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Southeast Asian coal demand doubles in past decade — IEA

COAL demand in Southeast Asia doubled in the past decade led by Indonesia, with Philippine consumption fourth, according to the International Energy Agency (IEA).

“Coal consumption in Southeast Asia has more than doubled in the last decade, with the largest growth in Indonesia and Vietnam, followed by Malaysia and the Philippines. In 2019, demand in Southeast Asia was 332 MT (million tons), of which 42% was accounted for by Indonesia and 27% by Vietnam,” the IEA said in a report.

According to IEA data, the Philippines used 250 MT in the past decade. In 2019, coal consumption was 30 MT. The Philippines’ coal-fired power plant capacity was 9.6 gigawatts (GW) last year, making the power industry by far the largest user of coal.

According to the Department of Energy (DoE), the Philippines consumed around 33 MT of coal last year.

This year, however, coal demand in the Philippines will fall “for the first time in several years due to the global health emergency, the IEA said.

The IEA’s report on coal, published on Dec. 18, projected that overall coal demand in Southeast Asia will rebound 7% next year as economies recover.

In Indonesia, which consumed 1,001 MT of coal in the past decade, demand is expected to rise after Jakarta ruled that coal producers investing in downstream operations will receive a waiver on royalties, the IEA said.

The IEA said global demand for coal in 2020 will register the “largest drop since the Second World War, falling 5% from its 2019 levels.”

“Coal’s decline is only slightly sharper in power generation than in industrial applications. Except for China, industrial output has been severely subdued by the COVID-19 crisis,” the IEA said.

The European Union (EU) and the US logged a 19% increase and 14% decrease, respectively, in coal-fired power generation. Consumption increased 1.2% in the Asia Pacific region this year, the IEA reported.

It added that by 2025, global coal demand is projected to “flatten out” at 7.4 billion tons, but Southeast Asia will surpass the US and EU to become the third-largest coal-consuming region.

Two months earlier, the Department of Energy (DoE) announced a moratorium on new coal-fired power plant projects, following a recent assessment which showed the need to shift to a “more flexible” power supply mix.

The Institute for Energy Economics and Financial Analysis (IEEFA) said in a November report that around 10GW of greenfield coal plants will be affected by the DoE’s ban.

However, a report by non-government organization Clean Air Asia estimated that power generating capacity from coal-run plants is expected to rise by 135% as soon as the plants which are currently being built became operational. — Angelica Y. Yang

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