The world’s coal emissions are set to blow past climate targets in 2025, with Australia playing a key role in supply, finds a new report released this weekend by the International Energy Agency (IEA).
The Coal 2020 analysis details forecasts out to 2025, and finds that global coal demand will rebound slightly in 2021, but will remain essentially flat out to 2025. Increasing demand in Asian countries will offset structural declines in coal use in other parts of the world.
“As coal is by far the single largest source of global energy-related carbon emissions, the trends outlined in the report pose a major challenge to efforts to put those emissions on a path compatible with reaching climate and sustainable energy goals”, writes the IEA.
“We have [witnessed] the largest drop in coal consumption since the Second World War,” said said Keisuke Sadamori, the IEA’s Director of Energy Markets and Security, who also highlighted that “there is no sign that coal is going to fade away quickly”.
Though the IEA’s earlier ‘world energy outlook’ report found that “even under today’s policy settings, coal does not return to its pre-crisis trajectory”, this new report forecasts that the demand for coal in 2025, estimated to be around 7,500 megatonnes, is 18% higher than their previously stated “Sustainable Development Scenario”. This was pointed out on Twitter by Ember Climate analyst Dave Jones, who also highlights the IEA’s 1.5C “net zero” scenario shows coal use must be even lower in 2025, to adhere to global climate targets.
Today @IEA's annual coal report is out..
Well done: amazing info, free, accessible, readable👏
BUT: You don't say 2025 coal forecast is 18% above IEA SDS!?
We are in a #ClimateEmergency, if your forecast is right, we will burn! Where is the alarm📢🔔https://t.co/PWLA91RCQt
— Dave Jones (@CoalFreeDave) December 18, 2020
YES! So why is there ZERO mentions of CO2 in the coal report? And ZERO mentions that your 2025 coal forecast is 18% above your SDS scenario?
You need to ringing the alarm bells!
Here's your coal demand waterfall chart with the x-axis set to zero, and IEA SDS+NZE2050 added… pic.twitter.com/h0vegiwRNl
— Dave Jones (@CoalFreeDave) December 18, 2020
Australia will play a key role in carbon overshoot
The coal report does not explore how these predictions compare to the IEA’s previously stated climate scenarios, but does highlight the main sources of this global short-term trend: namely, mining of coal in Australia, Russia and South Africa. “In Australia, the most significant expansion is led by Bravus Mining and Resources (former Adani Mining), an Indian company, and investment plans include a 189 km railway line to connect their Carmichael mine with the existing rail network”, writes the IEA, in the section focused on coal mining projects.
“Australia leads in expanding export-oriented coal mining capacity”. The report even cites the NSW Minerals Council’s analysis touting the “economic benefits” of significant expansion of coal mining projects, and seems to express concern that the capacities of export terminals may not be able to match the massive increases in fossil fuel exports from these projects.
Of the projected categorised as ‘more advanced’ in the IEA’s dataset, Adani’s coal mine remains the largest by far, among the countries analysed. This project and several others in Australia mean that the IEA is predicting Australia will be one of the key drivers in the world failing to rapidly reduce global coal use, which will result in blowing past climate targets and creating significant new climate risks.
The report also splits out Australia’s role in these dangerous predictions of coal overshoot, between thermal coal (for generating electricity) and metallurgical (or ‘coking’) coal, used to manufacture steel (for which there are emerging but fewer alternatives, compared to electricity). “In the first-half of 2020 thermal coal production in Australia was sustained by high demand from China.
However, exports to China declined in the second-half of the year as import quotas tightened and customs clearance of Australian origin coal became more difficult”, write the IEA, in reference to China’s recent tightening of coal imports from Australia. However, they also place high expectations on the export of metallurgical coal from Australia, citing demand for steel manufacture in India and China.
The IEA’s ‘World Energy Outlook’ report, released earlier this year, predicts that total global demand for coal must decreased from around 3,500 million tonnes of oil equivalent to around 1,500 Mtoe, by the year 2030, for the world to be on track to achieve ‘net zero’ emissions by 2050. The generation of electrical power from coal must also see similar significant decrease, under this scenario.
The organisation has been criticised in the past for excluding ambitious climate action scenarios from its modelling, which has created licence for large fossil fuel companies to justify their plans to either maintain or expand their operations. The absence of comparison to clear climate targets, and the treatment of this coal forecast as ‘business as usual’ will likely be met with new criticism, in addition to being used by the world’s coal operators as a justification for their current modes of operation. “In 2020, China and Japan enhanced these ambitions by committing to net-zero targets. This doesn’t mean transitioning away from coal”, wrote the World Coal Association, in response the IEA’s new report on coal.
‘Coal 2020’ was developed with direct contributions from some of the world’s most significant coal companies and lobby groups. Some of the groups that “provided input” or “reviewed the draft” include Whitehaven coal, Glencore, the German Coal Association, the World Coal Association, the Minerals Council of Australia, Eurocoal and RWE. According to the report, Glencore has the second highest proposed coal mining capacity, both in the world and Australia only.
In 2019, Lauri Myllyvirta (lead analyst at the Centre for Research on Energy and Clean Air) predicted that the IEA’s estimate of coal demand in 2020 was significantly exaggerated. “The IEA’s coal-industry-sponsored annual report says global coal demand will jump above 2018 level in 2020 after falling in 2019, against downward trends that only steepened toward year-end. Anyone at the agency up for a bet? Drinks of your choice on me if 2020 demand > 2018”, he wrote in December 2019. Though the impacts of the pandemic were unforeseen, 2020’s coal demand has indeed ended up below 2018 levels.
As the IEA highlights Australia’s role in expanding coal extraction, the country continues to work to expand gas mining too. A new report released by Norwegian-based consultancy Rystad Energy found that Australia was fourth in the world in 2020 for the leasing of oil and gas exploration areas, and first in terms of the number of rounds of leasing that was held. However, the news also comes as the NSW Land and Environment court upholds a finding against a large new coal mine that it may not proceed on the grounds of the emissions caused when the product is burned overseas.
