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Global coal trade to grow through 2050, driven by Asia and industrial coal use: EIA

The global coal trade is projected to continue growing through 2050, largely driven by Asia, as industrial coal use increase and the power generation market in Asia grows, the Energy Information Administration said in its International Energy Outlook 2019 released Tuesday.

“In most regions, coal production and consumption are projected to remain near current levels with long-term growth expected in India and non-OECD [Organization of Economic Cooperation and Development] Asia,” the report said.

Global coal production is expected to hold steady at 8 billion st through 2040, while consumption will be over 9 billion st, driven by India and other non-OECD Asian countries. By 2050, the global coal trade is projected to grow at an average rate of 1.4% per year, to 2.2 billion st. Until the 2030s, the report said, coal usage is projected to decline as regions replace coal with gas and renewables in power generation due to cost and government policy. However, the report said that “in the 2040s, coal use increases as a result of rising industrial usage and rising use in electric power generation in non-OECD Asia excluding China.” While coal-fired generation will stay stable through to 2050, its share will decline from 35% in 2018 to 22% in 2050 as total generation increases.

INDIA COAL PRODUCTION TO RISE

India is projected to increase its annual coal production by 2.7% per year, to 2 billion st in 2050 from 850 million st in 2018, in order to meet growing domestic demand. Consumption will grow by an average 3.1% per year, to 2.9 billion st in 2050 from 1.1 billion st in 2018. Additionally, India is expected to be the world’s largest importer by 2050, with imports growing on average 4.1% per year.

“Sustained industrial growth and significant efforts to further electrify the country’s rural areas are expected to continue to drive India’s coal consumption growth,” the report said. Largely, India will lead industrial coal use in non-OECD Asia after the mid-2020s due to “growth in coal-intensive industries and relatively low coal prices,” it added. In the Indian power sector, coal consumption will increase 2.5% per year; however “it is outpaced by renewables consumption, which grows by 8.1% per year” through 2050, the report added.

Between 2018 and 2050, India will have an average 4.6% growth in electricity demand, largely met by renewable generation and “leading to a large decrease in the coal’s share of the generation mix.”
“Although coal-fired generation more than double throughput the projection period, the share of electricity generation from coal falls from 73% in 2018 to 38% in 2050,” the report said.

CHINA CONSUMPTION EXPECTED TO DROP

China is expected to consume 3.5 billion st per year by 2050, with the country’s consumption having peaked in 2013 with 4.7 billion st. Overall, Chinese imports will remain flat, although other non-OECD imports are expected to increase by 1.8% per year.
Coal-fired generation in China will peak in 2025, but “slowing demand growth and the goal of limiting CO2 emissions growth by 2030” will halt coal generation, the report said. By 2050, coal’s share of power generation will have dropped to 30%, compared with 64% in 2018.

https://www.spglobal.com/platts/en/market-insights/videos/market-movers-asia/092319-saudi-attacks-us-china-trade-talks

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