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Developing world using more coal, offsetting cuts elsewhere

SZCZECIN, POLAND - 2018/02/06: Smog comes out of chimneys from the Power station in Dolna Odra, Szczecin.
Smog comes out of chimneys from the coal power station in Dolna Odra, Szczecin, Poland. Photo: Omar Marques/SOPA Images/LightRocket via Getty Images

A decrease in coal consumption in the developed world will be matched by an increase in the developing world, according to major energy outlooks. Between 2015 and 2040, the Energy Information Administration predicts a 90% increase in coal demand in India and 80% in other countries in non-OECD Asia. Africa, the Middle East and South America are also expected to expand coal capacity.

The big picture: As the world experiences one of the hottest summers on record, and despite increasing recognition of the negative effects that greenhouse gases have on earth’s climate, the projected consumption of coal — the most CO2-intensive fossil fuel — is staying surprisingly strong.

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Much of coal’s continuing popularity stems from its developmental advantages: Relative to other fossil fuels, coal is widely available, cheap to extract and resistant to wild price fluctuations, which makes it a crucial resource for the developing world’s burgeoning populations struggling to eradicate poverty and grow their economies. For some countries, domestic availability also insures them against supply fluctuations and potential geopolitical pressure from dominant supplier countries.

As a result, coal still holds appeal in some countries over the alternatives:

  1. Natural gas deposits are generally concentrated and its supply and prices can fluctuate widely, especially during winter or as a result of geopolitical pressure.
  2. Nuclear power is expensive to build and, because of safety concerns, socially fraught. It also presents the potential trap for poorer nations of becoming dependent on other countries for technology and resource knowledge.
  3. Renewable wind or solar make good domestic power sources, but they still face the issue of intermittency, and are not yet ready to sufficiently support industry and large-scale economic growth

What's next: Developing giants such as China and India but also countries such as Turkey and Poland continue to bank on coal. In fact, Poland plans to use coal for 50% of its power generation into 2050. And given China's proposed tariffs on U.S. natural gas, as well as growing concerns in Central and Eastern Europe about Russian dominance over natural gas markets, this trend may even accelerate.

Anna Mikulska is nonresident fellow in energy studies at the Baker Institute's Center for Energy Studies and a senior fellow at the University of Pennsylvania's Kleinman Center for Energy Policy.

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