A report by the International Energy Agency (IEA) has predicted that global coal consumption is set to rise to an all-time high in 2022 and remain at similar levels in the next few years if stronger efforts are not made to move to a low-carbon economy.

According to the IEA Report, high gas prices following Russia’s invasion of Ukraine and consequent disruptions to supply have led some countries to turn to relatively cheaper coal this year. Meanwhile, heatwaves and droughts in some regions have also driven up electricity demand and reduced hydropower, while nuclear generation has also been very weak, especially in Europe, where France has to shut down nuclear reactors for maintenance.

The IEA’s annual report on coal forecasts that global coal use is set to rise by 1.2% this year, exceeding 8 billion tonnes in a single year for the first time and a previous record set in 2013. It also predicts that coal consumption will remain flat at that level until 2025 as falls in mature markets are offset by continuous strong demand in emerging Asian economies.

The report explained that this means coal will continue to be the global energy system’s largest single source of carbon dioxide emissions by far. The largest increase in coal demand is expected to be in India at 7%, followed by the European Union at 6% and China at 0.4%. “The world is close to a peak in fossil fuel use, with coal set to be the first to decline, but we are not there yet,” said Keisuke Sadamori, the IEA’s Director of Energy Markets and Security.

Europe’s Coal Demand Rises

Europe’s coal demand has risen due to more switching from gas to coal due to high gas prices and as Russian gas has reduced to a trickle. However, by 2025 European coal demand is expected to decline below 2022 levels, the report said.

Global coal-fired power generation is set to rise to a new record of around 10.3 terawatt-hours this year, while coal production is forecast to rise by 5.4% to around 8.3 billion tonnes, also an all-time high. production is expected to reach a peak next year but by 2025 should fall below 2022 levels.

The three largest coal producers, China, India, and Indonesia, will all hit production records this year but despite high prices and comfortable margins for coal producers, there is no sign of surging investment in export-driven coal projects, the report added.

The report noted that this reflects caution among investors and mining companies about the medium- and longer-term prospects for coal.

In 2021, coal consumption worldwide came to around 160.1 exajoules, up from roughly 151.1 exajoules in the previous year. During the period, consumption of coal across the globe increased by some 65.2 exajoules, peaking at 162.6 exajoules in 2014.