Coal’s Global Dominance to Persist Amid Economic and Policy Challenges

Global reliance on coal is unlikely to decline substantially in the near future for several reasons. Coal remains one of the most affordable and widely available energy sources, especially vital for powering industries and providing electricity in developing countries.

Significant investments in coal infrastructure have already been made, prompting countries like India and China to continue relying on coal to meet their expanding energy demands and although there is growing international pressure to transition to cleaner energy, such a shift demands substantial financial resources, time, and technological advances—factors that are currently out of reach for many nations.

Geopolitical interests and internal policy priorities in several countries favor the continued use of coal to maintain energy security and economic stability, making a rapid shift away from coal usage both difficult and unlikely in the short term. Indeed global coal demand increased by 1.5% in 2024, reaching a record high of 8.79 billion tonnes, primarily driven by rising demand in China and India.

Despite advancements in renewable energy, the persistent growth in electricity needs has kept coal-fired power generation at peak levels and experts indicate that the continued reliance on coal hinders the achievement of the 1.5°C climate target established by international agreements. In particular, Asian economies like China, India, and ASEAN countries, which make up about 77% of the global coal demand, continue to heavily utilize coal for power and manufacturing, slowing down the transition towards greener energy sources.

Efforts to phase out coal are lagging, with significant implications for global warming, indicating a need for more decisive action and international cooperation to curb coal consumption and support sustainable development in emerging economies.