Coal is the single greatest source of worldwide carbon dioxide (CO₂) emissions, and burning just a quarter of the known reserves of coal would break the global carbon budget. Coal use contaminates air, water, and soil, and has serious health and economic impacts. It also requires substantial resource use, and particularly threatens water resources.

Climate Pollution

Coal is the single greatest source of worldwide carbon dioxide (CO₂) emissions, the primary cause of climate change. In 2009, coal accounted for 43% of total global CO₂ emissions (or 12.5 Gt).[1]  In 2012, China’s coal consumption alone was responsible for two-thirds of the increase in global CO₂ emissions. According to the International Energy Agency (IEA), if we continue on a business as usual path, the world will burn 1.2 billion tons more of coal per year by 2017 and over the next 25 years coal’s share of global CO₂ emissions will grow to 50%.

During the Warsaw 2013 UNFCCC COP, 27 leading climate and energy scientists from 15 countries issued a joint statement that burning just 26% of the world’s known coal reserves would break the global “carbon budget”, thereby raising temperatures above the 2?C threshold, beyond which the worst of climate impacts are expected.[2] In other words, nearly 75% of the world’s coal represents unburnable carbon, which needs to stay in the ground.

As such, the scientists further stated: “There is no room in the remaining carbon budget for building new unabated coal power plants, even highly efficient ones, given their long lifetimes.”

Local Environmental Pollution

At every stage of its life, coal does serious damage in terms of contamination of air, water and soil, displacement of communities, loss of livelihoods, destroyed forests, depletion of water resources, and loss of agricultural lands. Coal-fired power plants emit more than 60 different hazardous pollutants, including particulate matter, sulfur dioxide, nitrogen oxides, and heavy metals like mercury, arsenic, cadmium, and lead.[3]  Emissions from coal plants in China were responsible for a quarter of a million premature deaths in 2011 and are damaging the health of hundreds of thousands of Chinese children, according to a study commissioned by Greenpeace. In Indonesia and India, over 2 million hectares of rainforest and other critical forests are under immediate threat from coal mining concessions.[4]

Mining, processing (e.g. washing), ash disposal, and burning of coal puts an enormous strain on water supplies, especially in regions where water is scarce. It is estimated that 2.3 cubic meters of water are withdrawn for every ton of coal mined.[5] A recent study into the impacts of the Galilee Basin coal mines in Australia found that the equivalent of two-and-a-half Sydney Harbors’ worth of water – 1,343 billion liters – would be lost from the Basin if the mining goes ahead as proposed, causing potentially “permanent and unacceptable impacts on regional groundwater and surface water resources”.[6]

According to the World Bank, 2.8 billion people live in areas of high water stress. In a climate constrained world, water resources will become even scarcer in many areas.

Statistical Trends in the Expanding Coal Industry

Since 2000, global coal production has grown by 70 percent. Even though some market analysts believe that global demand will peak before 2020, largely due to China’s pollution concerns, and despite the fact that current coal reserves already amount to 132 years of global supply, the coal industry still continues to explore for more coal. Public subsidies and financing for coal help make otherwise uneconomic projects financially viable.

Even though it is clear that for the world to continue to burn more and more coal is to the detriment of the world’s life-sustaining systems, coal continues to grow at an alarming rate, supported by public sector subsidies and financing.

Coal Consumption

In 2012, coal generated 41% of electricity globally and produced 70% of the world’s steel.  Eighty percent of coal produced goes toward electricity production and 13% goes toward steel.

Table 1 provides a list of countries with some of the highest dependencies on coal for electricity generation. In 2012, 1,199 new coal plants were proposed globally, which would add a total installed capacity of over 1,400 Gigawatts (GW). These planned projects are spread across 59 countries with China and India accounting for 76% of the proposed new capacity.

In 2011, 76% of world coal consumption was accounted for by just five countries: China (excluding Hong Kong), the United States, India, Russia, and Japan. When the top ten are included, by adding South Africa, Germany, Korea, Poland, and Chinese Taipei, then 86% of the world coal consumption is accounted for.

[table caption=”Table 1. Share of Coal in Electricity Generation (2012)” width=”100%”]

Mongolia} 98%} Australia} 69%} USA} 43%
South Africa} 94%} India} 68%} Germany} 43%
Poland} 86%} Israel} 59%} UK} 29%
PR China} 81%} Indonesia} 44%} Japan} 27%

[/table]

Source: World Coal Association[7]

China accounts for over 50% of global coal demand and thus, what happens in China has an enormous influence on the future of coal. Significant shifts in China’s economic structure and energy sector are causing many industry analysts to reassess coal’s perpetual climb.  Key drivers in China include: (1) air pollution concerns; (2) downward shifts in China’s GDP growth and energy intensity; (3) robust growth of China’s renewables, along with increased availability of natural gas; and (4) efficiency improvements in coal power plants and energy demand. These drivers have caused some analysts to project a possible flattening or peaking of global coal demand before 2020.[8] Even if the predicted flattened global coal demand comes true in the near future, without substantial reductions in coal consumption, we will still exceed the carbon budget and still face all the social and environmental problems associated with a continued dominance of coal.

Coal Production

Since 2000, global coal production has grown by 70% and has now reached a staggering 7.9 billion tons annually. The year 2012 was the 13^th year in a row of growth.  In 2012, 76% of world coal production was accounted for by just five countries: China, the United States, India, Indonesia, and Australia. Including the top ten producing countries accounts for 90% of production (see Table 2).

[table caption=”Table 2. 2012 Top Ten Coal Producing Countries (Mt)” width=”100%”] PR of China} 3,549} Russia} 359
USA} 935} South Africa} 259
India} 595} Germany} 197
Indonesia} 443} Poland} 144
Australia} 421} Kazakhstan} 126
[/table]

Source: World Coal Association

Coal Export

The demand for global coal has shifted from the Atlantic market (driven demand reductions in Germany, the United Kingdom, France and the United States) to the Pacific market (driven by demand increases in Japan, China, South Korea, India and Taiwan). In response to this trend, many new infrastructure development projects have been proposed.[9] As shown in Table 3, the top two coal exporters, Indonesia and Australia, are the main suppliers of coal to the Pacific market and account for over half (54%) of all coal traded globally.

[table caption=”Table 3. 2012 Top Coal Exporters (Mt)” width=”100%”]

Indonesia} 383} USA} 114} Canada} 35
Australia} 301} Columbia} 82}}
Russia} 134} South Africa} 74}}

[/table]

Source: World Coal Association

Coal Exploration

Through new exploration, especially in Australia, India and Indonesia, hard coal reserves grew by 26 billion tons (3.6%) in 2011.[10] This translates to total global coal reserves of 1,038 billion tons, or 132 years of the world’s coal output at current rates of production.[11]