The International Energy Agency's announcement that China overtook the United States as the world's largest power-consuming nation in 2009 is promising news for coal producers. While other nations are turning away from coal power, it accounted for 70 percent of China's total energy consumption last year. And, even with China's National Energy Administration predicting coal consumption will supply only 63 percent of the country's energy by 2015, investor and analysts are still bullish about coal in China.
By Desmond McMahon — Exclusive to Coal Investing News. When the International Energy Agency (IEA) announced that China overtook the United States as the world's largest power-consuming nation for 2009, it highlighted the tremendous growth of energy consumption in China. Just 10 years ago, the United States, which had been the world's largest consumer for over 100 years, consumed twice the amount of energy as China. The importance of the IEA's announcement isn't lost on the chairman and CEO of the world's largest private-sector coal company, Peabody Energy's (NYSE: BTU) Gregory Broyce. Even if China is denying the report's findings, it cannot deny its economy's rapid growth. And, while other nations are turning away form coal, it supplied 70 percent of China's total energy consumption last year and Broyce expects China's hunger for coal to continue to grow even as energy supply diversifies. China's National Energy Administration is predicting coal-based power will supply only 63 percent of the country's energy, down 7 percent, by 2015. But if China's consistent 8 to 10 percent GDP growth continues - and Broyce doesn't see any signs of it slowing - demand for coal will continue to rise. Broyce pointed to China's recently announced $30-billion investment to continue expansion of its power grid as one sign of continued growth for energy demand. He also noted China has ground to make up in steel-intensity-per-capita numbers where it is lagging far behind countries like Japan, South Korea and the United States. Here too Broyce expects China to become the world leader as auto sales continue to expand, more high-density housing is built, and China's economy and urban population continue to grow.