The News
Coal reserves are piling up to record levels at US power plants, an indication of the financial and environmental consequences of the country’s energy transition. Meanwhile, demand for the fossil fuel outside of the US and Europe has soared.
About 138 million tons of coal are sitting unburned at US power plants, according to federal data. At the current average burn rate — falling every year as coal is replaced by cleaner renewables and cheaper natural gas — US utilities are sitting on about half a year’s worth of unused coal, which they are contractually obligated to buy from mines even when they don’t need it.
The unwanted inventory is worth at least $6.5 billion, the US Institute for Energy Economics and Financial Analysis estimates, a drain on utilities’ resources at a time when most are under pressure to ramp up spending on the energy transition and supply power-hungry data centers. It’s also forcing some utilities to expand the footprint of their coal storage facilities, raising the risk of local pollution.
Know More
At the same time, the global coal demand reached a record 8.77 billion metric tons this year, according to a new International Energy Agency report. The rise can be seen especially in India, which is now seeing levels of coal demand growth previously only observed in China.
The IEA expects demand to level off starting next year — but it warns that the slow pace of carbon capture deployment means emissions from coal consumption will remain high for years to come.
