2023-12-15 06:00:00
Is the planet about to begin its withdrawal from coal, the fossil energy emitting the most CO2, but also the most used for the production of electricity in the world? In any case, this is what the latest edition of the annual report of the International Energy Agency (IEA) on the coal market suggests, published this Friday, September 15, two days after the consensus reached at the COP28 of Dubai calling for the first time in the history of these climate conferences for a transition towards the end of fossil fuels. Also for the first time, the IEA anticipates a structural decline in global demand, with a slight decline from 2024 to 2026. The expected decline in global demand “could mark a historic turning point”, thus estimates the agency.
According to the report, global demand for coal will first reach 8.5 billion tonnes in 2023, a record, although the increase is only 1.6% compared to 2022. It is then expected to decrease by 2 .3% by 2026. And this, “even if governments do not announce and implement stricter clean energy and climate policies”specifies the report, for which this inflection point is essentially due to “the strong expansion of renewable energy capacities which will be brought into service during the three years preceding 2026”.
The decisive role of China
« We have seen declines in global coal demand a few times, but they have been brief and resulted from extraordinary events such as the collapse of the Soviet Union or the Covid-19 crisis. This time looks different, because the decline is more structural and driven by the tremendous and sustained expansion of clean energy technologies.”rejoices Keisuke Sadamori, director of energy markets and security at the IEA, in a press release.
China plays a key role in this development. While currently the country alone accounts for more than half of global coal demand (54%), it will also host more than half of the deployment of new global renewable energy capacity over the next three years. The IEA also expects strong hydroelectric production in 2024. As a result, Chinese demand for coal is expected to decline from 2024 and decrease by 4.3% by 2026, compared to 2023.
Climate: India’s worrying addiction to coal
India will become the main driver
On the other hand, demand for coal in India, the second largest consumer in the world, will continue to increase. The subcontinent will thus become “ the main driver of growth in global coal demand “, notes the report, which expects annual growth of 3.5% until 2026, after an increase of 8% in 2023. Within three years, India’s annual consumption should reach 1.4 billion tons.
This excitement is not surprising. While 73% of India’s electricity mix currently depends on coal (compared to 61% in China), the authorities are putting the brakes on reducing its use. In fact, slowing down its use would endanger its insolent growth, while the country still has 800 million poor people.
Conversely, demand for coal is expected to continue to decline in most developed countries. According to IEA forecasts, the United States and the European Union should even record a record respective decline of around 20% in 2023.
Caution for after 2026
Will the decline in global coal demand continue beyond 2026? The report, whose scope of study is limited to the period 2022-2026, does not say this. Nevertheless, the agency remains very cautious, particularly regarding the evolution of demand in China, which will be strongly influenced in the years to come by four major factors: the pace of economic growth, that of the deployment of clean energies, the conditions weather and structural changes in its economy.
« A turning point for coal is clearly on the horizon, although the pace at which renewable energy grows in major Asian economies will dictate what happens next and much greater efforts are still needed to meet international climate goals. », met ainsi en garde Keisuke Sadamori.
The rate of decline remains insufficient for the climate
And for good reason, the anticipated global decline looks very timid and should result in a form of plateau over the next three years. Global consumption should therefore remain well above 8 billion tonnes until 2026. However, to reduce emissions at a rate compatible with the objectives of the Paris agreement, the use of coal must decrease much more quickly, recalls the IEA.
Unfortunately, on this point, the COP28 agreement, which ended on Wednesday in Dubai, is disappointing. It only endorses the objective “to accelerate efforts towards a gradual reduction of electricity produced from coal” not associated with carbon capture and storage techniques, without setting a precise timetable. No progress since COP26 in Glasgow…
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