Director Fatih Birol said in the report. “That is why the only way to tackle our long-term climate goals and address the urgent health impacts of air pollution, while also ensuring that more people around the world have access to energy, will require an approach that integrates strong policies with innovative technologies.”
In 2023, the IEA sees the world consuming just over 5.4 billion tons of coal equivalent. At that level, coal would provide 25 percent of the world’s energy, down from 27 percent today. The agency sees cheap, cleaner-burning natural gas and renewable energy sources continuing to eat into coal’s share of the global energy mix.