A report from a UK-based online journal that covers climate and energy policy said that coal-fired power generation worldwide will fall by 3% this year, to about 54% of global electricity output.

The report from Carbon Brief, released Nov. 25, was written by researchers from climate research groups including the Centre for Research on Energy and Clean Air (CREA). Researchers noted that the global decline comes despite increases in coal-fired generation capacity in regions such as China and Southeast Asia.

“The global average utilization of coal-fired power plants is on track to hit an all-time low this year, affecting the profitability of both existing and planned capacity,” wrote Lauri Myllyvirta, a lead analyst for CREA and one of the authors of the report. “Such a low utilization rate also implies that the electricity they generate is more expensive, as capital costs are paid for by output during fewer running hours.”

Carbon Brief said this year’s drop is equal to about 300 TWh. The report suggests the decline is driven by coal plant closures in the U.S. and Europe, including large plants such as the 2,250-MW Navajo Generating Station near Page, Arizona, that closed Nov. 18. The 3% drop would be the largest year-over-year decline in coal-fired generation on record, according to the report.

The U.S. Energy Information Administration (EIA) earlier this year said that between 2010 and the first quarter of 2019, U.S. power generators announced the retirement of about 550 coal-fired power units, accounting for about 102 GW of generation capacity.

India’s Generation Falls for First Time in Decades

The researchers also wrote that India will see coal-fired generation drop in 2019 for the first time in “at least three decades,” while China’s generation will stabilize. China and India generate more power from coal than any other countries, and together account for about 60% of global electricity output from coal.

Along with Myllyvirta, other authors of the study include Dave Jones, an analyst at the non-profit Sandbag, and Tim Buckley, director of Australia energy finance studies at the Institute for Energy Economics & Financial Analysis.

The researchers also wrote that a 3% increase in global carbon dioxide emissions from power generation was responsible for 50% of the world’s increase in emissions from all sources.

The report noted that increased power generation from cleaner sources such as solar and wind also contributed to coal’s decline.

Coal Markets Look for Support

Industry analysts have said that global coal markets will be increasingly dependent on China and India as other countries phase out coal-fired generation. According to Reuters, China’s domestic production of coal is rising this year, increasing 4.5% to 3.06 billion tonnes over the first 10 months of this year compared to the same period in 2018. China also is importing more coal; data shows the country’s coal imports could exceed 300 million tonnes this year, having increased 9.6% year-over-year through October.

It’s been a different story in India. State-owned Coal India reported production of 280.36 million tonnes from April through October, off 8.5% year-over-year. The company on its website reported production of 39.35 million tonnes in October, up from a six-year low in September, but still off about 21% from October 2018.

India still is expected to import at least as much coal this year as it did in 2018. Refinitiv, a UK-based financial markets data company, reported India imported 169.7 million tonnes of coal from January through October, putting the 2018 total of 195.3 million tonnes within reach. About half of India’s coal imports are used to power the cement and steel manufacturing industries.

The top four coal-exporting ports in the U.S. saw declines in shipments from the second to third quarter of this year, according to S&P Global Market Intelligence. The group said U.S. coal companies shipped 24.3% fewer tonnes of coal abroad year-over-year in the third quarter, with shipments falling to 20.1 million tonnes.

Eight U.S. coal companies have filed for bankruptcy protection in the past year, despite efforts by the Trump administration to prop up U.S. coal producers. Dan Brouillette, who is expected to be confirmed as the new Energy Secretary when the Senate returns to Washington, D.C., in December after the Thanksgiving break, said earlier this year that U.S. coal and nuclear plants were “retiring at an alarming rate.”

Brouillette said “one of DOE’s foremost priorities is stopping the loss of these critical resources,” but he has not said whether he would support government action to subsidize coal and nuclear plants. A plan for subsidies put forth by Brouillette’s predecessor, Rick Perry, was rejected in early 2018 by the Federal Energy Regulatory Commission.

Darrell Proctor is a POWER associate (@DarrellProctor1, @POWERmagazine).