Coal Transitions: Research and Dialogue on the Future of Coal
Coal represents 28% of global energy consumption. However, meeting commitments under the Paris Agreement on climate change requires a coal phase-out across the globe. In many coal-dependent countries, this raises significant political, social and economic issues.
Coal Transitions is an international research project led by Climate Strategies and IDDRI which aims to develop credible and feasible trajectories and policy guidance for deep transitions in the coal sector in six major coal using countries: China, India, Australia, South Africa, Germany and Poland.
In the context of this project, several case studies of major coal-consuming economies have been carried out. The overarching conclusion is that implementing Paris Agreement-compatible pathways away from coal is feasible in the major coal-using economies within 20 to 30 years, and would be beneficial both from a social and from an economic point of view.
The different case studies show that major coal-using economies can virtually phase out coal without significantly raising power costs for consumers. At the same time, there are economic and social benefits to gain from a transition into new industries. Furthermore, it has become clear that the peak and decline of global thermal coal is approaching faster than previously shown: Coal demand could go into reverse before 2025.
In their very own interest, countries should develop coal transition strategies now, as the underlying economics and societal preferences are turning against coal. Major exporting countries, such as Australia and South Africa, appear to be under-prepared for the coming downturn in global coal demand. And if we look at China, for example, even a 5–10% decline in domestic use of thermal coal could wipe out up to a third of the global seaborne market for coal and could consequently depress the price of coal on the international market. However, to make this clear, this decline would not be sufficient to meet the Paris Agreement.
The complete country reports as well as further publications of this project can be downloaded from the project website: https://coaltransitions.org/reports/
This piece is part of the Just Transition(s) Online Forum. Views expressed are those of the authors and do not necessarily represent those of the JTRC or its partner organizations.
