Full Title: Coal Medium-Term Market Report 2016 - Market Analysis and Forecasts to 2021
Author(s): International Energy Agency
Publication Date: December 1, 2016
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Global coal demand growth has stalled. Coal demand in 2016 will be below 2013 levels, confirming a new trajectory since the meagre growth in 2014 after more than a decade of 4% annual growth. In 2015, global coal consumption decreased for the first time in this century. The big decline in the People’s Republic of China (hereafter “China”) and the United States was not offset by growth in India, Indonesia, the Russian Federation and Viet Nam. In China, coal use declined in the major consuming sectors: electricity, steel and cement. Coal generation dropped, driven by a sluggish 0.5% electricity demand growth and the diversification policy, which led to hydro, nuclear, wind, solar and natural gas power generation growth. In the United States, coal power generation plummeted as a result of low natural gas prices and coal plant retirements pushed by Mercury and Air Toxics Standards (MATS); hence, coal consumption dropped by 15%, the largest annual decline ever, to levels not seen in more than 30 years.
The world is burning more coal than ever. Except for the 1920s and the 1990s, coal use in the world has been continuously increasing since the start of the Industrial Revolution. Now we are witnessing another halt, but, even so, if we consider coal consumption from a historical perspective, the world has never burned as much coal. Our forecast shows a slight increase after a few years of decrease, reaching 2014 levels only in 2021. Such a growth path would depend greatly on the Chinese trajectory. Given the growth in primary energy globally, this means that, according to our forecast, 2011 was the “peak” for coal’s share in the energy mix in this century. Thus, whereas coal will continue to be the preferred source of power generation, the share will decline from over 41% in 2013 to around 36% in 2021.