The International Energy Agency (IEA) released its latest report titled ‘Coal 2024: Analysis and Forecast to 2027’, projecting a new record for global coal demand in 2024, which is expected to remain high through 2027.

Key Findings of the Report

Record Coal Demand in 2024:

• Global demand for coal is poised to rise to 8.77 billion tonnes, a record high.
• Demand is likely to stay close to this level through 2027 as renewable energy gains traction and China’s coal consumption stabilizes.

Rising Demand in Emerging Economies:

• Countries like India, Indonesia, and Vietnam are experiencing rising coal demand due to sharp increases in electricity consumption driven by economic growth.
• Despite production growth, demand is expected to flatten beyond 2024 due to structural changes in the energy landscape.

Record Coal Trade and Production:

• Global coal trade is projected to hit a record 1.55 billion tonnes in 2024.
• The top producers – China, India, and Indonesia – reached record outputs in 2024.

India’s Role in Coal Dynamics:

• India’s coal demand is expected to grow by over 5%, reaching 1.3 billion tonnes, a level previously achieved only by China.
• India’s coal production target for FY26 is set at 1,193.39 million tonnes, marking a 10.5% increase from FY25 targets.
• Despite domestic production pushes, imports have remained steady due to strong demand.

China’s Dominance in Coal Consumption: China consumes 30% more coal than the rest of the world combined, accounting for over 56% of global demand in 2023.

Reasons for Persistent Coal Usage

• Economic Growth and Rising Power Needs: Coal remains a key energy source for power generation, industrial activities, and infrastructure development, supporting economic growth.
• Weather-Driven Energy Fluctuations: Renewable energy sources like wind and solar are weather-dependent. Coal provides a reliable and affordable backup during fluctuations.
• Electrification of New Sectors: Emerging industries, such as data centers and AI, and sectors like mobility and industrial heat are driving up electricity demand, bolstering coal usage.
• Profitability for Exporters: Exporters like Indonesia and Australia have benefited from surging profits, particularly after the COVID-19 pandemic and the 2022 energy crisis.