Coal to surpass oil as top global fuel by 2020: report – by Florence Tan (Reuters/National Post – October 16, 2013)

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Coal will surpass oil as the key fuel for the global economy by 2020 despite government efforts to reduce carbon emissions, energy consultancy firm Wood Mackenzie said on Monday.

Rising demand in China and India will push coal past oil as the two Asian powerhouses will need to rely on the comparatively cheaper fuel to power their economies. Coal demand in the United States, Europe and the rest of Asia will hold steady.

Global coal consumption is expected to rise by 25% by the end of the decade to 4,500 million tonnes of oil equivalent, overtaking oil at 4,400 million tonnes, according to Woodmac in a presentation on Monday at the World Energy Congress.

“China’s demand for coal will almost single-handedly propel the growth of coal as the dominant global fuel,” said William Durbin, president of global markets at Woodmac. “Unlike alternatives, it is plentiful and affordable.”

China – already the top consumer – will drive two-thirds of the growth in global coal use this decade. Half of China’s power generation capacity to be built between 2012 and 2020 will be coal-fired, said Woodmac.

China has no alternative to coal, with its domestic gas output limited and liquefied natural gas (LNG) imports more costly than coal, Durbin said.

“Renewables cannot provide base load power. This leaves coal as the primary energy source,” he said.

ASIA TO FOCUS ON LOW-COST COAL

Power infrastructure provider Alstom estimated that across Asia close to half of the 600 gigawatt of new power generators to be built over the next five years will be coal-fired, Giles Dickson, a vice president at the company said.

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