Asian markets are seen turning to coal for its power generation amidst limited supply and rising gas prices, Fitch Solutions reported.
Fitch projected coal will continue to dominate Asia’s generation mix up to 2027 before it slips slightly below the 50% mark to 49.7%.
Despite this, the report noted that the surge in coal will be short-lived due to developments in renewable energy as well as commitments to climate action.
Non-hydropower renewable in the region alone is slated to grow at an annual average of 9.8% to 3,714 terawatt-hour (TWh) in 2031 from 1,657TWh in end-2021.
“This forecast is backed strongly by increasing support from Asian governments to grow their renewables sector in light of climate commitments and opportunities to attract investors,” the report read in part.
On this note, Fitch maintained its forecast that gas power generation will see strong growth in the long term.
In particular, the sector is seen expanding to 2,212TWh in 2031 from 1,375TWh in end-2021. Its growth will likely be slightly higher in the latter half of the decade at 4.9%, compared to 4.8% annual average from 2022 to 2026.