Coal Crisis and the World

The COVID-19 has still some of the nations in its grasp. And while some refuse to kneel to this problem, they have started to begin the old ways to live. And India is one among many such nations. This phase, in which we are bringing back the life is post-pandemic and this is what led to something that the Indian Govt. and the world, were completely unaware of. While many of us are unaware of the global crisis that we are facing, many who know are questioning authorities. This is coal crisis. Yes! The world is now losing its most popular and feasible resource that runs the planet.


September 21, 2021, Addressing the UN General Assembly, China stated that it will stop funding its projects in the world. This was the first sign in the history of China to accept the scarcity of resources. Covering the statement Xi said “China will step up support for other developing countries in developing green and low carbon energy and will not build new coal-fired power projects abroad. We should foster new growth drivers in the post-Covid era and jointly achieve leapfrog development, staying committed to harmony between man and nature.”

On a visit to China earlier this September, US climate envoy John Kerry said the United States has made it “clear that the addition of more coal plants represents a significant challenge to the efforts of the world to deal with the climate crisis. China has promised to peak coal consumption by 2030 and go carbon neutral by 2060.” But that didn’t take along. Guess 2060 is already here!

Resulting in complete blackout and scarcity of coal, Xi has put forth its declaration to ramp the mining of coal and boost it as soon as possible.

Coal crisis-BusinessWisdomToday
Coal usage to generate electricity.


The Federation of IMI (Indian Mineral Industries) told the Ministry about Coal on Wednesday that the coal scarcity has created “an enormously hazardous scenario for coal users, namely the iron & ore sector,” and also that the predicament might lead to factory closures. Advising the Central Electricity Authority (CEA) of India last Thursday that coal supplies at more than half of the nation’s power stations might run out in 3 days or less due to a post-pandemic increase in industrial consumption that struck power providers unaware.

Major states such as New Delhi, Punjab, Rajasthan, Bihar, Jharkhand, Tamil Nadu, Andhra Pradesh are acute in coal supply.

Reasons for coal crisis:

  • Heavy rains in coal mine areas like Gujarat, Punjab, Rajasthan, Delhi, and Tamil Nadu
  • Increase in prices of imported coal from $60/ton in March-2021 to $160/ton (in Sept /Oct 2021)
  • Inadequate coal stocks built before monsoon season
  • 43.6% reduction in power generation from imported coal which led to extra demand of 17.4 MT of domestic coal
  • Increase in power demand from 106.6 BU per month in 2019 to 124.2 BU per month in 2021.
  • Other issues like payments dues by some coal mining companies, fall in coal imports by 40%, climate change


Being obvious to get impacted by the factors of the rest of the world, the US has gained the cost of oil because of the coal crisis and production cost. Power production has struggled to cope with a significant rise in consumption in the midst of the coronavirus slump, as energy companies strive to increase supply while demand has swiftly rebounded. During 2019/2020, the economic cycle slowdown and collapse in energy costs induced by the pandemic, as well as the prior trade war between the United States and China, reduced investment across the energy industry.

Limited access to finance, an uncertain demand forecast, labor constraints, and the time it takes to expand supply are among the reasons miners in the long-struggling industry have not increased production.

Front-month gas futures prices have risen 140% in the United States, more than 500% in Europe, and more than 600% in Northeast Asia, compared with the same time last year.

According to American Electric Power Co. Inc. representative Scott Blake, coal stocks are limited since providers have acclimated to reduced demand over the years, and the COVID-19 epidemic and other challenges have made expanding production numbers difficult.

Blake stated, “We are doing everything we can to sustain supply levels at our plants,” adding that American Electric is working with its suppliers to guarantee coal remains accessible.

Read: Apple launches a new headquarter in LA


Amid the coal crisis, Europe is not having a good time as well. UK, Spain, Germany, Italy, France, Switzerland, Netherland, and probably everyone is facing the risk to run the life in absence of resources and energy.

Europe is experiencing an energy shortage as gasoline prices rise, the need for fossil energy rises, and as winter is approaching, making fuel & resources availability are far more critical. The European Union (EU) is pursuing more fuel supply from Russian energy company Gazprom. Europe’s major provider, supplying two-thirds of the country’s necessities. The price of natural gas here in the region has steadily risen over the last year, with the European guideline up nearly 600 percent as of Thursday.

The price plummeted to $120.79 per MW/h early Thursday. On Tuesday, the prior value was $134 per MW/h. As Russian President Vladimir Putin announced the government may offer gas to European interim customers through its internal market.


Globally, governments of the different nations had taken multiple actions to curb this scarcity. Majorly the element that was supposed to be used was “Solar.” But they couldn’t make it happen as per their plan.

Coal crisis-BusinessWisdomToday
Usage of Solar PCs to generate electricity in MWs. Source: Wikipedia

While China consumes most of the coal, it also has implanted solar plants throughout the nation to generate electricity the most. Followed by European Union and the United States. Renewable energy accounted for 42.4 percent of total Chinese capacity, or 934 GW. The goal should be met by the end of the 2030 five-year plan, which spans from 2021 to 2025, according to NEA officials. At the end of last year, renewable energy accounted for 42.4 percent of total Chinese capacity, or 934 GW.

China’s sustainable energy mix, according to the NEA, comprises hydro, solar, wind, and biomass electricity. However, certain renewables, particularly solar and wind, have a poor utilization rate.

In a recent report, the evaluated result of India led to awestruck many and question the govt. As the targeted solar-generated electricity was around 175 Gigawatt by 2022. But the nation accomplished 46.3GW renewable capacity is under implementation in February 2021 and tendered another 35.1GW.

Not to be outdone, the White House on Wednesday unveiled a plan for renewable energy, mainly for solar, to supply over 50% of the state’s power by 2050, on September 2nd, 2021. Solar will rise from 3% of total generation in 2020 to 40 percent by 2035, and then to 45 percent by 2050, according to the elaborate plan.


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