Chinese coal demand fell in 2014

New figures from Beijing government shows China’s hunger for coal is waning

By Sophie Yeo

Coal demand in China dropped by around 2.3% in the first eleven months of 2014 compared to the same period in 2013, government figures show.

Production of coal in China declined by 2.1% and imports fell 9.0%. Meanwhile, China’s economy and production of electricity continued to grow.

The latest figures reinforce analysis by Greenpeace last October suggesting that Chinese coal consumption was going down.

This reflects “a rapid loss of market share for coal in 2014,” says Tim Buckley, director of energy finance studies at the Institute for Energy Economics and Financial Analysis (IEEFA).

It has been edged out by alternative sources of electricity generation across China: wind, solar, hydro, nuclear, biomass and natural gas.

IEEFA predicts that global coal demand will peak in 2016, mirroring China’s reduced reliance on the fuel.

Between 2000 and 2010, China’s demand for coal grew at an average of 9% per year. In 2013, the country was responsible for 47% of global consumption.

That has driven rising greenhouse gas emissions. China’s emissions per person are now greater than in the EU, although remain less than half than the US.

China is also investing heavily in renewable energy. In 2013, China installed 12GW of solar power, more than any other country.

Economic growth

Buckley says demand for electricity is no longer growing at the same speed as the economy.

Over the past 13 years, the two have increased in tandem. Now the need for electricity is rising at just over half the pace of economic growth. This shows the success of energy efficiency and China’s transition towards less electricity-intensive industrial sectors.

There is pressure on the government in Beijing to reduce China’s emissions from both home and abroad.

Hazardous levels of air pollution in major cities have led to criticism in the country’s media.

And governments across the world are waiting to see what China will contribute to the UN’s 2015 climate change treaty – an announcement that could be made as early as March.

Beijing has already announced that it will peak its emissions by 2030.

Buckley says: “The bottom line today is that the traditional nexus between real GDP growth, electricity expansion and coal demand is now broken.”

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