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Energy Facts Weekly: Currrent Issue
November 6, 2013

IEA recognizes reality: Coal is the path out of poverty in Southeast Asia.

"Coal emerges as the fuel of choice in the power sector ...A shift towards coal is already underway," International Energy Agency describing the growing role of coal in ASEAN nations, 2013

Coal was the backbone of the Industrial Revolution in England during the 19th century, alleviating a time when one out of five babies died in their first year and the average life expectancy was 37. Coal then fueled America’s emergence as an economic force during the late 19th and 20th centuries, Germany’s manufacturing prowess in the early 20th century and Japan’s industrialization during the same period. Coal is now powering the remarkable 21st century socio-economic miracle unfolding in China, where 80% of the global population taken out of poverty in the last 20 years is Chinese. Importantly, this increasing dependence on coal continues apace as India and other developing countries are emerging from the wings to seek a better life for their citizens through coal. The IEA's recent report,"Southeast Asia Outlook, 2013,"documented the expanding role of coal in meeting the energy needs of the 600 million people in ASEAN, whereseven of the 10 nations have a Human Development Index of less than 0.7 compared to .94 in the US and .92 in Germany. In ASEAN:

  • 134 million people have no electricity. 

  • 280 million cook with biomass 

  • 184 million do not have improved sanitation 

  • ASEAN cities are growing at the rate of 6 million people per year

  • The Asia Pacific region has 31% of the world’s coal, compared to 3% of the world’s oil and 8% of the world’s natural gas

ASEAN: Association of Southeast Asian Nations

 ASEAN: Association of Southeast Asian Nations

* Brunei
* Cambodia
* Indonesia
* Lao
* Malaysia
* Myanmar
* Philippines
* Singapore
* Thailand
* Vietnam


The Continuing Rise of Coal Power in ASEAN

“The power sector is fundamental to the energy outlook for Southeast Asia. Electricity demand increases by half by 2020 and to almost 1,900 TWhby 2035.” IEA
 The Continuing Rise of Coal Power in ASEAN

Coal based electricity is the continuing path to human developmentthroughout Asia. China has set the model and India is a fast follower. Now, countries like Vietnam and Indonesia in the ASEAN region are expanding coal consumption to elevate the quality of life and close the gap in societal progress. But the lag is substantial and will require vast amounts of energy. Coal will be the cornerstone of development for decades.

ASEAN Nations Lag on Human Development

ASEAN Nations Lag on Human Development


ASEAN: Expansion of Coal Generating Capacity (2011-2035)

From 2011-2035, coal will not only provide 43% of new generating capacity in ASEAN nations, but will also account for 60% of all incremental power generation.
ASEAN: Expansion of Coal Generating Capacity (2011-2035) 

Importantly for the developing nations in Asia, supercritical coal powerplants are the most affordable means to providing electricity to millions of families suffering from energy deprivation. Rising costs of oil and gas, the high price of renewables and expensive nuclear power all make coal the fuel of choice in the region.

ASEAN: Electricity Generation Costs: 2020-2035

“Gas for power generation will increasingly come from LNG, which in most cases is set to be more expensive than the gas traditionally used in the region.” IEA
ASEAN: Electricity Generation Costs:  2020-2035 


Coal is ASEAN’s Most Important Energy Resource

 Coal is ASEAN’s Most Important Energy Resource
Beyond affordability, the wide availability of coal in Asia is a key reason why the IEA considers coal in ASEAN as “the fuel of choice.”

Urbanization -- By 2050 more than six billion people will live in the world's cities. This unprecedented urbanization will require vast amounts of power, steel, cement and related materials. Cities at this scale cannot be constructed without coal.

ASEAN nations will add 239 million people to urban areas by 2050 – the equivalent of one St. Louis every 19 days for the next 37 years.

Proof is in the pudding --  Coal is continuing to raise the quality of life throughout the world. Consider the case of Indonesia, a nation where coal is the only viable way to reach the 66 million people who do not have access to electricity. Coal has enabled substantial inroads in reducing energy deprivation but the task is far from complete. Nevertheless, millions of Indonesians are benefitting from the rising utilization of coal based energy.

The demonstrated power of coal -- Improving the lives of 250 million Indonesians
The demonstrated power of coal


Affordable investment – The world needs vast amounts of energy going forward. "All of the above" must be more than political rhetoric if we truly follow the spirit of the Copenhagen Accord and meet growing demand and reduce energy deprivation. The ASEAN need for expansion of energy infrastructure will exceed over $700 billion for fossil fuels alone. Coal is a bargain.


ASEAN: Required Cumulative Investment in Fossil Fuel Infrastructure, 2013-2035

 ASEAN: Required Cumulative Investment in Fossil Fuel Infrastructure, 2013-2035
Coal will supply nearly 60% of incremental electricity, but requires just 6% of new fossil fuel investment.

Meeting rising ASEAN energy demand will depend heavily on coal, given declining oil production and the rising cost of natural gas. Incremental demand over the next two decades will exceed 250 million metric tons.

ASEAN Coal Demand per IEA

ASEAN Coal Demand per IEA

Empowering Humanity through Coal

"The importance of coal in the global energy mix is now the highest since 1971. It remains the backbone of electricity generation and has been the fuel underpinning the rapid industrialization of emerging economies, helping to raise living standards and lift hundreds of millions of people out of poverty,” Fatih Birol, Chief Economist, International Energy Agency, 2013

Note: The data from IEA reported here are based on projections from their "New Policies Scenario." The role of coal is even more powerful in the more realistic "Current Policies Scenario."

References: Detailed references available from author. Energy projections and data from IEA, Southeast Asia Energy Outlook, 2013. Livermore National Laboratory Study by Alan Pasternak, first published in 2000.


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About Dr. Clemente

Dr. Frank ClementeDr. Clemente is a Professor Emeritus at Penn State University where he specializes in research on the socioeconomic aspects of energy policy. His work has appeared in World Oil, Public Utilities Fortnightly, Oil & Gas JournalElectric Light & Power and a variety of other energy related media. The materials presented here are solely the responsibility of the author and do not represent Pennsylvania State University in any manner.

About Mark P. Mills

Mark P. MillsMills, a physicist, co-authored the book The Bottomless Well and writes the Forbes "Energy Intelligence" column.  Earlier, he co-authored a successful tech investment newsletter (Digital Power Report), and has been published widely including the Wall Street Journal and New York Times. He has testified before Congress, given hundreds of speeches, and appeared frequently on TV shows, including the Daily Show with Jon Stewart. He worked in the Reagan White House Science Office.

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