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An ironic sidelight of the ongoing COP26 climate conference is that financial investors in coal, the largest source of CO2 emissions from fuel combustion, haven’t experienced better returns in a long time. A report in this paper pointed out that Coal (Australia) delivered returns of 188% since last Diwali, on the back of a surge in demand. This peculiar phenomenon is in the spotlight as on November 4, a number of COP26 participants issued a statement identifying coal power generation as the single biggest cause of global temperature increases and pledged to help in an orderly transition to other sources of electricity generation.

Coal remains the bedrock of global electricity generation. The International Energy Agency says that it fires up almost 37% of global electricity generation. A dirty fallout of it and other uses of coal is that it comprised 44% of all CO2 emissions from fuel combustion in 2019, the single largest source. That begs the question: Will our coal dependence undermine the net-zero visions laid out at COP26?

Very unlikely. Coal’s current surge in demand is an outcome of disruptions catalysed by Covid-19. Global coal production fell by 4.8% in 2020. Since then, the fast-paced return to normalcy has exacerbated shortages. It’s the rise in the contribution of renewables to power supply that underpins net-zero visions. IEA data shows that renewables contributed 29% of global power supply in 2020 and are the source that’s growing fast. The coal sidelight may not be anything more than a blip.



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This piece appeared as an editorial opinion in the print edition of The Times of India.



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