The energy transition is powered by — wait for it — coal: Javier Blas

Global electricity demand is surging, driven by electrification efforts such as electric vehicles and heat pumps. However, renewable energy isn't growing fast enough to meet this rising demand, leading to increased reliance on coal. Despite advances in clean energy, coal consumption is at record levels and is projected to remain high, especially in China and India. This highlights the uneven progress of the energy transition, with fossil fuels still dominant in the power sector..Sign up for your early morning brew of the BizNews Insider to keep you up to speed with the content that matters. The newsletter will land in your inbox at 5:30am weekdays. Register here..By Javier Blas .___STEADY_PAYWALL___.In what should be one of the least surprising developments, global electricity demand is soaring everywhere as the world moves to electrify everything. Out go gasoline cars, in come electric vehicles; out go gas boilers, in come heat pumps; and so on and so forth. That's the energy transition..There's a catch, however. As demand for power goes up faster than renewables can supply, the world is turning to a time-tested source to produce it: coal. .The result is twofold. First, the year when coal demand is expected to peak gets pushed further out. Second, what follows the peak now resembles more an elevated plateau that's getting higher and higher by the year. And if history is any guide, we should expect further revisions..One barely hears about this in glossy descriptions of the energy transition. Coal only gets mentioned when some country closes its last coal-fired power station. That was the message recently in the UK, which put an end to 142 years of coal-generated power when the country closed its last coal plant in late September in Ratcliffe-on-Soar, about 100 miles north of London. Meanwhile, Asia has been busy opening new ones. .The reality for the most polluting of all fossil fuels is record consumption and stronger-than-expected demand in the future. It's a sign of the uneven, fits-and-starts nature of the energy transition: Record solar generation and record coal demand can coexist..Read more: Rational perspective: Why SA must embrace nuclear, coal to power growth.Last week, the International Energy Agency published its annual World Energy Outlook, a comprehensive review of the likely paths that supply and demand for fossil fuels and renewable sources of energy would follow up to 2050. Buried in the 398-page report was a warning: "The outlook for coal has been revised upwards particularly for the coming decade, principally as a result of updated electricity demand projections, notably from China and India.".It wasn't a small revision: Coal consumption in 2030 is now estimated 6% higher than only a year ago. That may sound small, but it amounts to adding the equivalent of the consumption of Japan, the world's fourth-largest coal burner. By 2030, the IEA now believes coal consumption will remain higher than it was back in 2010..This was an important change in what was otherwise an upbeat report. Wind and solar continue to expand faster than many thought, including the IEA. As a result, they are increasingly growing their market share. "In energy history, we've witnessed the Age of Coal and the Age of Oil," IEA Executive Director Fatih Birol said. "We're now moving at speed into the Age of Electricity.".Birol, an economist who has gone from cheerleading the fossil fuel industry to rebranding himself as a green champion, is not wrong. Yet, he left a lot unsaid about that new electricity age. Around the world, over a third of those electrons come from burning coal. In China, that goes up to 60%; in India it rises to almost 75%..Coal is needed because power use is accelerating faster than what renewable sources can provide. It's also dependable: It doesn't rely on weather conditions like hydropower, wind and solar do. Other than coal, only nuclear power plants and gas-fired stations can provide electricity around the clock. One day, perhaps, solar and wind will be able to do so in combination with batteries. But for now, battery storage is short-lived and tiny when compared with the energy needs of even medium-sized cities..Read more: Eskom's $3.6bn plan: SA's battle against coal emissions.One notable statistic: Two-thirds of the total increase in energy demand in 2023 was met by fossil fuels, according to the IEA..Yes, clean power is the future. For now, however, fossil fuels remain the present — especially when electricity demand is accelerating this fast. Between 2023 and 2030, electricity consumption is expected to grow six times faster than total energy demand, compared with two times faster in the 2010-2023 period and 1.4 times faster in 2000-2010. According to the IEA, the equivalent of the electricity use of the world's 10 largest cities is being added to global demand each year..The acceleration isn't about artificial intelligence and data centers as is often lamented. If anything, they would account for a fraction of the increase in consumption. Demand for power is coming from everywhere, notably electric vehicles, air-conditioning and even water desalination..The epicenter of the electricity boom is Asia, so it makes sense that the world's two largest coal consumers, China and India, not only aren't abandoning coal, but are still building more coal-fired power stations. The result is an energy transition that is more polluting than many had hoped..Under former US climate envoy John Kerry, America reached a sort of détente with China about the energy transition. The unwritten deal involved China giving up coal over time. With hindsight, it feels like Beijing played Kerry, who was desperate for a deal at the COP26 climate summit in 2021 in Glasgow — the first gathering for the Biden administration, when the White House wanted to burnish its green credentials after Trump..It's time for a new approach. The world can't claim it's moving in the right direction until coal consumption has dropped meaningfully, say to the levels of 2000. On current trends, that's unlikely to happen until well beyond 2050. Policymakers should stop pretending as if the war against coal has been won. We're still far from it..Read also:.SA Energy Minister stresses longevity of coal dependencySouth Africa coal giants consider job cuts due to 'dire' Transnet rail woesWhat a free electricity market could look like in SA: Andrew Kenny.© 2024 Bloomberg L.P.

The energy transition is powered by — wait for it — coal: Javier Blas

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