Global coal consumption is projected to hit an all-time high in 2023, according to a report released by the International Energy Agency (IEA) on Friday. The demand for coal is expected to rise by 1.4 percent, surpassing 8.5 billion tonnes for the first time, driven by strong demand in emerging and developing economies such as India and China.

The IEA report highlights that coal usage in India is projected to grow by 8 percent, while China's usage is anticipated to increase by 5 percent. These increases can be attributed to rising electricity demand and weak hydropower output in both countries. China alone accounts for half of the world's coal consumption, making its energy policies and economic shifts crucial factors in determining the future of coal.

Coal remains the largest source of CO2 emissions, along with other greenhouse gases, responsible for global warming. However, the report reveals a contrasting trend in the European Union and the United States, where coal use is forecasted to decline by approximately 20 percent this year.

The future of coal consumption in Russia, the fourth-largest consumer of coal, is uncertain due to the ongoing conflict in Ukraine. The IEA states that it is difficult to forecast coal demand in this region.

Despite the anticipated decline in coal consumption starting in 2026, driven by the expansion of renewable energy capacity, the report warns that global consumption is expected to remain above 8 billion tonnes by that time. Meeting the goals outlined in the Paris climate agreement would require a faster reduction in the use of unabated coal.

At the United Nations COP28 climate talks held in Dubai this week, world leaders reached an agreement to transition away from fossil fuels in order to mitigate the worst effects of climate change. However, the agreement falls short of a complete "phase-out" of fossil fuels, a demand made by more than 100 nations. Instead, the agreement emphasizes a "transitioning away from fossil fuels in energy systems, in a just, orderly, and equitable manner."

Experts believe that the absence of explicit "phase-out" language in the agreement sends a less definitive message about the need for a total shift away from fossil fuels. Harjeet Singh, head of global political strategy at Climate Action Network International, highlights that a stronger and more measurable commitment is essential for achieving the energy transition required to combat climate change effectively.