Energy Transitions and the Future of Thermal Coal

SUMMARY: The report draws on the experiences of various countries, including China, Canada, Indonesia, Germany, Asia, and South Africa, and the EU to analyse energy transitions and the future of thermal coal. The paper investigates the decline of thermal coal in the EU and USA and its dominance in China, and the experiences in Germany’s transition process, highlighting the need for region-specific agendas and policies cognisant of different markets. In exploring the transition, the paper looks at the structural changes and measures needed to ensure smooth and effective coal transitions.

KEY FINDING / RECOMMENDATIONS: Coal has become a risky and unfavourable area of investment in comparison to renewable energy due to economic and environmental pressures. As the demand for coal exports decline, many coal-dependent economies will begin to prioritise domestic industries and guard against international price fluctuations, leaving coal exporters exposed to downward market trends and the national energy policies of international partners.