IEA says coal use hit an all-time high last year — and global demand will persist near record levels

Story by Anmar Frangoul • CNBC

The IEA said 10,440 terawatt hours were generated from coal in 2022.

That figure accounted for 36% of the planet's electricity generation.

A fossil fuel, coal's use has a substantial impact on the environment.

Freight trains loaded with coal in China on Jan. 12, 2022. According to the IEA, coal consumption hit a record high last year

Coal consumption increased by 3.3% to hit a fresh record high of 8.3 billion metric tons in 2022, the International Energy Agency said Thursday.

According to the Paris-based organization's Coal Market Update, demand increased "despite a weaker global economy, mainly driven by being more readily available and relatively cheaper than gas in many parts of the world."

Overall, the IEA said 10,440 terawatt hours were generated from coal in 2022, a figure that accounted for 36% of the planet's electricity generation.

Looking ahead, the IEA said coal consumption in 2023 would remain near last year's record levels.

Geographically, the picture in 2023 is mixed. "By region, coal demand fell faster than previously expected in the first half of this year in the United States and the European Union — by 24% and 16%, respectively," the IEA said in a statement accompanying its report.

"However, demand from the two largest consumers, China and India, grew by over 5% during the first half, more than offsetting declines elsewhere," it added.

Coal is a fossil fuel. Its use has a substantial impact on the environment, with environmental organization Greenpeace describing it as "the dirtiest, most polluting way of producing energy."

The U.S. Energy Information Administration, meanwhile, lists a range of emissions related to the burning of coal, including carbon dioxide, sulfur dioxide, particulates and nitrogen oxides.

"Coal is the largest single source of carbon emissions from the energy sector, and in Europe and the United States, the growth of clean energy has put coal use into structural decline," Keisuke Sadamori, the IEA's director of energy markets and security, said Thursday.

"But demand remains stubbornly high in Asia, even as many of those economies have significantly ramped up renewable energy sources," he added.

Going forward, Sadamori said "greater policy efforts and investments" were needed in order to "drive a massive surge in clean energy and energy efficiency to reduce coal demand in economies where energy needs are growing fast."