Coal bounces back, probably briefly, as economies rebound

"Coal use is surging in some of the world’s largest economies as electricity demand rebounds from the pandemic, illustrating the challenges to countries looking to wean themselves off the dirty but reliable fossil fuel," Sarah McFarlane and Katherine Blunt report for The Wall Street Journal. "Coal was in decline for years in many countries, but its use is now picking up in the U.S., China and Europe despite growing pressure from governments, investors and environmentalists to curb carbon emissions. The leading reason for the uptick—which has pushed coal prices to multiyear highs—is rising power demand as economies reopen rapidly from pandemic hibernation."

Analysts and executives agree that coal's resurgence probably won't last, but it highlights the world's continued reliance on fossil fuels while renewable-energy capacity hasn't yet grown robust enough, McFarlane and Blunt report.

"Countries have spent billions adding renewable-power capacity at record rates, but solar and wind projects generate electricity only when the sun is shining or the wind is blowing, and can’t be ramped up when demand rises," McFarlane and Blunt report. "Those limitations mean the world is still reliant on fossil fuels, especially when there is a surge in electricity demand. Analysts say this will remain the case until more renewable capacity is added, along with storage such as batteries."