Despite global efforts to slash carbon emissions, global coal-fired power generation is expected to rise 9% and hit a record by the end of 2021 as electricity demand from the economic recovery outstrips a shift to cleaner energy sources, the International Energy Agency said Friday.
The main drivers of the growth are China and India, which together account for roughly two thirds of the world’s coal use. Coal power is expected to notch increases of 9% in China and 12% in India to reach all-time highs in both countries by the end of the year, as electricity demand among the world’s two largest populations continues to grow.
Through 2024, coal-fired power generation will increase 4.1% in China and 11% in India, the Paris-based watchdog forecast in an annual report on coal use.
“Coal is the single largest source of global carbon emissions, and this year’s historically high level of coal power generation is a worrying sign of how far off track the world is in its efforts to put emissions into decline towards net zero,” IEA Executive Director Fatih Birol said.
In November, more than 190 countries reached a deal at the United Nations climate summit in Glasgow that aims to accelerate cuts in greenhouse-gas emissions and to “phase down” coal use for the future.
The IEA said the global rebound in coal was caused by a faster-than-expected economic recovery, temperature and weather fluctuations that dampened electricity supply and boosted demand. Supply issues have rapidly pushed up gas prices, raising demand for coal as an alternative for generating electricity.
China’s coal numbers were mainly driven by soaring industrial demand in late 2020 and early 2021, as construction and heavy industry led the recovery, followed by a decline of power demand in the latter part of the year due to a coal crunch as well as contractions in the property sector.
Still, China’s coal consumption is expected to increase 4% to 4,130 million metric tons in 2021—surpassing the record set in 2013. The IEA predicts China will expand its renewable energy capacity by around 9.5% on average each year until 2024, but that is unlikely to cover additional power demand, expected to expand by nearly 4% a year until 2024, meaning coal use will likely continue to grow. In April, Chinese President Xi Jinping announced that his country would begin reducing coal consumption starting in 2026.
“The rebound shows that clean energy growth globally needs to accelerate further to realize coal phase-down fast enough to meet goals set in Glasgow,” said Lauri Myllyvirta, lead analyst at the Center for Research on Energy and Clean Air.
Meanwhile, nonpower coal use in China is set to fall further as the country continues its efforts to reduce coal consumption for residential heating and small industries, the IEA said.
India is facing a similar dilemma to China, with energy demands projected to rise rapidly as the country of nearly 1.4 billion gets wealthier and its economy expands, not all of which can be met by an increase of renewable energy in the short term.
Last month in Glasgow, Prime Minister Narendra Modi pledged India would aim to triple its solar-power capacity and meet half of its energy requirements with renewable energy by 2030. Still, the IEA forecasts that India’s coal consumption will grow at around 4% each year through 2024.
Although the global energy crunch this fall has prompted countries to expand coal production and consumption in the short term, it could also push Beijing and Delhi to accelerate the shift toward renewables in the long-term, some energy analysts say.
In the past, solar and wind energy were often considered unreliable and unstable sources of power generation, but the shock from soaring prices and the havoc caused by supply bottlenecks has also exposed vulnerabilities from relying on coal, said Michael Davidson, a professor at the University of California, San Diego, who focuses on emerging electricity markets.
“China and India may rethink the link between energy security and coal,” Mr. Davidson said.
Coal demand world-wide is set to grow 6% this year, which won’t take it above the record levels reached in 2013 and 2014. The IEA, however, forecasts that demand will reach an all-time high in 2022 and then plateau over the following two years. Increases in coal demand in Asia will be offset by falling demand in the U.S. and the European Union by 2024, the watchdog said.
Coal-fired power generation surged by around 20% in the U.S. and the European Union following steep, pandemic-related declines in 2020. Coal use in both markets is expected to resume falling through 2024 due to a slowdown in electricity demand growth and the expansion of renewable energy, the IEA said.
“When you leave out China, the rest of the world is already cutting coal use. India’s peak will accelerate this. Once China peaks, a global peak is a given,” the Center for Research on Energy and Clean Air’s Mr. Myllyvirta said.
—Phred Dvorak contributed to this article.
Write to Sha Hua at sha.hua@wsj.com
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