In its Coal 2023 report, published on Friday, the International Energy Agency predicted that the demand for coal globally is about to reach a historic high this year.
The organization forecasts that by the end of 2023, the global demand for coal will rise 1.4%, exceeding 8.5 billion tons for the first time in history, mostly due to the skyr0cketing demand for the fuel in emerging and developing nations. As an example, in China and India, it is forecast that consumption will increase by 5% and 8% respectively, mostly driven by an increasing demand produced by insufficient hydropower output.
The report notes that production of coal is also hitting record highs this year, as China, India, and Indonesia, which together as the three largest producers in the world, produce 70% of the global supply of the fuel, are expected to bring yearly output to over 2.5 billion tons. The agency also forecasts that strong growth in Asia will drive the global trade in coal to record highs.
However the report notes that beginning next year, it is expected that the use of coal may begin to fall, especially within developed nations. There, the growing energy production by renewable energy projects, especially in China, which consumes about half of the global consumption of coal each year, will begin to erode the use of coal globally. The IEA predicts that by 2026 global coal demand will fall by 2.3% compared to 2023 levels.
The IEA forecasted that compared to previous periods, the this time the shift in the use of coal will be more significant and long lasting.
Keisuke Sadamori, the IEA Director of Energy Markets and Security, said, “We have seen declines in global coal demand a few times, but they were brief and caused by extraordinary events such as the collapse of the Soviet Union or the Covid-19 crisis. This time appears different, as the decline is more structural, driven by the formidable and sustained expansion of clean energy technologies.”
He said that although there is still much work to be done to meet international climate targets, “a turning point for coal is clearly on the horizon.”
