China’s economic rebalancing will see its greenhouse gas emissions peak as early as 2025, forecasts Bloomberg New Energy Finance.
Yet rising coal use in India and other emerging Asian markets points to a 5% increase in global emissions from 2015 levels by 2040.
More bullish about renewable energy’s prospects than oil majors are, BNEF’s outlook nonetheless warns the transition is not going fast enough to meet international climate goals.
Between 2016 and 2040, analysts project US$7.8 trillion globally will flow into clean energy – two thirds of total power sector investment.
But lead author Seb Henbest said: “It would require trillions more to bring world emissions onto a track compatible with the United Nations 2C climate target.”
India is critical, with electricity demand set to grow 3.8 times over the period. Despite pouring $611bn into renewables and $115bn into nuclear, the surging economy is expected to rely heavily on coal, trebling its power sector emissions.
Separate analysis suggests the country’s dash for coal is not straightforward, however.
Several plants were forced to temporarily shut down this year due to a lack of water for cooling. Using publicly available data, Greenpeace estimates drought-related closures cost $350m in the first five months of 2016.
Delhi last week cancelled four “ultra mega” coal plants worth 16GW. Power Engineering International attributed this to inadequate land and water availability.
It is also in line with minister Piyush Goyal’s desire to reduce coal imports, noted Australian think tank the Institute for Energy Economics and Financial Analysis (IEEFA).
“This is yet another major policy shift underscoring how seriously India is working to transform, modernize and diversify its electricity sector away from coal,” said IEEFA’s Tim Buckley.
Sufficient availability of fossil fuels leads to around 19% decline in coal imports in May’16 as compared to May’15 https://t.co/90IuyQegau
— Piyush Goyal (@PiyushGoyal) June 13, 2016
Minister Goyal has told Bloomberg he would like to eliminate reliance on foreign coal within two or three years.
While he emphasised domestic production rather than plant closures to achieve this, it dealt a further blow to Australian mine expansion plans.
The biggest investor in those prospective coal fields, Indian billionaire Gautam Adani, told the Australian a week ago he could abandon the project amid protracted legal challenges.