Worldwide Coal Consumption Grows

Despite efforts to reduce coal consumption across the globe to slow climate change, the International Energy Agency reported global coal consumption is on the rise, up 1 percent in 2018. Coal is used primarily to produce electricity and while the U.S., EU, and other large economies are reducing their use of coal for electricity, developing countries are increasing their use of coal in electricity production.

According to data from Enerdata, the U.S has reduced its share of electricity produced from coal to 31 percent in 2017, 15 percentage points less than 2000. Likewise, the EU has reduced coal’s share in electricity production to 21 percent, and China has reduced its share to 68 percent, down 10 percent. In contrast, countries like Indonesia, Turkey, and India are increasing the share of coal in their electricity mix.

There are several reasons (political; resource endowment; natural disaster; etc.) which help explain the divergence of the use of coal, but another contributing factor is the attractiveness of coal economically and politically. Coal is often a cheaper fuel source for many developing countries. It is found in abundance and is relatively easy to transport. Moreover, a greater reliance on coal can reduce price volatility, an important consideration for political leaders in developing countries. Political leaders want a growing economy, a rising middle class, and economic stability. They also aspire to join the club of developed countries. Using coal to produce electricity can help achieve these goals.