September 21, 2017 Read More →

Global Trends Indicate a Coal Comeback Is Unlikely

Financial Times:

President Donald Trump has pledged to “put our miners back to work” in the US, promising to return high-paying jobs to rundown rural areas of states such as Pennsylvania that brought him victory in last year’s election. Trends in coal markets, both in the US and internationally, suggest that will be an uphill battle.

In 2013, the US Energy Information Administration projected that world coal demand would rise 39 per cent by 2040. Now it is expecting growth of just 1 per cent. If not quite “Peak Coal”, it certainly looks like an extended plateau. Projections of energy demand even a few years into the future can never be relied on: there are too many uncertainties in how markets and technology will evolve, and the EIA itself makes clear that this scenario is just one among many possible outcomes. Even so, the latest projection, from the EIA International Energy Outlook 2017, published last week, shows that the promise of eternally rising world demand for coal, which was the consensus expectation just a few years ago, can no longer be taken for granted.

China dominates world coal markets, accounting for more than half of total global demand. The EIA believes that Chinese coal consumption may now be on a declining trend, with industrial use for steam and steelmaking already having peaked, and demand for power generation likely to peak around 2023. With demand also in long-term decline in the US and in Europe, growth in some emerging economies, led by India, is not enough to raise total coal use overall.

More: ($) The future of coal in seven charts

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