Peak China coal update

China’s coal consumption fell in 2014.

Some cheering news to start the year with. Remember my announcement in August of peak Chinese coal?  Premature, you thought, on the basis of a Greenpeace Asia blog and a garbled translation from an unknown Chinese business information company?

Well, the year is over and here is the reputable-looking Cleveland-based Institute for Energy Economics and Financial Analysis weighing in. An IEEFA report states, according to  Platts:

In 2014, coal demand actually declined by 2.1%.

The IEEFA have a reputation to lose, unlike me, so they cautiously predict that China’s coal demand “will permanently peak by 2016, if not earlier.” I see no reason not to take the drop at face value. GDP growth was 7.3%, on trend. Chinese coal burning has peaked.

Of course, to save the climate it still has to drop, and by a lot. But this is still very, very good news.

In November I was puzzled why the Chinese government only promised Obama a CO2 target it will easily meet with no change in policy, allowing for a large increase in coal-burning it won’t need. A hypothesis I didn’t think of then is that China can now very easily announce stronger goals in its national offer for the Paris climate talks. The USA’s side of the bilateral deal is already at the limit of what can be achieved by executive action. So China will look good, and deflect criticism from the most vulnerable countries to the USA as laggard.

Attention will also shift to India, whose plans for a massive increase in coal-burning will isolate it. My (Pollyannish?) prediction here is that Modi will realize that Coal India’s promises are worthless and scale back the coal plans. He’s bet his political future anyway on solar energy and might as well be hanged for a sheep as for a lamb.

PS on the bad news front: I’ve nothing to add to Ezra Klein on the atrocious crime in Paris to silence Charlie Hebdo. I rarely looked at it while I lived in France - crude and fiery anticlericalism is a taste I never acquired. But as I shall be in France next week, I plan to buy a copy of their special 1-million print run edition. The usual circulation is 45,000. I hope they sell every copy. Feel free to comment here on this.

Author: James Wimberley

James Wimberley (b. 1946, an Englishman raised in the Channel Islands. three adult children) is a former career international bureaucrat with the Council of Europe in Strasbourg. His main achievements there were the Lisbon Convention on recognition of qualifications and the Kosovo law on school education. He retired in 2006 to a little white house in Andalucia, His first wife Patricia Morris died in 2009 after a long illness. He remarried in 2011. to the former Brazilian TV actress Lu Mendonça. The cat overlords are now three. I suppose I've been invited to join real scholars on the list because my skills, acquired in a decade of technical assistance work in eastern Europe, include being able to ask faux-naïf questions like the exotic Persians and Chinese of eighteenth-century philosophical fiction. So I'm quite comfortable in the role of country-cousin blogger with a European perspective. The other specialised skill I learnt was making toasts with a moral in the course of drunken Caucasian banquets. I'm open to expenses-paid offers to retell Noah the great Armenian and Columbus, the orange, and university reform in Georgia. James Wimberley's occasional publications on the web

2 thoughts on “Peak China coal update”

  1. Modi seems to be going ahead with provoking a fight to actually make Coal India competent, so we'll see. He could probably get a no less potent version of that reform just by allowing Indian utilities to buy and set up their own power sources (including solar), undercutting Coal India if they don't improve - while leaving his fingers off the effects of the reform.

    Good news for the Chinese, and solar in general. I have you to thank for that in part - it's because of good arguments like yours and John Quiggin's that I've become more bullish on solar and renewables in generals. Get solar cheap enough, and we'll undoubtedly figure out some combination of renewables and storage woven together into a grid.

    1. If Coal India's problems result from the lethargic culture to which large state-owned monopolies are prone, a managerial shakeup might work. But if the regularly missed targets come simply from a deluded or servile top management. it's possible that the operating units are doing as well as can reasonably be expected in the real environment, against the constraints of geology, the labour market (rising wages and prosperity make it harder to find men who will take on dangerous and unpleasant work), and conflicts over land use - such as plans to open opencast mines in public forests. If the problems are structural, there is no quick fix. Of course, the rest of us are hoping Coal India will fail, for whatever reason.

      It’s very cheering to hear that my writing - actually, my reporting of facts - has had an impact on one reader’s thinking. Happy New Year!

Comments are closed.