No surge, but no collapse. When the Paris Agreement was signed in 2015, coal demand was in the midst of a three‑year decline. The investment climate has also shifted. Non-governmental players, such as investors and companies have shown a strong commitment to acting on climate change. Public opposition to fossil fuels, particularly coal, is growing. Competition from natural gas and, increasingly, from renewables is coinciding with carbon pricing and policies to phase out coal in power generation. Together, these factors are shrinking the role of coal power generation in advanced economies. These shifts have raised expectations once again that demand for coal is about to collapse. However, global coal demand has rebounded since 2017. Although it will probably decline in 2019, we expect it to remain broadly steady thereafter through 2024.

Expectations of an imminent coal collapse have come and gone before. The adoption of the Kyoto Protocol in 1997 coincided with a three-year decline in global coal consumption (1997-99), and the imminent end of coal was heralded. But the decline turned out to be the result of some specific circumstances such as the Asian financial crisis and did not last. Between 2000 and 2013, global coal use rebounded spectacularly. It soared 75%, more than it had done over the entirety of the previous nine decades. A similar upsurge is not expected in today’s context, but neither is a sudden plunge.