Coal in the crosshairs in Europe but fuelling emerging markets

Companies, banks and investment funds, primarily European, have been coming out in recent weeks with announcements they will halt investments in coal, a new front in efforts to reduce use of the highly polluting fuel that faces a battle against the hunger for power in emerging markets.
The latest move came Friday, when Norway's parliament voted to force its sovereign wealth fund -- the world's biggest -- to pull out of firms that are heavily involved with coal.
Earlier in the week, French energy group Total announced it would withdraw from its coal activities, notably in South Africa where it is involved in the production and sale of the fuel which is important for electricity in numerous countries around the world.

However it will be difficult to counter the fact that emerging market nations, particularly China, rely heaving on coal for meeting their growing need for electricity.
Coal accounted for 73 per cent of the electricity production in China at the end of the last year.
The International Energy Agency estimated in December that coal demand will continue to grow by an average of 2.1 per cent through 2019, even if this is slower than the 3.3 per cent average recorded in 2010-2013.

"We have heard many pledges and policies aimed at mitigating climate change, but over the next five years they will mostly fail to arrest the growth in coal demand," IEA Executive Director Maria van der Hoeven said at the time.

Even if Chinese authorities want to reduce coal use to improve air quality, the IEA estimated that China would account for three-fifths of the increase in coal demand through 2019.
"The country has announced 500 gigawatts of coal-fired power stations in the years to come," said Nathalie Desbrosses, head of energy market research at Enerdata.
That is the equivalent of more than 500 nuclear reactors.
Other emerging market nations are following on China's heels.
India, which is investing massively to expand its electricity output, saw coal use jump by 11 per cent last year after rising by nearly seven percent in 2013.

Last year it passed the United States in coal consumption by volume to account for 74 per cent of electricity generation.
Increasing reluctance by Western banks to fund coal mining projects has failed to curb India's coal drive.
Earlier this year India's Adani Group brushed aside a decision by a dozen European and US banks not to fund huge coal industry projects in Australia's Galilee Basin near the Great Barrier Reef, saying it had "no bearing" on the company.