{"id":75493,"date":"2022-09-29T14:30:27","date_gmt":"2022-09-29T04:30:27","guid":{"rendered":"https:\/\/www.aspistrategist.ru\/?p=75493"},"modified":"2022-09-29T14:01:40","modified_gmt":"2022-09-29T04:01:40","slug":"the-worlds-appetite-for-coal-was-increasing-even-before-the-ukraine-war","status":"publish","type":"post","link":"https:\/\/www.aspistrategist.ru\/the-worlds-appetite-for-coal-was-increasing-even-before-the-ukraine-war\/","title":{"rendered":"The world\u2019s appetite for coal was increasing even before the Ukraine war"},"content":{"rendered":"
<\/figure>\n

Coal accounted for half the growth in global power generation last year, and further increases are likely this year as European nations restart mothballed coal-fired power stations.<\/p>\n

For the first time since 2013, the increase in demand for coal-fired power last year exceeded the growth in renewables.<\/p>\n

The growth in demand for coal is detailed in two reports issued last week by the International Energy Agency<\/a> and the consultancy BloombergNEF<\/a>.<\/p>\n

Half the countries that pledged at last November\u2019s United Nations COP26 climate conference in Glasgow to phase out coal generation have in fact increased it.<\/p>\n

The goal of achieving net-zero emissions by 2050 agreed at the COP26 climate summit last year assumed that unabated coal-fired power generation would fall by an average of 11% a year through to 2030 and would be completely phased out by 2040.<\/p>\n

Instead, the increase in coal-fired power last year was 8.5%. Taking last year as an exception, the trend of the previous three years showed a small decline of less than 2% a year, though that was entirely obliterated by last year\u2019s surge. It suggests that the political commitments to curb carbon emissions made at Glasgow are out of kilter with economic reality.<\/p>\n

The growth in demand for coal-fired power has been driven by the speed of global economic recovery from Covid-19, the depletion of hydro-electric power by droughts across the northern hemisphere and soaring gas prices.<\/p>\n

The world\u2019s three biggest coal users each boosted their output: China\u2019s coal-fired power rose by 9%, India\u2019s by 16% and the United States\u2019 by 14%.<\/p>\n

In China and India, coal-fired generation remains the default option for baseload power. In the US, recently approved climate legislation has yet to shift the renewed emphasis on coal under Donald Trump\u2019s administration.<\/p>\n

Coal use grew because it could: coal-fired generators were operating at below their maximum capacity and had the ability to respond to unexpected growth in demand.<\/p>\n

The reports show that construction of new coal-fired generators is overwhelmingly concentrated in the emerging world, led by China, India and Vietnam. In both advanced and emerging nations, there is greater investment in new renewable power sources than in fossil fuels.<\/p>\n

In the advanced nations, a net 21 gigawatts of coal-fired generating capacity was retired in 2021 (roughly equivalent to Australia\u2019s current coal generating capacity). In the emerging world, by contrast, a net 34 GW of new coal-fired power was added. The construction of new plants in the emerging world has slowed sharply: last year\u2019s build was the lowest on record and down from 43 GW in 2020 and 61 GW in 2019.<\/p>\n

The Ukraine war has forced a shift in the advanced world this year. Germany is bringing 7.2 GW of retired coal-fired capacity back on line to ensure continued power amid cuts to its gas supply from Russia. France and the Netherlands have both relaxed limits on coal use, while the United Kingdom, Italy, Austria and Greece are discussing or have already approved delays to phasing out coal-fired power and are temporarily reopening idled plants.<\/p>\n

Wind and solar have received the lion\u2019s share of fresh investment in the power sector, with a rise from 30% to 75% over the past decade. The share of fossil fuels globally shrank from 55% to 14% in the same period.<\/p>\n

However, coal remains the biggest single source of electricity, accounting for 35% of global generation last year; fossil fuels, also including gas, oil and diesel, accounted for 61%. The major emerging economies remain heavily dependent on coal, which supplies 74% of power in India, 62% in both China and Indonesia, 86% in South Africa and 60% in the Philippines.<\/p>\n

Despite the massive investment in renewables, which the International Energy Agency expects to reach US$472 billion this year, solar and wind still only account for 11% of global generation. Hydro-electricity is a further 16%, while nuclear is about 10%. Solar and wind power have a much higher share of total installed capacity\u2014around 25%\u2014but their use depends on weather.<\/p>\n

Globally, the problem is that demand for electricity has been growing rapidly. Total generating capacity has almost doubled in the past 15 years, but investment in baseload power has failed to keep up, resulting in shortages and astronomic prices.<\/p>\n

This has been made much worse by the Ukraine war and the sanctions on Russia, which previously provided 25% of the global gas trade, 18% of thermal coal exports, and 8% of oil.<\/p>\n

Since the invasion, the thermal coal price has risen from US$170 a tonne to an average of close to US$350 a tonne as buyers tussle for available supplies.<\/p>\n

Australian producers, which are the world\u2019s biggest coal exporters, have had had no difficulty in replacing the Chinese market after Beijing imposed embargoes on Australia (before the ban, China took about 20% of Australia\u2019s coal exports). Last year, Japan increased its coal purchases from Australia by 15%, India by a massive 38% and Korea by 33%.<\/p>\n

However, Australia\u2019s ability to do more is heavily constrained. Financial institutions will not support new coal projects, particularly for thermal coal. Coal projects for steelmaking may still be able to gain finance, though that is far from certain. Coal companies\u2019 main option is to expand existing mines through their own cash flows.<\/p>\n

The Labor government is expected to take a tougher stance on new coal project approvals than its predecessor, although both the New South Wales and Queensland governments have a strong incentive, in the form of coal royalties, to authorise expansions.<\/p>\n

Prime Minister Anthony Albanese has said that coal mines that \u2018stacked up\u2019 environmentally could be approved and that Labor would welcome the jobs that would flow. He has rejected calls from the Greens to join the 40 nations who pledged at COP26 to phase out coal. However, Environment Minister Tanya Plibersek blocked a Clive Palmer-owner large open-cut coal project near Rockhampton in Queensland because of concerns it could affect the Great Barrier Reef.<\/p>\n","protected":false},"excerpt":{"rendered":"

Coal accounted for half the growth in global power generation last year, and further increases are likely this year as European nations restart mothballed coal-fired power stations. 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