Coal is important for various reasons.

It was important during the industrial revolution

because it was used to power trains and other vehicles. It is important now as a source of fuel.
Coal consumption grew by 2.5% in 2012, well below the 10-year average of 4.4% but still
the fastest growing fossil fuel. Consumption outside the OECD rose by a below-average
5.4%; Chinese consumption growth was a below-average 6.1%, but China still accounted for
all of the net growth in global coal consumption, and China accounted for more than half of
global coal consumption for the rst time. World proved reserves of coal in 2012 were
sufficient to meet 109 years of global production, by far the largest R/P ratio for any fossil
fuel.

A net total of 20% decrease in world recoverable coal reserves was observed for the past two
decades. This downward trend is observed as most countries downgrading their reserves to
resources because of economic conditions or environmental restrictions rather than deposits
exhaustion although a decline in high quality coal reserves was observed. Another factor to
consider is technology, large amount of coal is unrecoverable or unconventional coal lacking
technology progress and the need to produce clean coal makes it cost intensive. Apart from
this coal producers have reduced the supply well supported by a reduction in demand. The
three main catalysts of the coal regression are the increasing competitiveness of natural gas
and renewable energy, innovations in energy efficiency and the shifting regulatory landscape.
The window for profitable investment in coal mining is closing because of the environmental
legislations and availability of low cost alternative fuels. People are reluctant to use coal for
its after effects. The reliability for investors was on the low as well. Due to the recent boom
in coal exports from China, the coal market is in a state of oversupply that is predicted to last
until at least 2015. The resulting lower prices have put pressure on high-cost producers,
forcing production cuts and the closure of marginal mines. In the last 20 years, the annual
growth in coal demand around the world was most influenced by China and India which
alone accounted for 85 percent of the increase. Excluding their markets, global consumption
of coal has increased by less than 1 percent annually since 1990. Now banks to put limits to
coal financing, India to install solar energy on large scale and China with its proposed ban on
importing low grade coal. These emerging global trends are predictive of a lower dependence
on coal-produced energy in the next few years. There will be a surge to shift the investment
to renewable energy and improving efficiency for petroleum and natural gas.