12 February 2015

Coal matters – divestment and the future of coal

We live in times of increasing energy demand where coal is a central part of the energy mix. Coal not only provides an affordable, reliable and accessible source of energy, but is also an indispensable ingredient for building modern infrastructure that supports urbanisation and economic development.

Coal – building modern infrastructure

Alongside its vital role in electricity generation, coal is also an indispensable ingredient for building modern infrastructure, such as transport systems and equipment and high-rise buildings, to support urbanisation and economic development. The materials used in these projects – steel, cement, glass and aluminium – are highly energy intensive.

There are two main steel production routes; the integrated steelmaking route and the electric arc furnace route. Coal is an essential raw material and energy fuel in both of them. Energy intensive industries require the reliable baseload power that can only come from large-scale hydropower, nuclear, gas, or – in most countries – coal.

Coal – meeting global energy demand

There are 1.3 billion people in the world today who live without access to electricity. 2.6 billion people rely on traditional fuels, such as dung and wood, for cooking. A life lived without access to modern energy is a life lived in poverty. The International Energy Agency (IEA) has predicted that more than half of the on-grid electricity needed to meet their ‘energy for all’ scenario (1) would need to come from coal.

1 The IEA defines ‘energy for all’ as up to five hours of electricity a day. This would be enough electricity in rural areas for the use of a floor fan, a mobile telephone and two compact fluorescent light bulbs. In urban areas, consumption might also include an efficient refrigerator, a second mobile telephone per household and another appliance, such as a small television. The ‘energy for all’ target excludes electricity for businesses, industry, hospitals, schools, public buildings etc.

The World Coal Association has produced ‘Coal Matters’, providing more facts on the future of coal. It can be found here: Coal_Matters_Divestment_Future_Role_Coal.

Back to News