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Stat review finds 2017 emissions increase
Up after 3 years on GDP growth, increased coal use; power sector, producing 1/3 of global emissions, 38% coal-based after 20 years Kristen Nelson Petroleum News
In introducing the BP Statistical Review of World Energy 2018, BP Group Chief Executive Bob Dudley said in a June 13 statement: “2017 was a year where structural forces in the energy market continued to push forward the transition to a lower carbon economy, but where cyclical factors have reversed or slowed some of the gains from prior years. These factors, combined with a rising demand for energy, has resulted in a material increase in carbon emissions following three years of little or no growth.”
In remarks in London Dudley urged focus on the long-term picture rather than the short-term changes. He said the increase in emissions in 2017 was not the direction they wanted to see, noting that some of the recent “exceptional performance” in reduced emissions has been boosted by cyclical developments.
He noted that Spencer Dale, the BP group chief economist, had drawn attention to that likelihood last year.
Emissions increase Along with growth in energy demand, carbon emissions are up, Dale said June 13 in London when introducing BP’s 2017 Statistical Review (see story in June 17 issue), and in the introduction included in the Statistical Review.
He said the increase in carbon emissions is estimated at 1.6 percent in 2017, following three consecutive years of little or no growth, with factors driving the increase in emissions including global GDP growth which was above trend levels, much of which was driven by industrial activity.
The turnaround in coal consumption was also a factor, he said, with the coal market experiencing a mini revival in 2017. Global coal consumption was up 1 percent, led by India, with 4.8 percent growth, with demand both inside and outside the power sector. In China, which had seen three successive years of decline in coal usage, consumption was up 0.5 percent. Dale said this was despite coal-to-gas switching in China for both industrial and residential use.
Dale said that some of the recent performance gains in emissions were boosted by cyclical developments, so some reversal was likely. He said the good news is that structural factors influencing long-term emissions continue to progress, such as the growth in the use of natural gas (see June 17 story).
Coal in China He said coal, which had been in free-fall for several years, “experienced a mini-revival last year,” with coal production up 3.2 percent, driven by increases in China of 3.6 percent and in the U.S. of 6.9 percent, with U.S. production increases mainly going for export.
Dale attributed the 2017 increase in coal production in China to government measures to reduce excess capacity in that country’s coal sector, driven by a need to manage the price of coal: too high and it eliminates pressures for inefficient mines to close or merge and raises energy costs; too low and the price could threaten the coal industry, which provides some 60 percent of China’s energy.
In early 2017 Chinese authorities introduced a target band for steam coal prices, Dale said, indicating ranges where authorities would increase their attention and then ranges where authorities would intervene on domestic coal prices. Because of high prices, Chinese authorities moved to increase coal production to lower prices and the increase in Chinese coal production over the last year was the direct result, he said.
Impact of power sector Dale cited the impact of the power sector, absorbing more than 40 percent of primary energy in 2017, and said this Statistical Review is the first to include comprehensive data on the fuel mix within the power sector. Global power generation was up by 2.8 percent in 2017 which is close to its 10-year average, he said.
While wind energy increased 17 percent and solar 35 percent, renewables accounted for only 8 percent of total generation.
Dale said that what struck him was that coal’s share in power generation is the same as it was in 1998 - 38 percent. In spite of the growth of renewables and strong policy efforts to shift away from coal to cleaner carbon fuels, there has been almost no improvement in the power sector fuel mix in 20 years, he said, noting this was worrying because power generation is the most important source of carbon emissions, accounting for over a third in 2017.
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