Global coal consumption is set to peak in 2024, rising to 8.77 billion metric tons as global electricity demand outpaces the increase in renewable energy.
Despite its role in global warming, coal remains the focus of energy systems around the world, and short-term consumption will increase.
“Coal is often considered a fossil fuel of the past, but its global consumption has doubled over the past three decades,” International Energy Agency (IEA) said in its latest report, it is revising the demand for coal to be high.
This increase is mainly driven by demand from countries such as India and Indonesia, which offsets the decline in coal consumption by developed economies such as the United States and the European Union.
China plays an important role in this trend, accounting for more than a third of the world’s coal consumption, with its demand reaching 4.9 billion tons by 2024. Despite huge investments in renewable energy, coal-fired plants continue to generate about 60% of China’s electricity. .
Imports also set a record, reaching 542.7 million tons of coal in 2024, an increase of 14.4% over the previous year. Low international coal prices allowed China to stockpile supplies and keep domestic energy costs stable.
“China’s increase in coal imports to 2024 was supported by a drop in seabed coal prices, which fueled international tensions over China’s supply of many types of coal,” Toby Hassalllead coal analyst for LSEG, per Reuters.
He estimated that its coal consumption grew by about 1%, despite lower consumption in the cement and steel sectors due to the housing crisis.
China is making significant progress in diversifying its energy sources, as the IEA expects it to account for nearly 60% of the world’s renewable energy installed by 2030. However, these efforts were not enough to reduce coal consumption significantly.
The IEA analysis suggests that China will continue to set annual coal consumption records for at least a few more years.
The IEA predicts global coal demand will increase in 2027, although this stabilization will occur at much higher levels. However, these predictions should be taken with a grain of salt, as the agency has been rocking the poles on higher coal use for years.
Given the insatiable appetite for Chinese food as well Donald Trump’s secondly, it would not be surprising if consumption rises in the 2030s.
Range Global Coal ETF (NYSE:COAL) is down 4.47% year to date.
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