Global coal usage has reached an all-time high in 2022 amid the disruption of traditional trade flows, soaring costs and increased demand, according to the International Energy Agency (IEA).
The IEA said in a report that worldwide coal usage is set to surpass 8 billion metric tons for the first time this year following the chaos of a global energy crisis. A metric ton is equivalent to 1,000 kilograms.
The report states that fossil fuel prices, particularly for natural gas, have substantially increased throughout the year, causing “a wave” of consumers switching fuels from gas. This has caused an increase in demand for fuel sources with more competitive prices, including coal in certain regions of the world.
The amount of coal used in producing electricity is expected to increase by roughly 2 percent compared to last year, according to the agency.
But the IEA noted that higher coal prices, the deployment of renewable energy sources and weakening global economic growth are limiting the overall increase in the demand for coal.
China accounts for just more than half of all coal consumption, according to the report, but its “prolonged and stringent” COVID-19 policy — known as the country’s “zero COVID” effort — has hurt economic activity and undermined the demand for coal.
The report states that Europe has been one of the hardest-hit regions by the global energy crisis due to its reliance on Russia for natural gas. Europe has previously imported roughly 40 percent of its natural gas from Russia, including through the Nord Stream 1 and Nord Stream 2 pipelines, but Russia has cut off most of Europe’s access as part of its attempt to deter European support for Ukraine amid the Russian invasion that began in February.
Some European countries have responded by increasing their generation of coal, accelerating their deployment of renewable energy and sometimes extending the lifespans of their nuclear power plants, the report says.
Some coal plants that had been shut down or left in reserve have reentered the market. In most countries, these plants only offered a limited amount of coal power capacity, but in Germany the reversal was of a “significant scale,” the IEA noted, boosting coal power generation within the European Union.
The IEA expects that increased efforts to improve energy efficiency and expand renewable energy sources will cause the EU’s coal generation and demand to drop as soon as 2024, however.
The report states that global coal demand will likely plateau from 2022 through 2025, but much of that outlook could rely on China, where coal consumption grew sharply in 2021 but is expected to grow only modestly in the next few years because of an increase in renewable power generation.
Coal use is projected to continue to drop in the United States and fall substantially in the EU by 2025.