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Energy Transitions and the Future of Thermal Coal

Policy Memo
July 2019

Coal power generation is in decline globally, not only because of responses to the increasing urgency of climate change, but also because the costs of clean energy are dropping, renewables are becoming more efficient, and fossil fuel markets are beginning to falter. The conversation internationally has shifted from whether coal will need to be phased out to when and how. Retaining or growing investment in coal will carry major macroeconomic risks as markets shift domestically and globally.

Countries will take different approaches to structural change and face their own specific obstacles, but in any context, early preparation will ensure smoother, more equitable transitions. Policy opportunities for shifting to clean energy are growing and examples from early movers can help governments better understand how to approach their own just transition.

When raising the move to renewable energy systems on the agenda, in addition to aligning with the Paris Agreement targets, entry points for policymakers include: increasing energy access; ensuring fair transition for affected workers during labor market adjustments; reducing stranded asset risk; and managing balance of payments. The Powering Past Coal Alliance and various regional and subnational exchanges provide opportunities for countries and communities to seek out international assistance and support.

Background materials can be downloaded from:

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