Coal’s Share of World Energy Demand at Highest Since 1970

Photographer: Chris Ratcliffe/Bloomberg

Coal is the dirtiest fossil fuel, and use of it expanded at utilities from China to Germany. Close

Coal is the dirtiest fossil fuel, and use of it expanded at utilities from China to Germany.

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Photographer: Chris Ratcliffe/Bloomberg

Coal is the dirtiest fossil fuel, and use of it expanded at utilities from China to Germany.

Coal dominated world energy markets last year by supplying the biggest share of demand since 1970, making it the fastest growing fossil fuel, according to an annual review by BP Plc.

Consumption grew 3 percent last year, driven by coal use in developing nations, according to a statement today from Europe’s third-largest oil company. Use of renewables such as solar and wind also reached a record, accounting for 2.7 percent of all energy demand.

The findings are another indication that consumers are prioritizing cheap fuels over efforts to rein in greenhouse gas emissions blamed for global warming. Coal is the dirtiest fossil fuel, and use of it expanded at utilities from China to Germany.

“Europe is increasing its carbon emissions because it’s using too much coal because it’s cheap,” Royal Dutch Shell Plc’s Chief Financial Officer Simon Henry said in an interview on Bloomberg Television June 3.

Coal’s share of global energy use reached 30.1 percent, just below the 32.9 percent share for crude oil, which lost market share for a 14th consecutive year. China was the world’s biggest coal consumer, followed by the U.S. and India.

China’s Coal

In China, coal accounted for 67.5 percent of the total energy demand, the lowest on record because of new measures to combat pollution. Carbon dioxide emissions from fossil fuels use grew by 4.2 percent, or 358 million metric tons, the slowest in five years, the report showed.

“The big story in coal markets is China,” Christof Ruehl, BP’s chief economist, said today at a presentation in Moscow. “New policies to combat local pollution by shutting down coal-intensive production and encouraging coal substitution may have played a part” in cutting the fuel’s dominance to the lowest on record.

Natural gas consumption rose 1.4 percent, below the historical average of 2.6 percent, to account for 23.7 percent of world primary energy use. Gas demand growth was below average everywhere but North America, where hydraulic fracturing technology opened new supplies.

That so-called fracking technique also helped boost oil supply in the U.S., which had record output, a trend that will continue this year, Ruehl said.

Oil Supply

Disruptions in oil-producing nations such as Libya, Sudan and Nigeria were offset by the increase in U.S. production from shale and other “tight” geological formations where supplies are difficult to extract with traditional techniques.

“This underlines the importance of continuing to secure these new supplies through continued access to new resources, policies to encourage markets and investment, and the application of new technologies worldwide,” BP’s Chief Executive Officer Bob Dudley said in the statement.

Worldwide, energy consumption rose 2.3 percent in 2013, faster than the 1.8 percent pace of the year before but below the 10-year average of 2.5 percent, BP said. Emerging economies accounted for 80 percent of demand growth.

China’s energy consumption rose by 4.7 percent, below the 10-year average of 8.6 percent, BP said.

To contact the reporter on this story: Nidaa Bakhsh in London at nbakhsh@bloomberg.net

To contact the editors responsible for this story: Will Kennedy at wkennedy3@bloomberg.net Reed Landberg, Tony Barrett

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