The world is racing towards a future powered by renewable energy, but a stubborn reality remains: coal is still a major player in meeting global electricity demand. While the push for cleaner energy sources is undeniable, the pace of electrification is outpacing the development of renewable infrastructure, creating a significant hurdle in phasing out coal.
This reality is underscored by a recent upward revision of coal consumption forecasts by the International Energy Agency (IEA). The IEA’s World Energy Outlook now predicts that coal demand in 2030 will be 6% higher than previously estimated, equivalent to the coal consumption of Japan, the world’s fourth-largest coal consumer.
The driving forces behind this persistent coal reliance are the burgeoning demands of electric vehicles, air conditioning, and data centers, particularly in emerging economies like China and India. These nations heavily rely on coal, accounting for 60% and 75% of their respective energy mixes.
While a complete phaseout of coal is eventually anticipated, the UK’s recent experience serves as a cautionary tale about the challenges of premature transitions. The nation’s decision to shut down its last coal power plant in October has led to a widening projected demand gap, requiring reliance on European electricity imports during peak demand periods.
However, a recent breakthrough in Australia offers a glimmer of hope for a more gradual and manageable coal transition. AGL, one of Australia’s largest energy companies, successfully implemented a two-shift operation at its Bayswater coal plant. This trial allowed the plant to operate flexibly, generating power during peak demand periods and scaling back when solar energy output is high.
If this approach gains traction, it could offer a less disruptive path to phasing out coal, easing the pressure on renewable infrastructure development and potentially lowering electricity costs. This flexible approach could be a key enabler in bridging the gap between our ambitious renewable energy goals and the realities of global energy demands.
