Ask Vietnam, Pakistan and even Korea: the era of steam coal is not over yet. Banks don’t want to finance it, big miners are dropping it, and China is migrating to cleaner natural gas. But the shift to green fuels is slow, and Asia’s demand for electricity is outpacing it. That will keep prices lofty for longer than many had forecast.
Thermal coal, burned to generate energy, has few friends in high places. Developed markets like Britain, France and others are phasing it out after the Paris climate agreement, and so too is China, the world’s top consumer. Financing coal is getting tougher too, with large banks under pressure from environmentally conscious investors. Even miners are moving on, with almost no significant new projects in the pipeline. Rio Tinto , one of the world’s largest mining companies, agreed to sell its last coal asset in March.
But even if global appetite is levelling off, the Asian picture is different. In China, where consumption peaked in 2013, deep cuts are taking time. And from Pakistan to the Philippines, the need for more cheap energy means more coal-fired plants, driving regional demand. Read More
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