Climate graphic of the week: Asia-Pacific remains stuck on coal for half its power needs

The Asia-Pacific population’s dependence on coal remains significant even as it grapples with the high prices and global warming impact of the fossil fuel that now represents nearly half of the region’s primary energy consumption.

The latest figures from BP’s Statistical Review of World Energy underline both the importance of coal to the area itself and as a share of the world’s energy consumption, standing at just over a fifth of the global total.

This is despite the pledge from almost 200 countries at the UN COP26 summit in November to “phase-down” the use of coal to tackle climate change, weakened from “phaseout” after intervention from China and India.

In 2021, coal consumption grew more than 6 per cent globally to its highest level since 2014, the data shows. China and India accounted for almost three-quarters of the growth in demand.

This came as electricity needs rose again following the recovery in economic activity after the pandemic, and wind and solar also contributed more than 10 per cent of energy sources for the first time.

But coal remained the dominant fuel for power generation globally in 2021, its share increasing to 36 per cent, up from 35.1 per cent in 2020.

The Asia-Pacific dependency on coal shows little sign of waning. In part this is due to the region’s soaring demand for energy, driven by the industrial powerhouse of China, responsible for more than half of the region’s consumption.

Energy consultancy group Wood Mackenzie noted this week that the region was still “at its infancy in the long journey to net zero” emissions.

The total fossil fuel share of the Asia Pacific power system, including oil and gas, at 70 per cent was likely to remain high despite the falling costs of renewable energy sources, the group said in a report earlier this year.

Action to reduce consumption of coal, as the most carbon intensive fossil fuel, falls into two broad areas — lowering emissions from existing facilities and halting the construction of new plants.

But the cost of the lowering emissions from existing facilities is heavily dependent on expensive technology, through carbon capture and storage, or co-firing with lower emission fuels. Nowhere is this more important than in Asia, host to the world’s youngest generation of coal power plants.

Last year China pledged to stop building coal-fired power plants overseas, a move seen as “potentially very significant” by the International Energy Agency. But overall, action to date remains patchy with the pressure to sustain growth often seen at odds with the needs of introducing detailed measures sooner rather than later.

The World Bank has introduced a global initiative to support energy transition in coal regions that recognises the complexity involved in the shift from coal, and last week the G7 country leaders proposed new funding partnerships with India, Indonesia, Vietnam and Senegal to move away from coal to clean energy.

Again, Asia will remain the toughest nut to crack, as the global coal industry is dominated by the region. China is by some distance the world’s largest producer and importer of coal, while Indonesia and Australia are the world’s two largest exporters.

But there is evidence of a shift in some parts of the supply chain. In Australia, a newly elected government with a mandate to tackle climate change has made a pledge to reduce greenhouse gas emissions by 43 per cent by 2030. This is taking effect as public companies make plans to wind down coal production and invest instead in renewable energy.

China also remains the main driver of solar and wind capacity growth as it keeps in sight an ambitious target of “carbon neutrality” before 2060. It accounted for about 36 per cent and 40 per cent of the global capacity additions in solar and wind respectively in 2021, the BP report noted.

It is also the leading producer of minerals needed for renewable energy supply, including cobalt, lithium and bauxite, while its factories are supplying around half of all wind turbines and two-thirds of the world’s solar panels.