article: Despite stringent carbon emissions targets in Europe designed to slow global warming and massive investment in renewable energy in China, demand for this most ancient source of energy is greater than ever. In fact, coal was the fastest growing form of energy in the world outside renewables last year, with production up 6% on 2010, twice the rate of increase of gas and more than four times that of oil. Consumption data paints a similar picture, while figures for this year are set to tell the same story. There are a number of drivers behind coal's renaissance, many of which may be short lived. Others will push demand ever higher for decades to come. Coal consumption in Europe, where governments have been at the forefront of the push to curb carbon dioxide emissions, has risen sharply in recent years. Why? Because it's cheap, and getting cheaper all the time. Due to the economic downturn, there has been what Paul McConnell, senior analyst at energy research group Wood Mackenzie, calls a "collapse in industrial demand for energy". This has led to an oversupply of coal, pushing the price down. It has also led to a massive surfeit of CO2 emissions permits, pushing the price of carbon, and therefore the cost of coal production, sharply lower. Equally important, there has been a huge influx of cheap coal from the US, where the discovery of shale gas has provided an even cheaper alternative energy source. The coal has to go somewhere, so it's exported to Europe. Finally, higher non-shale, natural gas prices are making coal an attractive alternative. As Laszlo Varro, head of gas, coal and power markets at the International Energy Agency (IEA), says: "All parameters favour coal." So much so that "coal is [now] being burned as the baseload fuel across most of Europe," says Gareth Carpenter, associate editor at global energy information provider Platts. Germany's decision to scrap all nuclear power and build more coal-fired power stations can only boost production further. Just how long coal's resurgence lasts depends to some extent on the global economic recovery and the ability of governments to implement a system that finally delivers a meaningful carbon price. But, in the meantime, legislation passed more than a decade ago will severely curb coal production over the coming years, according to Mr Varro. The full impact of the EU's Large Combustion Plant Directive, which is designed to reduce local air pollutants, but not in fact carbon dioxide, is about to be felt, meaning a number of inefficient coal plants will be decommissioned. As a result, in five years, coal production capacity "will be considerably lower than today", says Mr Varro. The directive will do nothing, of course, to restrict cheap US imports. But whatever happens to coal production and consumption in Europe, spiralling demand for energy in Asia, in particular China, will ensure that coal production continues to rise significantly over the coming decades. Source: BP. Reserves calculated at current price using current technologies Population growth and the exploding middle classes will see to that - in China
summary: Coal, the dirtiest and most polluting of all the major fossil fuels, is making a comeback.