Cheap shale gas is significantly reducing coal demand in the United States, but global coal consumption is still expected to rise 2.6 percent annually by 2017, the International Energy Agency said today in a report.
Coal consumption will climb to 4.32 billion tons of oil equivalent by 2017, nearly matching oil consumption of about 4.4 billion, the Paris-based agency said in its first Medium-Term Coal Market Report.
"Coal's share of the global energy mix continues to grow each year, and if no changes are made to current policies, coal will catch oil within a decade," said Maria van der Hoeven, IEA's executive director.
Demand for coal rose 4.3 percent last year, with China accounting for 67 percent of the increase and replacing Japan as the largest importer, the report says. Coal demand and carbon dioxide emissions from coal will continue to increase unless climate change policies are introduced, the IEA said.
Countries outside the Organisation for Economic Co-operation and Development are expected to drive growth with an annual increase of 3.9 percent. Within the OECD, coal use will drop by 0.7 percent a year, led by a 2.5 percent drop in U.S. demand per year to 600 million metric tons in 2017, the IEA said.
"Coal demand never stropped growing in the financial crisis and despite aggressive climate policies in many places," van der Hoeven said in a teleconference with journalists. "The only significant decline in coal consumption globally was in the United States, and the reason is cheap gas."
Total world consumption of coal will be 6.17 billion tons in 2017, up from 5.28 billion last year, the report forecasts.
"The impact of the coal-to-gas switch in North America is so significant that for the first time since China's rise, the medium-term growth rate in coal consumption will fall below the growth rate of gas," van der Hoeven said.
The world will burn around 1.2 billion more tons of coal per year by 2017 compared to today, equivalent to the current coal consumption of Russia and the United States combined. China will account for 70 percent of the growth in coal demand over the next five years, while India will make up 22 percent, the report says.
"India becomes the second-largest coal consumer and the largest coal importer in the world," van der Hoeven said. "Together, by 2017, China and India represent more than one-third of global coal imports and two-thirds of global coal demand. It's clear that the Chinese and Indian coal market decisions will have an impact on our electricity bills."There are times when I wish I was wrong...but I predicted this stuff almost six years ago. The exception is that I did not see the US demand for coal sliding because of natural gas. However, as I point out in my post, it won't matter if the US or Europe drop their carbon output...China and India will more than make up for it. And since neither of those countries are willing to bind themselves and say that the West (ahem, developed countries) must bear the burden of CO2 reduction.
India's coal demand will increase by 6.3 percent per year to 643 million tons by 2017, IEA said. Australia will become the world's largest coal exporter by 2017, shipping 356 million tons of coal equivalent, the report says.
So, Global Warming Is Inevitable.
We have only one atmosphere, folks.