Back in November of last year, the US and China came to an agreement to ensure a peak in carbon dioxide emissions by 2030. After 2030, yearly emissions would go down. Estimates by scholars in China were that by 2030, emissions would peak at 10.6 billion tonnes, 34% above the 2012 rate of 7.9 billion tonnes a year.1 To wait this long with reducing emissions would be catastrophic, eliminating any chance we might have to stay beneath two degree Celsius.

The problem with passing the two degree target is that we expect a number of positive feedback loops to kick in eventually, that will start emitting such high amounts of greenhouse gasses on their own that humans lose their control over the process. As some examples, bacteria in wetlands start producing higher amounts of methane, while the melting of permafrost will release methane as well. Forests may start to die in giant forest fires, releasing the carbon that’s currently stored in their soil and biomass.

Is there no solution whatsoever then? Well, there is one glimmer of hope. This hope is referred to as peak carbon: The idea that most of the world’s remaining fossil fuels are of such low quality that their use will prove to be economically nonviable. As a result, carbon and methane emissions would peak. Humans would be forced to start using drastically less energy and the economy would rapidly start to contract.

Peak carbon would require a painful and difficult period of transition. How painful such a transition would be depends largely on whether we took measures to prepare ourselves for this scenario and how a society responds to sudden shortages. Societies that suffer internal cultural divisions, like Syria and Iraq, seem less capable of coping with prolonged periods of economic contraction in a stable and peaceful manner than societies that are more homogeneous, like Japan and Greece.

Peak carbon is an extension of a concept that most people have heard of, peak oil. Peak oil has traditionally been seen as the fossil fuel that will be first to pose significant problems of shortage. Unlike coal and natural gas, the Western world has had experiences with oil shortages in the 1970’s, as a result of political instability affecting the middle east. Thus our society’s dependence on oil has traditionally been more prominent on the public radar than our dependence on coal and gas.

There are however peculiar global developments that suggest we are reaching limits in multiple natural resources simultaneously, which may lead to the phenomenon of peak carbon. To start with, the world was surprised a few months ago, with the news that CO2 emisisons in 2014 had flatlined compared to 2013.2 This is a unique development that hardly anyone had anticipated. The Global Carbon Project estimated in September 2014 that CO2 emissions in 2014 would be 2.5% higher than in 2013.3

Thus, it would appear that in late 2014, something began to readily diverge from our projections. Something highly unusual appears to have happened in China.4 Economic growth declined to its lowest rate since 1990. Energy consumption in China grew by just 3.8%, while coal consumption dropped by 2.9%.

Important to note first of all is that this is not a fluke. The decline in coal consumption fits an overall pattern seen in China over the past few years, which suggests that China is running out of high quality coal. The image below shows Chinese coal production until 2009:

What we see here is that although Bituminous coal production continued to grow enormously, Anthracite production peaked. This is a signal of depletion, as anthracite is generally seen as a very high quality type of coal. Most of the world’s industrialized nations have hardly any anthracite left, some are even starting to run out of bituminous coal. As the image below demonstrates, the overall rate of growth in coal production also began to slow down before the drop observed in 2014:

This decline of coal consumption in China also corresponds to a global plateau in coal consumption:

Interestingly enough, the decline in coal consumption in China appears to continue. On an annualized basis, statistics show that in the first four months of 2015, coal consumption in China dropped by an incredible 8%, while overall CO2 emissions dropped by 5%.8 So, what has happened then? There have been suggestions that the Chinese data are simply inaccurate, that coal mines are continuing to produce coal without being registered by the Chinese government. However, the stabilization in coal production has been a process that has taken place over multiple years, so I consider this an unlikely explanation, as the data fit in line with what we would expect.

It would also be persuasive to assume that the Chinese economy has simply started to decarbonize, by transitioning to low-carbon sources of heat and electricity and increasing energy efficiency. This would contradict the Chinese plan to peak carbon emissions by 2030 however. Why wait until 2030 and risk a global catastrophe, if you’re perfectly capable of reducing your emissions without affecting economic growth today?

A third possible explanation would be to suggest that the Chinese economy is being involuntarily decarbonized. Perhaps the Chinese are simply no longer capable of burning ever increasing amounts of coal. Multiple factors can be responsible for this. Overseas demand for carbon-intensive products may have declined. Low coal prices triggered by low demand may have forced some coal manufacturers to drastically reduce their production, because they can not produce coal at such low costs.

Evidence that verifies the case for low demand being responsible would include the 6% decline in demand for steel in the first quarter of 2015.11 Rail freight in China is declining by double-digit figures, and electricity use has declined for the first time since 2009, back when the world was in the middle of the global recession. In light of these problems, some analysts are skeptical about the GDP growth figures coming out of China.

There are also other factors, that could be interpreted as either voluntary or involuntary decarbonization, depending on how you wish to look at it. The Chinese government estimated in 2014 that 20% of its farmland is polluted, as a result of industrial activity. Many places face epidemics of birth defects as a result of pollution and cities across China are facing enormous problems with smog. Some coal resources are so dirty that the Chinese government aims to ensure through regulations that they will never be burned.9 If there is no “clean” coal available to replace such dirty coal, it’s inevitable that less coal will have to be burned.

The idea of China hitting peak coal around this time may come as a shock to some of us, but others have anticipated something similar occurring on a global level around this time. In 2010, Tadeusz Patzek estimated that the world would hit peak coal around 2011.10 The exact year that global coal production would peak is less interesting than the implication. He found that 36 of the IPCC’s 40 projected scenarios for the future are not going to happen, simply because we will never find enough fossil fuels that we can afford to burn. Croft estimates that we only have enough fossil fuels left to raise global temperatures by another 0.8 degree Celsius, which should mean that we end up staying well below 2 degree, assuming that positive feedback loops don’t begin to kick in yet at such temperatures.20

The idea of peak coal is not as strange as it may seem. The deindustrialization of Europe and North America that we have seen occur can be largely attributed to the fact that we simply could not afford to maintain our energy-intensive economies. The United Kingdom, which was first to undergo the industrial revolution, saw its coal production peak in the year 1913, at 292 Mt (million metric tons). Today, electricity prices in Germany, Denmark and other European countries are around four times as high as the price in India and China.

Western governments take limited action to maintain energy-intensive manufacturing industries inside their own countries. Rather, they try to preserve the relevance of their economies by focusing on service jobs. We find for example that Western nations prefer to focus on branding, marketing and associated factors in their products. The EU ensures that only certain regions of France are allowed to call their wine champagne.

To make the case for peak coal in China, it’s important to note the historical difference in coal use between China and Europe. Whereas between the year 1 and 1000, China had a significant share of the world’s population, Europe’s share back then was relatively low. Lower population density allowed Europe to use wood as a source of heat energy, whereas China was forced to rely on coal. In Britain some monarchs even prohibited the burning of coal, because of the pollution it created.

As a result, we find that throughout recorded history, China has always had a fair amount of industrial activity involving coal combustion, whereas Europe did not. No other nation in the world came as close to an industrial revolution as Southern Song did between 1127 and 1279. Such industrial activity also would have been significantly less energy efficient than modern industrial activity. Thus, although coal was burned at nowhere near the yearly rate that China currently uses it, hundreds of years of industrial activity may have robbed China of some of its best and most easily accessible coal.

In addition to this, there is no guarantee that other nations have high quality coal reserves about as large as those found in Europe. Climatic and geological conditions have varied across different parts of the planets for millions of years. Europe’s brown coal deposits were mostly produced by the giant coniferous trees related to redwoods that once grew in Europe millions of years ago. A different climate in China can have the effect of producing fewer economically useful coal deposits than we find in Europe.

At around 28% of the world’s carbon emissions, China is the most important factor in global carbon emissions.The United States trails China at about 15% of the world’s emissions. Looking at coal alone, China and the US are responsible for 40% and 16.2% of emissions respectively. In regards to the United States, the total tonnes of coal mined peaked in 2008. On the other hand, the total energy content of the coal mined peaked in 1998, because the quality of coal mined continues to deteriorate.12 By 2012, the total energy content of coal mined in the United States was down to 86% of its 1998 high. Natural gas has been increasingly forced to substitute for coal as a result.

An interesting development we can note in American coal production is that the sulfur content in burned coal is steadily climbing. Whereas between 2005 and 2008, sulfur content hovered around 0.98%, by 2009 sulfur content began to climb, rising to 1.32% by 2014.16 This is odd, considering the glut of natural gas. We would expect that abundant natural gas would have the effect of enabling a move away from dirty coal. The rise in sulfur content is indicative of the increasing use of brown coal of a particular low quality.

Since China and the United States together constitute more than half of global coal production, a peak of coal use in these nations can be sufficient to ensure that the peak in coal use is now behind us. A skeptic might argue that this does not necessitate peak coal, because other developing countries home to billions of people are still nowhere near the level of electricity use of the Western world.

A big part of future coal use hinges on the amount of recoverable coal found in India, something still unclear. India’s coal use is rising rapidly to serve its rapidly expanding economy, but the industry is mired by tremendous corruption. This is a problem that can be overcome, but it leaves us to wonder how much can be stated with certainty in regards to the size of its coal deposits.

Greenpeace has published an interesting report on India’s coal reserves.13 By 2012 it stated, India’s main producer CIL, responsible for 80% of production, had revised its coal reserves downwards by 16% compared to 2010. The company has consistently failed to meet its production targets. Greenpeace estimated in 2013 that at India’s targeted growth rates, CIL’s official coal reserves could be depleted within 17 years.

Important to note here is that CIL’s coal reserves are in all likelihood hopelessly optimistic. CIL has not made any effort to estimate geographical and land use limitations in its estimate of extractable coal reserves. This is quite a big problem, as India’s population density is about as high as the Netherlands’. Much of it would thus seem likely never to be used, as the soil above the coal deposits will prove to be more valuable. To recover coal after all is inevitably a more disruptive process that recovering oil or gas.

When it comes to coal, it’s important to note that different grades of coal have different properties and uses. Anthracite is generally the most useful type, followed by Bituminous and sub-bituminous. There is also coal that can be classified as metallurgical grade, based on its purity. This type of coal has to be very low in contaminating elements, as steel is very vulnerable to the effects of adding small amounts of sulfur or phosphorus.

Finally, we have lignite, the desperate man’s coal. Burning lignite yields so little energy, that lignite has to be burned directly near the location where it is recovered, as transporting this heavy coal over large distances means that you simply end up spending more energy transporting the coal than you recover from it. At this point, Germany only has significant amounts of lignite left. This forces the country to forcibly evacuate small towns that happen to have lignite beneath their soil. For this reason, Germany is particularly enthusiastic about transitioning to renewable energy.

Having some background knowledge about the different types of coal out there allows us to look at stated coal reserves with some skepticism. As an example, Pakistan has large lignite deposits in the Thar desert. This lignite will have to be burned on the spot to generate energy, it can not be exported. Of course this yields some problems, as mining and burning coal requires large amounts of water, water that simply is not available in a desert in the middle of Pakistan.

This is part of a larger problem that industry in countries closer to the equator will face should they ever seek to utilize large amounts of nuclear or coal power. Water is used to generate power. This water can then be passed through cooling towers, where it is lost to evaporation. Large parts of the world are increasingly facing water shortages and will thus be less than enthusiastic about losing what little water remains to coal plants. These towers tend to be expensive to build, so many coal plants don’t have them. Rather than losing the water to evaporation, it can also be dumped back into a river or lake, where it causes thermal pollution, which kills most of the fish that live there and creates toxic algae blooms and other problems.

We’ve looked at the problems that coal extraction faces. It’s interesting to look at oil and natural gas now, although an in depth analysis of oil and natural gas depletion is outside the scope of this essay. It’s worth noting however, that there is agreement that conventional oil has peaked in 2006, as even the IEA admits.17

What has increasingly substituted for conventional oil is unconventional oil, that is comparatively dirty, with higher carbon dioxide emissions per barrel of oil production. The debate focuses on whether or not the economy can continue to function when it becomes fully dependent on such unconventional oil.

In regards to unconventional oil, it remains to be seen how much of its is economically viable to extract. Current oil prices have rendered much of the US shale oil deposits economically nonviable to extract, even though these companies benefit from low interest rates as a result of monetary policies. Companies have focused on “sweet spots”, where the geology is just right. The American “miracle” is also unlikely to be repeated elsewhere, as the United States is believed to have more than three quarters of the world’s reserves.

Shale gas, now making up 39% of US natural gas production, can be produced at a low cost, because of the negative externalities that are imposed on the environment. If companies can be sued for the earthquakes their waste injections cause, oil and gas production is jeopardized.18 In the meantime, the earthquakes continue to get worse. The Oklahoma geological survey projects 941 M3+ earthquakes over the entire year 2015, a thousand-fold increase over the earthquake rate before the wastewater injection process began.19

The problems of peak oil and peak coal are difficult to see as separate from one another, as shortages in one resource will significantly affect the production potential of the other. Production of oil shale, with its extensive network of pipelines and many wells, requires high amounts of steel. The collapse of the oil shale industry in the United States is causing hundreds of people working in the steel manufacturing industry to lose their jobs. Steel production in turn depends largely on coal, 12% of all the world’s coal is used to produce steel, a figure that includes the poor quality coal types like lignite that are exclusively used for electricity generation.14

We find ourselves faced with a situation where a variety of resources are becoming increasingly difficult to extract. As an example, the mining industry in Australia is faced with ore grades that have halved in thirty years, while waste that has to be removed to access the ores has doubled, causing a tremendous increase in required energy.14 This shouldn’t be surprising, as the process of industrialization and exponential economic growth has meant that exploitation of a variety of resources is now at record highs. The effect the situation has on our economy is comparable to adding a variety of heavy burdens on a camel’s back.

1 – http://www.reuters.com/article/2014/11/14/china-carbon-idUSL3N0T41EY20141114

2 – http://www.iea.org/newsroomandevents/news/2015/march/global-energy-related-emissions-of-carbon-dioxide-stalled-in-2014.html

3 – http://www.earth-syst-sci-data-discuss.net/7/521/2014/essdd-7-521-2014.html

4 – http://www.bloomberg.com/news/articles/2015-03-13/china-s-carbon-emissions-drop-for-the-first-time-since-2001

5 – http://upload.wikimedia.org/wikipedia/commons/d/d7/China_coal_prod.PNG

6 – Found on http://cassandraclub.wordpress.com

7 – Found on http://cassandraclub.wordpress.com

8 – http://www.vox.com/2015/5/22/8645455/china-emissions-coal-drop

9 – http://www.wsj.com/articles/china-coal-ban-highly-polluting-types-banned-starting-in-2015-1410852013

10 – http://www.nytimes.com/gwire/2010/09/29/29greenwire-study-worlds-peak-coal-moment-has-arrived-70121.html?pagewanted=all

11 – http://www.bloomberg.com/news/articles/2015-04-29/china-s-steel-demand-slides-from-peak-while-exports-supported

12 – http://www.eia.gov/cfapps/ipdbproject/iedindex3.cfm?tid=1&pid=7&aid=1&cid=ww,&syid=1980&eyid=2012&unit=TST

13 – http://www.greenpeace.org/india/Global/india/report/2013/Coal-India-Running-on-Empty.pdf

14 – https://coalactionnetworkaotearoa.wordpress.com/2013/04/24/can-we-make-steel-without-coal/

15 – https://web.archive.org/web/20130409115625/http://www.crcore.org.au/ind-challenge.html

16 – http://www.eia.gov/electricity/monthly/current_year/march2015.pdf

17 – http://www.treehugger.com/corporate-responsibility/iea-chart-says-conventional-oil-production-peaked-in-2006.html

18 – http://www.wsj.com/articles/frackings-new-legal-threat-earthquake-suits-1427736148

19 – http://upload.wikimedia.org/wikipedia/commons/thumb/e/eb/Oklahoma_3.0_earthquake_bar_graph_since_1978.png/800px-Oklahoma_3.0_earthquake_bar_graph_since_1978.png

20 – http://www.nytimes.com/gwire/2010/09/29/29greenwire-study-worlds-peak-coal-moment-has-arrived-70121.html?pagewanted=all