IEA: Coal expected to rebound in 2021, future of coal will be decided in Asia
(eceee news, 22 Dec 2020) Global coal demand is forecast to rise by 2.6% in 2021, after recent drop, according to Coal 2020, the latest edition of the IEA’s annual market report on the sector. The rebound in global coal demand is set to be short-lived, but no immediate decline in sight.
A global economic recovery in 2021 is expected to drive a short-lived rebound in coal demand after the major drop this year triggered by the Covid-19 crisis, according to the report. There is little sign that the world’s coal consumption is set to decline substantially in the coming years. Rising demand in some Asian economies offset declines in other parts of the world. Coal is by far the single largest source of global energy-related carbon emissions, and the trends outlined in the report pose a major challenge to efforts to mitigate these emissions.
During the past two years there has been historic falls in global coal demand, led by unprecedented drops in the United States and Europe, according to the report. Latest estimates from the IEA suggest coal demand will have plunged by a further 5% in 2020 on the economic fallout from Covid-19.
The report forecasts a 2.6% rise in global coal demand in 2021, driven by higher electricity demand and industrial output. China, India and Southeast Asian economies account for most of the growth. The United States and Europe may also see their first increases in coal consumption in nearly a decade.
The rebound in coal demand in 2021 is set to be short-lived, with coal use forecast to flatten out by 2025 at around 7.4 billion tonnes, the report shows. This would make 2013, when global coal demand reached 8 billion tonnes, coal’s all-time peak. However, coal use in absolute terms is not set for a rapid decline in the immediate future, IEA says.
According to the report, the future of coal will largely be decided in Asia. Today, China and India account for 65% of global coal demand. If Japan, Korea, Taiwan and Southeast Asia are included, that share rises to 75%. China will be especially influential. The country currently accounts for half of the world’s coal consumption.
View the IEA press release here
View the report here