Australia contributes to sharp decline in global coal consumption

Consumption of coal as an energy source has fallen

Global coal consumption fell sharply for the second consecutive year in 2016, according to a BP report.

Coal’s share as a primary energy source dropped to 28.1 per cent, its lowest level since 2004, BP’s annual Statistical Review of World Energy revealed.

Only four years ago coal recorded the largest demand growth of any source of energy analysed in the study.

Global coal consumption fell by 53 million tonnes of oil equivalent (mtoe), or 1.7 per cent. Australia was part of this decline, albeit at a minor scale compared with other countries.

The largest drops in coal consumption were seen in the United States (8.8 per cent) and China (1.6 per cent), while usage in Australia declined by less than one per cent (43.8mtoe).

The study found that world coal production fell by 6.2 per cent, or 231mtoe, the largest decline since the report started.

Output in Australia fell by 2.4 per cent (299.3mtoe), also a marginal drop compared to other leading global producers. China’s production fell by a record 7.9 per cent (1685.7mtoe), while US output was 19 per cent (364.8mtoe) lower.

BP chief economist Spencer Dale believes the turnaround in the fortunes of coal over the past few years is stark.

“It is only four years ago that coal was the largest source of energy demand growth,” he commented.

“There may be further ups and downs in the fortunes of coal over coming years, but the weakness in recent years does seem to signal a fairly decisive break from the past.”

Meanwhile, Australia is leading global growth in the production of natural growth as LNG projects around the country continue to develop.

Australian natural gas production of 19 billion cubic metres was the standout performer at several new LNG facilities came on stream.