European seaborne coal imports seen rising 14% this year

European seaborne coal imports were likely to rise by 12m tonnes this year to 98m tonnes due to an energy crisis that has primarily squeezed gas supply, consultancy Wood Mackenzie said on Wednesday. The company identified an additional 9 GW of coal-fired capacity that had been made available to supplant generation from natural gas. Only around half of this capacity had returned to the market, with the rest retained for emergency back-up in case of power shortages.

“Coal prices are surging but they are still more affordable than record-high gas prices,” said the consultancy’s senior research analyst Adam Woods in a statement.

Short-term event
“While this scenario has made for a slight resurgence, we believe that this will be a relatively short-term event and we do not see companies making major investments to increase infrastructure or long-term production.”

Europe’s gas imports from Russia, its main supplier until this year, have collapsed amid worsening relations with Moscow over its war on Ukraine.

Wood Mackenzie expected elevated European coal burn to last until at least the middle of this decade before receding.

“Imported higher quality coal generation will still be phased out completely by the end of the decade, although lower quality domestic lignite generation could extend much further,” Woods said. The German government aims to close its last coal plant by 2038. The Greens had planned to seek an earlier date of 2030 to align with climate goals as part of their governing coalition agreement.