Coal demand can rise to an all-time high in 2022: IEA

A rebound in the global economy could propel coal demand to an all-time high in 2022, according to the International Energy Agency.

According to a report by the watchdog, coal-based electricity production has risen by 9 per cent this year as fossil fuel demand soared during the recovery from Covid lockdowns.

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The pandemic caused coal power to decrease by 4 per cent in 2020, but the IEA data shows that demand for electricity this year outpaced the growth of low-carbon sources, so many wealthy countries remain dependent on fossil fuels.

Global gas supply shortages, which have driven prices up worldwide to record levels, have affected coal demand as well, according to the IEA report.

Overall, global coal demand, including cement and steel production, rose by 6 per cent this year.

Even though the total is below the demand for fuel seen in 2013 and 2014, the IEA warned that without policy intervention, it could surpass those levels next year.

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IEA executive director Fatih Birol noted that coal is the single largest source of global carbon emissions and that this year's record coal power generation is an indication of how far off track the global effort to reduce carbon emissions has gone.

Unless governments act quickly to tackle coal emissions – in ways that are fair, affordable, and secure for those affected – we have little chance of limiting global warming to 1.5C, she added.

This report comes in the wake of the COP26 climate talks, which ended in a bitter disagreement over the pledge to abandon coal. After last-minute intervention from India, China the pact's language was changed from "phasing out" to "phasing down".

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Following the climate talks, COP26 president Alok Sharma said that India and China would have to explain themselves to poor nations after watering down the Glasgow agreement adding that he was deeply frustrated by their actions.

India's coal-fired electricity production is expected to increase by 12 per cent this year, according to the IEA report, while China's coal power is expected to grow by 9 per cent despite a recent slowdown. 

The IEA says this would be the highest level seen in either country, despite an impressive rollout of solar and wind power projects.