After reaching a new high in 2024, global demand for coal is set to level off in the coming years as a surge in renewable power helps to meet soaring demand for electricity around the world, according to an International Energy Agency or IEA report today. Coal 2024 – the new edition of the IEA’s annual coal market report, which analyses the latest trends and updates medium-term forecasts – shows that global coal use has rebounded strongly after plummeting at the height of the pandemic. It is poised to rise to 8.77 billion tonnes in 2024, a record. According to the report, demand is set to stay close to this level through 2027 as renewable energy sources play a greater role in generating power and coal consumption levels off in China.

The electricity sector in China is particularly important to global coal markets, with one out of every three tonnes of coal consumed worldwide burned at a power plant in the country. In 2024, China continued to diversify its power sector, advance the construction of nuclear plants and accelerate its huge expansion of solar PV and wind capacity. This should help limit increases in coal consumption through 2027, according to the report, though it also highlights a number of key uncertainties in its analysis.

Electricity use in a number of countries, including China, is growing at a strong pace due to a combination of factors, including the electrification of services like transport and heating, rising demand for cooling, and increasing consumption from emerging sectors such as data centres. Additionally, weather patterns could drive fluctuations in coal consumption in the short term. According to the report, coal demand in China by 2027 could be up to 140 million tonnes higher or lower than forecast due to weather-related variability in renewable generation.

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