Global demand for the world’s most controversial energy source, coal, dropped by 15 per cent this year in the industry’s largest-ever annual decline, according to the latest analysis released Monday by the International Energy Agency.
In Coal: Medium-term market report for 2016, the IEA said coal demand was likely lower this year than it was in 2013, continuing a path of declining consumption after it fell in 2015 for the first time this century. “While this has happened before, most recently in the 1990s, it is a notable change from the 4 per cent annual growth seen over 2000 to 2013,” the IEA said. “Yet it is too early to say that coal is dead.”
Weaker demand in the U.S. and China, the engines of the global economy, is not being offset by increasing demand in emerging economies such as India, Indonesia and Vietnam.
Coal production decreased for the second year in a row as its use is rapidly declining in Western nations as stronger climate policies, such as the Paris Climate Agreement, carbon pricing regimes are implemented and alternative energy becomes more affordable.
Canada’s federal government announced in November that it plans to phase-out coal altogether by 2030. “In this environment – defined by the United States and Western Europe – new coal power plants are rare and the existing aging fleet is steadily disappearing,” it said.
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