Tony Hayward,
CEO, BP
 
14 June 2010 – Oil giant, BP, said on Wednesday that for the first time since 2002, hydropower ousted coal last year as the fastest growing fuel in the world.

Hydropower took its place, after the OECD demand for coal dropped by 10,4% in 2009 – the steepest decline on record, according to the BP Statistical Review of World Energy.

“China became a large-scale coal importer, which prevented global coal consumption from falling,” CEO Tony Hayward said.

This was after China accounted for 46,9% of global coal consumption, while producing 45,6% of global supplies during 2009, the BP report said. The US accounted for 15,8% of production, while South Africa represented 4,1% of global coal production.

World primary energy consumption, including oil, natural gas, coal, nuclear and hydro power – fell by 1,1% in 2009. This was the first drop since 1982. Energy use in OECD countries declined by 5% – the biggest ever fall.

The BP report said the significant demand shrinkages for coal in OECD states and the former Soviet Union were owing to the recession and competitively priced natural gas.

“In the OECD, energy consumption fell faster than GDP – the sharpest decline in energy consumption on record,” said Hayward. “The OECD consumed less primary energy last year than 10 years ago, although GDP since then has risen by 18%.”

BP noted that coal remains the most abundant fossil fuel by global reserves, and accounted for 29% of total energy consumption last year.

In November, the International Energy Association said energy demand would resume its long-term upward trend once the economic recovery gathered pace. “By 2030 the reference scenario…sees world primary energy demand a dramatic 40% higher than in 2007.”

The IEA forecast in its World Energy Outlook that from 2007-2030, global demand for coal would grow by 53%, greater than demand increases for both natural gas and oil.

The World Coal Institute forecast the use of coal would rise by 60% over the next 20 years. Coal currently accounts for 26% of world primary energy, second only to oil, with 34%.

The BP report does not include solar power as a fuel, but last month the France-based International Energy Agency (IEA) said energy from the sun could represent up to 20% to 25% of global electricity production by 2050.

"The combination of solar photovoltaics and concentrating solar power offers considerable prospects for enhancing energy security while reducing energy-related CO2 emissions by almost six billion tonnes a year by 2050,"  IEA director Nobuo Tanaka said.

Meanwhile, United Nations climate change incoming chief Christiana Figueres warned on Wednesday it could take until 2050 to build the machinery that will cut out greenhouse gases.

"I continue to be confident that governments will meet this challenge, for the simple reason that humanity must meet the challenge. We just don’t have another option," Figueres was quoted as saying.

Countries including Australia, Norway, the US, Germany and China have launched carbon-capture and storage plants at coal-fired power stations. The first pilot plant was launched in Germany in 2008.

Richards Bay, South Africa, Coal prices have rebounded to around $94/ton, according to globalCOAL.