CGTN Europe speaks to Lauri Myllyvirta, senior fellow at Asia Society Policy Institute and lead analyst at the Centre for Research on Energy and Clean Air.
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00:00Global coal use has rebounded after plummeting at the height of the pandemic.
00:05The International Energy Agency, which predicts that global coal use, says it'll rise to 8.77 billion tons this year.
00:14And it's set to plateau until 2027 as more power is generated from renewable energy sources
00:21and coal consumption in China starts to level off.
00:25China is particularly important for global coal markets.
00:29One in every three tons of coal consumed worldwide is burned at a power plant in China
00:35as it continues to try to diversify its power sector.
00:39This report highlights advanced economies banning coal completely,
00:43but says demand for coal is increasing in emerging economies
00:47and coal prices are now 50% higher than the average cost between 2017 and 2019.
00:55Well, Laurie Mulliverta is from the Center for Research on Energy and Clean Air
01:00and a senior fellow at Asia Society Policy Institute.
01:03Laurie, this is pretty depressing reading, isn't it?
01:07It is for sure, especially the fact that the protection for the next years was revised up.
01:16We thought last year, the International Energy Agency thought last year
01:20that we could expect a falling trend in global coal demand over the next three years.
01:26Now, it turns out that the best case scenario looks like more of a plateau
01:31because of faster energy consumption growth.
01:36I mean, the reality is even sort of looking ahead to 2027,
01:40given the massive demand from things like data centers, cloud computing, artificial intelligence software,
01:47I mean, it really is naive, isn't it, to suggest that coal use is going to plateau anytime soon?
01:56A plateau is what we're looking at at the moment.
02:00The projections for energy demand have gone up,
02:04but the deployment of clean energy sources has also gone up very impressively over the past year or so.
02:12So now it looks very finely balanced.
02:15The IEA central scenario is for a very slow increase in coal consumption,
02:23but if you look at the uncertainty, it could just as well come down.
02:26And the main swing factor is how fast does China deploy clean energy
02:31and does China's abnormally fast electricity consumption growth normalize over the next years?
02:39The truth is stuff happens in these projections, doesn't it?
02:42Things like the Ukraine crisis change the demand on coal and suddenly it spikes hugely.
02:49All you need is another global upset like that.
02:54But that's certainly true.
02:56This is a projection, but it's a projection that captures what the structural factors are at the moment.
03:04And that's why it's still significant.
03:09But so far, the International Energy Agency has very consistently underestimated clean energy growth.
03:16And that's the main factor that could in fact make things look brighter
03:24if clean energy growth continues to accelerate in China and elsewhere.
03:29The big thing about the global economy at the moment is that in many parts of the world it's struggling.
03:34There isn't huge amounts of money for national governments to do
03:38what some might say is the right thing.
03:41And that makes infrastructure investment difficult, doesn't it?
03:46That is true when you're talking about things that governments need to spend money on.
03:53The thing about clean energy, especially solar, also wind,
03:59is that it's profitable at the current electricity prices just about everywhere.
04:06So the only thing that the governments need to do is get out of the way, speed up permitting.
04:11It makes it easier to build these things.
04:14And for most countries, that will be enough.
04:18The exception is very low income developing countries where capital is expensive.
04:24And that's where public financing from the rest of the world is needed to make it happen.
04:29Laurie, good to see you. Thank you for that.
04:31Laurie Mulliverta from the Centre for Research on Energy and Clean Energy.