World coal consumption falls at record pace in history

Posted June 15, 2017

World coal production had its biggest drop ever past year, 230 million tons of oil equivalent (mtoe), BP reported Tuesday in its 2017 Statistical Review of World Energy.

BP, the British oil and gas giant, said global efforts to slash greenhouse gas emissions and boost efficiency are having a tangible effect on global energy markets, with two main narratives playing out: the decline of coal, and the rapid rise of wind and solar power.

As China continues to look for ways to power its economic growth, it has also began to turn the page on coal and began exploring renewable energy sources.

This was most profound in China, which became the world's largest single producer of renewable power a year ago, overtaking the USA, while the Asia Pacific overtook Europe and Eurasia to become the largest producing region.

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"The fortunes of coal appear to have taken a decisive break from the past", writes Spencer Dale, BP's chief economist.

Trump's bet against this global structural trend is literally tilting at windmills. China, which accounted for about half of the coal burned in the world, used 1.6 percent less of the fuel, compared with an average 3.7 percent annual expansion in the 11 preceding years.

In Asia, China's decline was partially offset by higher consumption in India and Indonesia, where the fuel is still so cheap and readily available that utilities prefer it over natural gas for electricity generation.

Global coal consumption fell by 53 million tonnes of oil equivalent (mtoe), or 1.7 per cent. Australia was part of this decline, albeit at a minor scale compared with other countries.

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The annual report found that renewables were the fastest growing energy source in 2016, accounting for nearly a third of the increase, despite having a share of just 4%.

World coal production fell by a record 6.2 per cent, while in the United Kingdom coal consumption more than halved. China is thought to be leading this shift worldwide, individually the United Kingdom is certainly at the forefront as it saw an incredible 52.5 percent crash in the burning of coal.

The combination of weak energy demand growth and the shifting fuel mix meant that global carbon emissions are estimated to have grown by only 0.1% - making 2016 the third consecutive year of flat or falling emissions.

2016 was the third consecutive year which saw subdued growth in carbon emissions.

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The world consumed 1.6% more oil in 2016, with India's use rising 7.8%, or 325K bbl/day, and China's use adding 3.3%, according to the report. Growth was below average in all global regions except in Europe & Eurasia, and all fuels except oil and nuclear power grew at below-average rates. Global oil output rose at its slowest pace since 2009, at 0.5 percent, as production outside of OPEC dropped by the most in 25 years.