The Asian perspective: thermal coal and renewables 5 Tim Power - Coal... · Source:- BP Statistical...

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The Asian perspective: thermal coal

and renewables

ESPO: PORTS IN A CHANGING CLIMATE, A CHANGING WORLD

June 01, 2017

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Historical development

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Thermal coal and renewables: the Asian Perspective

Global energy use: historical

• Source:- BP Statistical Review of World Energy 2016

Global energy use by source (1990-2015) % split by source (1990-2015)

0

4.000

8.000

12.000

16.000

1990 1995 2000 2005 2010 2015

M.

Tonne

oil

equiv

ale

nt

Oil Natural Gas Coal

Nuclear Hydroelectricity Biofuels

Renewables

CAGR (2000-2005) 4%(1990-1995) 1% (2005-2010) 3%(1995-2000) 2% (2010-2015) 2%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

1990 1995 2000 2005 2010 2015



Renewables

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Global coal production and trade

Source: Drewry Maritime Research, BP Statistical Review of World Energy 2016

Thermal coal production (million tonne oil equivalent)

13%

2%

11%

0%4%

70%

North America

S & C America

Europe & Eurasia

Middle East

Africa

Asia Pacific

Seaborne total coal trade development (million tonnes)

• Seaborne total coal trade increased at a

CAGR of 7% from 2005-2010 and 3% from

2011-2016

• In 2016, thermal coal production in Asia

Pacific region constitutes about 70% of the

total global production

781

956

1081

2008 2011 2016

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Seaborne coal trade totalled 1,081 million tonnes in 2016 with trade of 770 million tonnes of thermal coal, 271 million

tonnes of metallurgical coal and 40 million tonnes of anthracite coal

Source: Drewry Maritime Research

Aus – FE

Asia

284

Rus - FE

Asia

53

S&E Af-Eur

10

SE Asia-

FE Asia

144

Aus – SE

Asia

18Aus –Eur

23

S&E Af-S Asia

45

FSU-Eur

39

Intra S&C Am

15

S&C Am - ME

5

S&C Am - Eur

49

NAm - Eur

27

SE Asia-Eur

6

• More than one-fourth of the total seaborne trade is confined to Australia-Far East Asia, with China being

one of the largest importer of coal. With expectation of rising steel production in China , the demand for

metallurgical coal is expected to rise.

Global coal trade: total

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Global seaborne thermal coal trade in 2016 totalled 770 million tonnes. Total seaborne thermal coal trade constitutes

more than 70% of the total coal trade

Source: Drewry Maritime Research

Aus – FE

Asia

173

Rus - FE

Asia

41

S& E Af-Eur

10

SE Asia-

FE Asia

143

Aus – SE

Asia

14

Aus –N.Am

3

S& E Af-S Asia

45

FSU-Eur

36

Intra S&C Am

14

S&C Am - ME

5

S&C Am - Eur

48

S&C Am-NAm

9

NAm - Eur

8

SEAsia-Eur

6

Global coal trade: thermal

• The major trade lanes include Australia-Far East Asia (mainly China) route, South East Asia-Far East and

South East Asia to South Asia route

• Strict environmental regulations in China and rising share of clean energy sources will cap thermal coal

imports over the coming years

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Key trends and issues

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Steel and energy intensity: droppingModerating steel and energy intensity

100

110

120

130

140

150

160

200

0

200

1

200

2

200

3

200

4

200

5

200

6

200

7

200

8

200

9

201

0

201

1

201

2

201

3

201

4

Energy use (kg of oil equivalent) per $1,000 GDP (constant 2011 PPP)

Falling energy intensity in GDP: World

Source: berc.berkeley.edu; World Bank, IMF, World Steel Association

21,0

21,5

22,0

22,5

23,0

23,5

24,0

2011 2012 2013 2014 2015 (est) 2016 (est)

Global Steel intensity

Decline in steel consumption per unit of GDP

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Inequalities: power consumption per capita

Variations in per capita consumption are vast

0

2000

4000

6000

8000

10000

12000

14000

USA Germany UK Spain China India

Electric power consumption 2014

(kWh per capita)

Source: World Bank

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Outlook

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Global energy by source: outlook

Energy consumption growth continues to moderate and renewables share grows steadily

0

4.000

8.000

12.000

16.000

20.000

24.000

2015 2020 2025 2030 2035

Global energy use by source, 2015-2035



Renewables

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

2015 2020 2025 2030 2035

% split by source



Renewables

CAGR (2015-2020) 2% CAGR (2020-2025) 2%

CAGR (2025-2030) 2% CAGR (2030-2035) 1%

• Source:- BP Statistical Review of World Energy 2016

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Coal in power generation: regional outlook

Use of thermal coal will continue to rise in Asia, Africa and Latin America

Source:- BP Statistical Review of World Energy 2016, IEA

• In the period 2010-

2015, thermal coal

power generation

declined at a CAGR of

1% while power

generation using

renewables increased

by 17%.

• IEA expects the global

thermal coal demand

will continue to

increase, but the share

of coal in power

generation will decline

gradually in the

medium to long term

• Energy production

using thermal coal is

expected to fall in

European countries

with rising share of

renewables and natural

gas. 45% 44% 43%43%

-1% -4%

2%

-4%

2005-10 2010-15 2015-20 2020-25

North America

0%

-1% -1%-2%

2005-10 2010-15 2015-20 2020-25

Europe & Eurasia

3%

6%

2%

4%

2005-10 2010-15 2015-20 2020-25

South & Central America

-8,2%

1,4%-1,2% -1,2%

2005-10 2010-15 2015-20 2020-25

Middle East

8%

3% 2%2%

2005-10 2010-15 2015-20 2020-25

Asia Pacific

1%

2%

0%

1%

2005-10 2010-15 2015-20 2020-25

Africa

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China: historical

Energy consumption growth slowing; coal growth stopped; steady growth in renewables

0,00%

1,00%

2,00%

3,00%

4,00%

5,00%

6,00%

7,00%

8,00%

-

500,0

1.000,0

1.500,0

2.000,0

2.500,0

3.000,0

3.500,0

4.000,0

4.500,0

5.000,0

2010 2011 2012 2013 2014 2015

SCE

Ton

mn

Coal Oil Natural Gas Hydro

Nuclear Other Growth

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

2010 2011 2012 2013 2014 2015

Coal Oil Natural Gas Hydro Nuclear Other

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China: outlook

Consumption growth moderating and renewables share increasing; China plans to increase

the share of renewables from 12% in 2015 to 15% in 2020

14,50%

15,00%

15,50%

16,00%

16,50%

17,00%

17,50%

18,00%

18,50%

19,00%

19,50%

-

1.000

2.000

3.000

4.000

5.000

6.000

2010 2015 2020

Power generation plan

Coal Oil Natural gas Renewables Growth

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

2010 2015 2020

Coal Oil Natural gas Renewables

CAGR 2015-20Hydro 22%Wind 23%Solar 40%Biomass 15%

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India electricity demand

India’s demand for electricity is set to grow at a frantic pace: by 17% annually from 2012-

2022 and 12% annually from 2022-2030

0,00%

20,00%

40,00%

60,00%

80,00%

100,00%

120,00%

0

500

1.000

1.500

2.000

2.500

3.000

3.500

4.000

4.500

5.000

2012 2022 2030 2047

TWh

India's electricity demand by sector

Industry Residential Commercial Agriculture Others Growth

Source: Niti Aayog

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India power generation

Renewables share grows to 23%, but rising demand means that thermal coal consumption

will quadruple from 2012 levels

0

1.000

2.000

3.000

4.000

5.000

6.000

2012 2022 2030 2047

TWh

Ge

ne

rati

on

s

India's energy production by source

Coal Gas Nuclear Hydro Renewables Imports

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

2012 2022 2030 2047

% split by source

Coal Gas Nuclear Hydro Renewables

Source: Niti Aayog

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Summary

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Summary

• Growth in share of renewable energy will slow down growth in demand for thermal coal,

but thermal coal use will still grow.

• Energy production using renewables is expected to grow at a CAGR of 13% between

2015-2020.

• Energy production using coal is expected to rise at a CAGR of 1.8% between 2015-

2020.

• Coal demand will contract in Europe and North America.

• In Asia Pacific countries, thermal coal demand will continue to grow. India will be a large

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