Save for later Print Download Share LinkedIn Twitter UN climate talks in Glasgow later this year have been billed as the most important since the negotiations that delivered the Paris Agreement in 2015. The outcome could have a major impact on the tone of the energy transition, encouraging state and nonstate actors to deliver new decarbonization strategies. A coal phaseout is a key part of the battle against climate change. Meeting in the UK earlier this month, leaders of the world's seven richest nations committed to phase out coal at home and stop financing coal overseas. Environmentalists were disappointed, saying G7 leaders didn't go far enough. They will be even more dismayed by what's happening in some of the world's biggest power markets. Coal use has been increasing this year as high natural gas prices discourage coal-to-gas switching, pushing up emissions. In Asia, LNG spot prices are now around $12 per million Btu, over four times higher than year-ago levels -- and their highest for this time of year in more than six years. European hub prices are over four times higher, too. The price of US benchmark Henry Hub has doubled (related). The International Energy Agency said earlier this year it expected global coal demand to rebound in 2021 to near its 2014 peak, largely because of post-Covid-19 economic recovery in Asia. But it also forecast that higher gas prices would lead to some switching back to coal even in developed economies with tough climate targets. It was right. In the EU, industry lobby group Eurocoal said it identified a significant first-quarter rebound. Lignite (brown coal) demand in Germany, the bloc's biggest power market, jumped nearly a quarter year on year. In the US, the latest short-term outlook from the Energy Information Administration sees gas' share of power generation falling to 36% in 2021 from 39% in 2020, and coal's rising to 23% from 20%. But it's trends in the world's biggest coal consumer that could wreak most damage on global decarbonization efforts. Chinese President Xi Jinping announced last September that the country's carbon emissions would peak in 2030 and it would achieve carbon neutrality by 2060 (WGI Feb.24'21). But economic growth remains a priority -- and that depends largely on coal power. Coal still accounts for nearly two-thirds of China's electricity output, despite coal-to-gas switching policies that have boosted LNG demand, and inroads by renewables. Recent warnings that lack of generation capacity and economic recovery could lead to power shortages in five key provinces this summer are prompting Beijing to make energy security, rather than decarbonization, the priority. Local authorities in southern China are already maxing out on coal-fired generation because of shortages caused by a combination of hot, dry weather and an economic rebound. The situation is worst in Guangdong province -- an economic powerhouse and manufacturing hub -- where many factories are having to shut for several days a week. The country last year built more than triple the amount of new coal capacity as the rest of the world combined, according to US-based Global Energy Monitor. The amount under development is nearly six times Germanyʼs entire coal-fired fleet -- and the shortages lend ammunition to those that want to build even more.