Coal Use Falling, Proof of Progress to Low-Carbon Future

Although it is easy to get caught up in the vastness of the volume of fossil fuels we continue to consume, we are increasingly being presented with positives as we move - albeit slowly - along a path toward a lower carbon-emitting future. So here are a few hat-tips towards said precedents of progress from recent days…from China coal to California cool.

What first ignited this latest random walk was an article about how Chinese coal imports are cooling. As economic growth slows in China, it tag-teams with public anger over air pollution to put pressure on coal demand. The government is seeking to reduce the country's energy intensity - a.k.a. the amount of energy used per unit of economic output - with lower consumption being the low-hanging fruit of solutions. This is being reflected in the expectation for lower coal imports going forward (see at right).

Related article: China's Plan to Reduce Coal-Fired Electricity Disastrous for Global Climate

Nevertheless, China is not only the largest global producer of coal, but its coal consumption outweighs that of every other nation in the world…..combined. Quite a feat. All the while, the entire growth in incremental coal consumption for the past five years has come from China and India (India a little, China a lot - see below), while the rest of the world has seen coal demand peter off.

The vehemence in this pace of growth has led the IEA to project that coal consumption will challenge oil as the top global energy source by 2017. From this point, however, its reign will wane as an increasing emphasis is placed on other more clean-burning fuels.

And flipping to the other side of the coin, we are seeing signs of material growth coming through in renewable generation here in the US. According to the EIA, California saw a record 26% of its power generation met from renewable sources in May. So while we may still be seeing coal account for 40% of power generation on a national scale, there are some states making strides toward a more renewable future:

Related article: Endgame? New EPA Regulations Threaten U.S. Coal Industry

As for the breakout of the renewable generation on that record day, it is detailed below. A combination of factors have led to this bullishly green scenario: an aggressive state renewable portfolio standard, federal tax credits, grants, and a statewide cap-and-trade program have all played their parts, while mother nature also helped….it was a a particularly windy spring day:

en

So despite the rumors of the demise of King Coal being somewhat premature, there are signs of its weakening grip of power in the largest energy-consuming nations in the world. And just as we know all markets are interrelated, it should come as no surprise that US coal exports are expected to drop 8.5% versus last year…as Chinese imports cool. Something to keep an eye on as we approach peak coal in 2017.

By. Matt Smith