New Coal Report Underscores the Urgent Need for Global Clean Energy Development

The latest International Energy Agency’s (IEA) Medium-Term Coal Market Report 2012 re-confirms the dangerous path the world is on--a path of increasing dependence on coal, which carries serious environmental risks for people and the planet. According to the report, the world will burn 1.2 billion metric tons more coal per year by 2017 compared to today, surpassing oil as the world’s top energy source.

Coal already contributes 40 percent of global greenhouse gas emissions--the IEA projects this figure to grow to 50 percent over the next 25 years. Greenhouse gas emissions--which again reached record levels this year--are driving global climate change, the impacts of which we’re already seeing through more extreme weather events, droughts, and rising sea levels.

To alter course and avoid the worst impacts of climate change, we need a new approach that’s grounded by stable long-term policies, investments, and innovation that leads to a global transition to clean energy. While it may seem that the road to greater coal production is inevitable, the reality is that we can avoid this pathway--if we start now.

The Growth of Coal in the Developing and Developed World

According to the IEA report, developing nations will largely drive future coal growth. China and India combined are expected to account for more than 90 percent of the increase in global coal use over the next five years (70 and 22 percent, respectively). According to the IEA analysis, even by assuming a relatively low-growth scenario for the Chinese economy, China will continue to account for half of global coal demand in the medium-term.

This data is consistent with WRI’s recent Global Coal Risk Assessment, which identified nearly 1,200 proposed coal-fired power plants across 59 countries—the majority of which are slated for development in China and India.

Coal’s increase, however, is not limited to the developing world. Europe’s coal consumption is projected to climb in the short-term. And while the IEA shows that the United States’ coal use is currently declining in the near-term (largely due to falling natural gas prices), the U.S. Energy Information Administration’s early release of the 2013 Annual Energy Outlook forecast an increase in the country’s coal use in the longer-term.

Coal’s Growth isn’t Inevitable

Of course, the continued reliance on coal is not inevitable, as some media reports suggest.

China, in particular, is already experiencing pressure to reduce its coal consumption. As I noted in a previous blog post, current conditions—such as the economic slowdown, stronger domestic climate and environmental regulations, and growing public concerns about health and environmental conditions–could slow the pace of China’s coal demand. Natural gas in China could potentially act as a viable bridge fuel as the country further develops its renewable energy. China, like other countries, has strong economic, energy security, and environmental reasons for pursuing the benefits of clean energy. After all, China led the world in clean energy investment at more than $54.4 billion in 2010. And, it has a target to increase renewable energy production to at least 11.4 percent of its electricity generation, with 21 Gigawatts of solar and 100 Gigawats of wind installed by 2015. China is also making progress on improving economic efficiency.

While all people have a right to reliable and low-cost energy, there are more sustainable choices. And the ongoing dependence on coal must be weighed against its long-term costs to public health and global warming. Ultimately, coal must be decoupled from the idea of economic development. Both developing and developed countries should enact policies and pursue energy options that don’t degrade air quality, pose health and environmental risks, and contribute significant amounts of greenhouse gas emissions.

The IEA report--like WRI’s recent coal analysis--offers troubling projections of an increasingly coal-dependent future. Energy producers need to decide--soon--if they are going to lock-into this course or opt for a lower-carbon future.