Countries are pledging to abandon coal, but significant challenges remain

Despite the ever-increasing determination to reduce coal consumption, several governments face difficulties in managing the transition. Coal set a historic low in 2020 but has since rebounded substantially, prompting concerns about whether enough is being done to transition away from fossil fuels.

According to the IEA’s energy review, worldwide coal demand will fall by 4% in 2020, the largest drop in a single year since World War II. This was largely due to the coronavirus pandemic, which slowed economic development and reduced power use significantly.

This was especially noticeable in the electricity industry, where demand drops accounted for more than 40% of worldwide demand reductions in 2020. Both the United States and the European Union cut their usage of coal dramatically, with both countries reducing their use for electricity generation by one-fifth.

The 4% reduction in worldwide coal consumption is predicted to be reversed in 2021, with a 4.5 percent gain expected. The global recovery in coal demand is not uniform. According to the IEA, Asia has seen a significant increase in the use of coal for electricity generation, accounting for three-quarters of the comeback in 2021.

This creates a challenge in addressing the issue of reducing the use of coal as an energy source, as many developing countries are now more reliant on coal than ever before.


Some countries are already transitioning away from coal

Currently, coal is the most dominating source of energy on the earth, and UNFCCC research has cautioned that it is a major source of greenhouse gas emissions. According to internal data, coal and coal gaseous fuels account for 30.2 percent of total world power output.

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The transition away from reliance on coal has already begun in Europe and the United States, and experience has shown that it can take decades, due to not only presenting economic challenges and resulting in the loss of thousands of jobs, but also social and cultural challenges as the world adjusts to renewable energy as the Norm.


There have been concerns expressed about whether enough is being don

During a recent discussion at the World Bank’s annual meetings, Mari Pangestu, managing director for Development Policy and Partnerships, stated that shifting away from coal for energy generation is the “single most significant step toward reducing global warming.” This poses a significant challenge to governments in terms of how to manage this energy transition without negatively impacting towns and families that rely on the coal sector to thrive.

The World Bank Group has devised a ‘Just Transition For All’ project to facilitate the transition away from coal while reducing the negative consequences. This project has already committed more than $3 billion in support of coal transitions and works with communities to reuse old mining land and assets in order to lessen the consequences on impacted peoples.

There has already been tremendous success in this shift, with almost three-quarters of planned power plants globally being reduced since the 2015 Paris Climate Agreement.

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