Expansion of renewables will lead to a decline of twenty-eight percent in the EU power sector’s CO2 emissions by 2025 and in fossil fuel-fired generation from 2023
The International Energy Agency
In 2022, the energy crisis prompted by Russia’s invasion of Ukraine and a reliance on fossil fuels has shaken the markets altering the coal trade, supply and demand patterns, and price levels.
The demand has risen in some European regions due to the increase in fossil fuel prices. Still, it has been counterbalanced by renewables and energy efficiency, higher coal prices, and the state of the global economy. The contraposition of these factors has resulted in a mitigation of the coal demand increase for the past year and stable projections for the upcoming ones.
According to the International Energy Agency (IEA)’s latest market report on the coal sector, while global coal use was set to increase by 1.2 percent in 2022, exceeding the 2013 record.
This rise in demand happened at a time of global crises and has meant a surge in profit for coal companies, like the Swiss multinational mining company Glencore whose profits have hit thirty-four billion US dollars in 2022, according to its 2022 preliminary results report.
«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», explained the IEA’s Director of Energy Markets and Security Keisuke Sadamori in a statement. «Coal demand is stubborn and will likely reach an all-time high this year, pushing up global emissions. At the same time, there are many signs that today’s crisis is accelerating the deployment of renewables, energy efficiency and heat pumps – and this will moderate coal demand in the coming years. Government policies will be key to ensuring a secure and sustainable path forward».
The history of coal
Coal is a solid fossil fuel and a combustible black or brownish-black sedimentary rock. Coalification is the process that turns buried dead plant matter into peat and coal via intense heat and pressure over geologic time. Coal is extracted from the so-called coal beds via mining and then burned for fuel.
While the recorded use of coal dates way back in both China and Europe, the employment of this solid fossil fuel as an energy source has been widespread since the Industrial revolution when in 1709, the British ironmaster Abraham Darby figured out how to smelt iron ore using coke. The use of coal was a trademark of the era when fossil fuel was employed to power steam locomotives, themselves a symbol of this time.
Today, coal is the global chief energy source for electricity generation and cement, iron, and steel production.
What’s wrong with coal? – About the environmental impact
Given the process that generates it, coal is a non-renewable energy source. Coal combustion for energy production creates carbon dioxide (CO2) emissions, and coal is the largest source of this type of greenhouse gas emissions. Glasgow Climate Pact calls upon the parties to accelerate their efforts towards the phasedown of unabated coal power.
According to a report by the Berlin-based non-profit organization Climate Analytics the coal phase-out requirements to meet the objectives of the Paris Agreement are all coal-fired power stations shutting down by 2040 at the latest, global coal emissions reaching their peak in 2020, global coal use in electricity generation decreasing by 2030 by eighty percent below 2010 levels, and OECD countries ending coal use in full by the same year.
Coal use in Europe – the consequences of Russia’s invasion of Ukraine
Coal production has declined in the European Union (EU) in the past three decades.
According to data shared by Eurostat, in 2021, hard coal production in the European Union amounted to fifty-seven million tonnes, which is seventy-nine percent less than the 277 million tonnes produced in the EU in 1990.
In the three years between 2018 to 2021, the European Union reduced its use of coal by a fourth in both its hard and brown forms. In 1990, six EU state members, Poland, Germany, Czechia, Spain, and France, were responsible for ninety-eight percent of the total EU production. In 2021, Poland produced ninety-six percent of EU coal, while Czechia produced four percent.
Some countries in the EU have been temporarily switching to coal because of the high prices of natural gas and low hydropower generation. In Italy, in the first nine months of 2022, coal-fired electricity generation rose by eighty-two percent compared to the same period in the previous year.
Switching to coal because of the high prices of natural gas
On January 12, 2023, Bulgaria’s lawmakers voted to roll back plans to phase out coal-fired power plants, which generate over forty-five percent of the south-eastern European country’s electricity. This move happened after 1,500 miners and utility workers protested in support of the coal industry, an event that highlighted the importance of a fair phase-out that doesn’t leave workers behind.
The city of Warsaw is heading in this direction by endorsing the Fossil Fuel-non-proliferation treaty, which calls for an equitable phase-out of fossil fuels, including coal. This choice is significant as Warsaw is the capital of Poland. In this country, eighty-five percent of the total energy supply is generated through fossil fuels, with coal providing for the bulk of it, making the Polish energy sector’s carbon intensity the second-highest among the International Energy Agency (IEA) country members.
Coal use in Asia – the world’s largest coal consumer
China and India are the world’s largest coal consumers and its chief producers and importers. These countries rely on coal for electricity generation, while gas accounts for a fraction of power generation. Coal made up over sixty-two percent of China’s power generation in 2022. In India, coal-fired generation met the growth in power demand caused by the extreme heatwaves the area experienced in 2022.
The IEA has found that in 2022, fifty-seven percent of the Asia Pacific region’s electricity was generated by coal. The same year, this area was hit by extreme weather events and high gas prices. This convergence of events prompted a rise in coal use in electricity generation, which grew by two-point five percent compared to the previous year. According to the agency, this rise appears to be temporary as they predict that coal power will fall to fifty-two in the electricity mix in 2025.
The future of coal use
The IEA expects coal demand to plateau around the 2022 level of 8 billion metric tons through 2025, but the energy crisis, fuel prices, policies, and weather conditions could influence that. In addition, in spite of the profits made by coal producers, investments in coal mining haven’t boomed, according to IEA’s analysis.
According to the agency’s Electricity Market Report 2023, the expansion of renewable energy sources will lead to a decline of twenty-eight percent in the EU power sector’s CO2 emissions by 2025 and in fossil fuel-fired generation from 2023. In China, the growth in renewable energy sources will mirror that of coal. At the same time, the agency expects that in 2025 coal’s share in the Indian generation mix will decrease to sixty-nine percent.
«The world’s growing demand for electricity is set to accelerate, adding more than double Japan’s current electricity consumption over the next three years», Fatih Birol, the IEA’s Executive Director said in a statement. «The good news is that renewables and nuclear power are growing quickly enough to meet almost all this additional appetite, suggesting we are close to a tipping point for power sector emissions. Governments now need to enable low-emissions sources to grow even faster and drive down emissions so that the world can ensure secure electricity supplies while reaching climate goals».
The International Energy Agency (IEA)
The autonomous intergovernmental organisation providing policy recommendations. It was established in 1974, and it is based in Paris, France.
