The International Energy Agency (IEA) has released a new report ahead of the COP26 summit in Glasgow, detailing the impacts net zero by 2050 will have on the world’s largest exporter of coal – Australia.
According to the IEA’s latest research, as countries phase out coal use in industry and electricity, Australia’s coal exporters will suffer major consequences.
IEA’s modelling suggests that Australia will remain the largest exporter, although exports would fall by around 5 per cent by 2030, before declining further towards 2050. The modelling illustrates Australia’s customer base shrinking mainly in Japan and Korea, which have historically been important markets for local coal.
However, the IEA warned that as countries jump on the opportunities offered by alternative, low emission fuels such as hydrogen, coal demand could realistically plummet by 55 per cent to 2030.
But global progress towards net zero hinges on individual efforts, the IEA said.
“To achieve net zero pledges, countries in Europe and North America rapidly phase out coal use in industry and electricity and by 2040 almost all coal power plants still in use have been retrofitted,” the report said.
It cautioned that “the transformation still has a long way to go”, especially due to the uneven economic recovery from last year’s COVID-induced recession.
“For all the advances being made by renewables and electric mobility, 2021 is seeing a large rebound in coal and oil use.
“Largely for this reason, it is also seeing the second-largest annual increase in CO2 emissions in history. Public spending on sustainable energy in economic recovery packages has only mobilised around one-third of the investment required to jolt the energy system onto a new set of rails, with the largest shortfall in developing economies that continue to face a pressing public health crisis,” the IEA said.
In the run-up to COP26, more than 50 countries, as well as the entire European Union, have pledged to meet net zero emissions targets, however Australia is not among them.
The Morrison government is currently trying to determine its policy, but expectations are mixed after the Prime Minister termed the net zero goal “aggressive” just last month.
“Australia has not made a final decision on that matter. I will consider it further when I return to Australia,” PM Scott Morrison told media in Washington in September.
Last year, Mr Morrison received a very cool reception by the UN after it decided to block the PM from speaking at the summit, having deemed his climate change policies too weak.
Following the snub, the PM attended the Pacific Island Forum and used this platform to send a message to the UN – instead of committing to net zero by 2050 Australia would chase its own, unspecified, targets.
Maja Garaca Djurdjevic
Maja's career in journalism spans well over a decade across finance, business and politics. Now an experienced editor and reporter across all elements of the financial services sector, prior to joining Momentum Media, Maja reported for several established news outlets in Southeast Europe, scrutinising key processes in post-conflict societies.
