Coal is a crucial part of the energy mix and whether the world is ready to quit coal is still yet to be seen. Developing Asian nations such as India have breathed life into the medium-term future of the Australian coal industry over the next twenty years. Despite the United Nations calling for an end to fossil fuels, hundreds of new coal-fired power stations are still being built, and hundreds more are in the pipeline. Is the World Ready to Quit Coal? According to the World Coal Association these are some of the reasons why the world is not ready to quit coal:

  • Coal is the world’s largest single source of electricity and will still contribute 22% in 2040, remaining the biggest contributor.
  • 70% of the world’s steel production relies on coal. It’s the backbone of both the steel and cement industries.
  • Coal can be clean. Just by upgrading current coal plants to the best available technology, we can cut 2 Gigatonnes of CO2 emissions.
  • Coal also supports renewables which cannot deliver flexibility and stability by itself.
  • Every country has the right to flexible sources of clean energy at short notice, providing the stability and reliability we want when we need it. 

In this article, Global Road Technology assesses the dynamics of whether the world is read to quit coal and this is a follow up of our previous industry article on the ease of replacing coal.  

Australia’s longtime ‘love affair’ with coal

Australia is in a longtime ‘love affair’ with coal. Australia is the world’s largest exporter of coal with about 500, 000 million tonnes per annum and $49 billion in value. The country produces substantially more coal than it consumes. Mining has helped drive Australia’s economy for decades, and coal remains the country’s second biggest export. Before the Glasgow COP26 summit, Australian prime minister Scott Morrison produced a plan that did not commit to a stronger 2030 target, and rejected phasing out coal, oil or gas. His plan relied on projected technologies that had not yet been developed. The Global Methane Pledge seeks to cut methane emissions to 30% by 2030, however, this was not endorsed by Australia. This stance tends to benefit the underground Australian coal industry which constantly battles fugitive methane emissions from its operations especially in high gas regions such as the Illawarra in New South Wales. In Australia, coal is primary used as a fuel to generate electricity and it is used to produce about 80% of the nation’s electricity requirements. 

The Asian connection with coal

India’s government-controlled Coal India produces more coal than Australia’s entire exports by itself. China is the world’s largest miner and consumer of coal. Its production is more than seven times that of Australia at about 3.7 billion tonners per annum. Coal has helped China produce low cost manufactured goods because of relative cheapness and abundance. Developing Asian nations are interested to take up new technologies such as carbon capture utilization and storage which enables them to meet their need for power while also ensuring they help combat emissions. China, which has been a major financer of coal projects in other nations, announced in September it is halting the practice. Whether that is to be followed through entirely is still to be seen. According to the IEA, Asian development is still fueled by coal. The region is expected to become a key driver of world energy trends over the next 20 years. Millions of people in Southeast Asia have gained access to electricity since 2000, and the region is on the way of achieving universal access by 2030. Data compiled by the UN-backed Sustainable Energy for All (SEforALL) shows that the region has the third highest number of coal power plants in the pipeline after China and India. Indonesia, Vietnam and the Philippines have the largest coal plant pipeline of all South East Asian countries, with Malaysia and Thailand not far behind. 


Is the world ready to quit coal?

The transition towards cleaner energy has made progress but not quick enough to quit coal to limit global warming. ASEAN Centre for Energy and the World Coal Association found ASEAN countries will require approximately 234 gigawatts of additional coal capacity by 2040 to meet growing energy demand, however, with modest investment in clean coal technologies there is capacity to significantly cut emissions. Analysis from the Clean Coal Technology in ASEAN report indicates that US$8.7 billion investment would incentivize the coal industry to deploy ultra-supercritical technologies such as high efficiency low emission, carbon capture utilization and storage and pollution control technology. The Glasgow Financial Alliance for Net-Zero has US$130 trillion in funds under management, which is prepared to help in achieving the Paris temperature goals. The global economic recovery means that coal demand is likely to surpass its 2019 level and thus also become the leading source of greenhouse gas emissions. 

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Emerging difficulties

The world is taking the challenge of reducing carbon emissions seriously, however, it should not disadvantage newly industrialized nations that need low-cost energy from coal to keep their economies running. In mid-2020 some 44 countries and 31 cities accounting for 60% of global economic output had carbon pricing schemes in place based on research from the I4CE think tank. Carbon prices aim to make polluters pay for some of the social costs of emissions such as health care costs due to poor air quality and crop damage due to climate change. The disparity between current prices and experts projected price per tonne of CO2 is shocking. The price is under $10 for 75% of covered emissions and yet experts recommend between $40 and $80 to push polluters to increase efficiency or shift to renewable sources of energy. Investment in renewable energy has been taking a nosedive for several years in emerging and developing nations and the pandemic has done nothing much to change the situation. These countries hold two thirds of the world’s population and are responsible for 90% of the growth in emissions, but they are receiving only 20% of investments into clean energy based on the IEA findings. 


There is always a disconnect between words and actions. The gap is the largest when it comes to coal: countries are currently planning to produce 150% more coal in 2030 and despite more than two decades of climate policy making, fossil fuel production levels are higher than ever. To answer the initial questions posed, Is the world ready to quit coal? NO! Governments continue to support coal more than accelerating the move towards renewables, the coal ‘habit’ is here to stay. 

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