IEA 2010

From The Australian

Australia is the world’s largest coal exporter, with China and India between them taking almost 20 per cent of its thermal coal exports in 2008-09. Japan and South Korea remain the leading buyers at 39.8 per cent and 16.3 per cent respectively, followed by Taiwan on 9.9 percent, although a report by Deutsche Bank earlier this year said that China and India becoming net importers of thermal coal was transforming the trade.


“We believe China and India together could transform the demand landscape for thermal coal over the next decade, displacing current western importers and evolving to dominate the industry,” the report’s authors noted.

China likely overtook the United States in 2009 to become the world’s biggest energy user, according to IEA preliminary data. The third largest user is India, followed by Russia and Japan. While China and India have low per-capita energy usage, their combined population of 2.5 billion and their high economic growth rates ensure they will have a significant impact on the energy consumption outlook for decades to come.

China alone contributes 36 per cent of projected growth in global energy use between 2008 and 2035, under the central scenario – known as the “New Policies” scenario - of the IEA. India is the second largest contributor with 18 per cent.

“It is hard to overstate the growing importance of China in global energy,” IEA executive director Nobuo Tanaka said last month at the release of the agency’s latest World Energy Outlook in London.

“How the country responds to the threats to global energy security and climate posed by rising fossil-fuel use will have far-reaching consequences for the rest of the world,” he said.

Fossil fuels – oil, coal and natural gas – will remain the dominant sources of energy through to 2035, even with the rise of alternatives such as nuclear power and renewables. The IEA projects that in electricity generation, the role of renewables will grow from 19 per cent in 2008 to 32 per cent by 2035.

According to the IEA, China will account for 24.6 per cent of global energy usage in 2035, while the US will drop to 15.5 per cent and India will rise to 5.1 per cent.

India’s per capita usage of energy is very low by world standards, at 531 kg of oil equivalent in 2005, according to a report by KPMG. That compares with 1242 kg for China, 4176 kg for Japan and 7913 kg for the US.

But India’s energy supply base also includes unquantifiable low-grade sources such as firewood and animal dung, which are in wide use in rural communities. As India’s economy continues to grow, and as electricity distribution systems improve and rural incomes rise, these low-grade sources are expected to become less important.