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China To Ban Coal Use In Beijing By 2020

China's decision to ban the use of coal from Beijing and other major cities by 2020 grabbed headlines this week, but experts are saying it is unlikely to have a significant impact on the country's coal consumption.

Despite the nation increasing efforts to curb air pollution, demand for the fossil fuel in China is expected to stay steady, as the country's population and economy expand.

Coal-fired power and heating is a major generator of greenhouse gases and, according to data from the US Energy Administration (EIA), it has helped turning the Asian giant into the world's largest emitter of carbon and other heat-trapping gases.

Coal production
Source: EIA, 2014.

According to official Xinhua News agency, coal accounted for 25% of Beijing's energy consumption in 2012 and 22% of the fine particles floating in the city's air. Motor vehicles, industrial production and general dust also contributed to pollution in the city of 21 million people.

Game changers

Reports claim the smog-plagued city will instead rely on electricity and natural gas for heating, cooking and other uses.

Growth in China's overall energy use is slowing anyway, with the broader economy. At the speed at which alternative sources are stealing coal's share, it is possible for Chinese coal demand to start falling soon.

The theory is supported by recent research from ratings agency Standard & Poor’s. Last month it published a report saying that Chinese demand for coal is likely to peak in six years.

Shale gas could be a “game changer” the agency said, but significant pipeline infrastructure needs to be installed before the country’s reserves can be fully exploited.

Coal companies in Europe are likely to be hit hardest, with the report dismissing any short-term impacts on coal mining in Indonesia, Vietnam, and Australia.

By. Cecilia Jamasmie of Mining.com


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