Coal-plant retirements in Europe outpace new capacity

12 August 2020

The size of the global coal fleet declined in the first half of 2020 for the first time on record, as plant retirements outpaced the commissioning of new capacity. In the first six months of the year, 18.3 GW of coal-fired power generation came online while 21.1 GW was closed down, signalling a net reduction of 2.9 GW to a total of 2047 GW, according to data gathered by the US-based non-governmental organisation Global Energy Monitor. Until 2019 worldwide coal capacity had grown by an average of 25 GW every six months since 2000.

European countries have made the bulk of the closures this year with 8.3 GW taken offline, followed by the US and China, with reductions of 5.3 GW and 1.7 GW respectively. Many Europe countries are phasing out of coal power as they seek to meet environmental commitments. 

China, which has half of the world’s operational coal fleet and 48% of planned capacity expansions, continues to dominate the global landscape for coal, accounting for 90% of newly-proposed capacity additions in the first half of 2020, as well as 86% of new construction and 62% of plant openings. During the six-month period under review, 11.4 GW of coal-power capacity was brought online in China, while authorities granted permits for 19.7 GW of new coal projects, the highest rate since 2016.

In a guest post for the UK climate think tank Carbon Brief, GEM programme director Dr Christine Shearer warned this trend suggests the country could be looking to new coal development as a stimulus for its post-pandemic rebuilding efforts. 

Effect of coronavirus

The onset of coronavirus throughout the year has led to a significant drop in energy demand, with a 6% contraction expected globally by the end of 2020 according to the International Energy Agency (IEA). Coal demand, in particular, is expected to fall by 8% this year, the biggest drop since the Second World War, as comparatively high operating costs weigh on the sector and renewables enjoy preferential access to major energy grids.

Dr Shearer commented: “The Covid-19 pandemic has paused coal plant development around the world and offers a unique opportunity for countries to reassess their future energy plans and choose the cost-optimal path, which is to replace coal power with clean energy. Such a transition will stimulate economies, create new jobs, and help the world meet global climate goals.”

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