Daily Current Affairs : 21-December-2023
The International Energy Agency (IEA) predicts a significant downturn in global coal demand by 2026, indicating a monumental shift towards renewable energy and heightened nuclear generation in key regions.
Key Highlights of the Coal Market Report:
- Global coal demand reached a record high in 2022, soaring by 4% to 8.42 billion tonnes.
- Asia, led by China, India, and Indonesia, is the primary driver of this demand surge.
- The United States experiences a decline in demand, while Europe exhibits restrained growth.
Anticipated Decline in Coal Demand:
- Advanced economies are expected to witness a decline in coal demand in 2023.
- Global coal consumption is projected to be 2.3% lower in 2026 compared to 2023.
- China, India, and Indonesia are anticipated to set records in coal output in 2023.
Factors Influencing Decline:
- A notable shift towards renewable energy contributes to the decreasing demand for coal.
- Global climate changes impact hydropower output.
- Significant growth in low-cost solar photovoltaic deployment.
- Moderate increases in nuclear generation in China, India, and the European Union.
Regional Outlook:
- China’s coal consumption is expected to decline in 2024, with an increased reliance on renewables.
- Uncertainty in China’s economic growth and coal use due to structural changes.
- India, Indonesia, and emerging economies are likely to persist in relying on coal for economic growth.
Climate Targets and Coal Use:
- Efforts to reduce unabated coal use are crucial for meeting international climate targets.
- The goal of a nearly 95% reduction in coal emissions between 2020-2050 aligns with COP28 commitments.
Coal Prices and Industry Dynamics:
- An unexpected surge in coal prices impacts consumers and the industry.
- Mining companies maintain robust profit margins despite rising costs.
- Diversified mining firms strategically reinvest coal profits in anticipation of energy transition demand.
International Energy Agency (IEA):
- Established in 1974 as an autonomous agency by OECD member countries.
- Headquarters located in Paris, France, in response to the mid-1970s oil crisis.
- Primarily focuses on energy policies, addressing economic development, energy security, and environmental protection.
- Plays a crucial role in providing information on the international oil market and takes action against disruptions in oil supply.
- Membership includes 31 member countries and 13 association countries, with candidates required to be OECD member countries, including India.
Important Points:
Global Coal Demand Trends:
- Record-high global coal demand in 2022, rising by 4% to 8.42 billion tonnes.
- Asia, led by China, India, and Indonesia, is the primary driver of demand growth.
- Notable demand declines in the United States, with Europe showing restrained growth.
Anticipated Decline in Coal Demand:
- Expected decline in most advanced economies’ coal demand in 2023.
- Global coal consumption projected to be 2.3% lower in 2026 than in 2023.
- China, India, and Indonesia expected to break coal output records in 2023.
Factors Influencing Decline:
- Shift towards renewable energy contributing to the decline in coal demand.
- Changes in global climate affecting hydropower output.
- Significant growth in low-cost solar photovoltaic deployment.
- Moderate increases in nuclear generation in China, India, and the European Union.
Regional Outlook:
- China’s coal consumption expected to fall in 2024, with increased reliance on renewables.
- Uncertainty in China’s economic growth and coal use due to structural changes.
- India, Indonesia, and emerging economies likely to continue relying on coal for economic growth.
Climate Targets and Coal Use:
- Efforts to reduce unabated coal use crucial for meeting international climate targets.
- Goal of nearly 95% reduction in coal emissions between 2020-2050, aligning with COP28 commitments.
Coal Prices and Industry Dynamics:
- Unexpected surge in coal prices impacting consumers and industry.
- Mining companies maintaining strong profit margins despite rising costs.
- Diversified mining firms strategically reinvesting coal profits in anticipation of energy transition demand.
International Energy Agency (IEA):
- Established in 1974 as an autonomous agency by OECD member countries.
- Headquarters located in Paris, France, in response to the mid-1970s oil crisis.
- Primarily focuses on energy policies, addressing economic development, energy security, and environmental protection.
- Plays a crucial role in providing information on the international oil market and takes action against disruptions in oil supply.
- Membership includes 31 member countries and 13 association countries, with candidates required to be OECD member countries, including India.
Why In News
The International Energy Agency (IEA) projects a substantial decline in global coal demand by 2026, attributing this shift to the expansion of renewable energy and increased nuclear generation in key regions. As nations increasingly prioritize sustainable alternatives, the IEA anticipates a transformative trajectory towards a cleaner and more resilient global energy landscape.
MCQs about Transformations in the Global Coal Market
-
What is the primary driver of global coal demand growth in 2022?
A. Europe
B. United States
C. Asia (China, India, Indonesia)
D. Africa
-
Which factor is NOT mentioned as contributing to the decline in global coal demand?
A. Shift towards renewable energy
B. Changes in global climate affecting hydropower output
C. Significant growth in nuclear generation
D. Expansion of coal mining operations
-
Which region is expected to see a decline in coal consumption in 2024, with an increased reliance on renewables?
A. Europe
B. North America
C. Asia (China)
D. Africa
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