09/02/26
Coal's share in global generation mix to slip: IEA
Singapore, 9 February (Argus) — Global power demand is set to grow by more than
3 pc/yr on average over the rest of this decade, but coal's share of the
generation mix is likely to be eroded by gains in nuclear, renewables and
natural gas, said the International Energy Agency's (IEA) Electricity 2026
report. Global power demand growth continues to rise rapidly, supported by the
increasing electrification of industry, transportation and the buildings
sectors, the report released on 6 February said. Growing consumption is also
coming from some of the most dynamic segments of global economies, such as AI,
data centres and evolving technological innovations, it added. The share of
renewables and nuclear in the world's power mix rising to 50pc by the end of
this decade, with natural gas also growing, according to IEA forecasts. "Global
electricity generation from renewables — boosted by record deployment of solar
photovoltaic (PV) — is now in the process of overtaking generation from coal,
after virtually drawing level with it in 2025." Coal accounted for around 33pc
of the global energy mix in 2025. Emerging economies continue to be the main
pillar of demand growth, accounting for nearly 80pc of additional electricity
consumption through 2030, the report said. India and southeast Asia are
increasingly set to drive rising energy demand over the coming decade, but China
is forecast to remain the single largest contributor to global electricity
demand growth through 2030, accounting for close to 50pc of the increase. "The
momentum behind low-emissions sources of generation continues to 2030, by which
time renewables and nuclear are together set to generate 50pc of global
electricity, up from 42pc today," the report said. Renewable output will grow by
about 1,000TWh annually through 2030, with solar PV alone accounting for over
600 TWh, the IEA forecasts. This means that renewable generation is forecast to
rise at a rate of 8 pc/yr in percentage terms. Globally, coal-fired generation
remained broadly flat in 2025, but regional trends diverged in ways not seen in
previous years, the IEA said. Coal use declined in India and China due to slower
electricity demand growth and the rapid expansion of renewable, the report said.
But coal use increased in the US given higher natural gas prices compared with
2024 and a slowdown in the retirement of coal plants, supported by federal
policy, which promoted the power sector to raise coal use, it added. In the EU,
record solar generation was partially offset by weak hydropower and wind output,
limiting the overall decline in coal use. A forecast decline in coal's share of
the global energy mix in the coming years is in line with projections made in
the IEA's Coal 2025 report, released in December 2025. Coal demand likely
reached a plateau in 2025 , that report previously said. But global coal demand
could rise above the forecasts, should China post faster-than-expected growth in
electricity consumption, slower integration of renewables or strong investment
in coal gasification, the IEA previously said. China, India import less coal in
2025 China's thermal coal imports fell for the first time in three years in 2025
on weak demand and ample availability of domestic coal. China, the world's
largest thermal coal importer, received 356.6mn t in 2025, down by 12pc on the
year, according to customs data released last month. But China's new and
reactivated coal power project proposals and coal power capacity additions hit
record highs in 2025 despite a decline in coal power generation, according to a
report published by independent research organisation the Centre for Research on
Energy and Clean Air (CREA) and non-governmental organisation Global Energy
Monitor (GEM) in February 2026. New and reactivated Chinese coal power project
proposals totalled 161GW in 2025, hitting a record high. The country started up
a total of 78GW of coal power capacity in 2025, marking the highest level in a
decade. Meanwhile, Indian imports of thermal coal declined for the second
straight year in 2025 , given that weak demand from power utilities and higher
domestic coal output continued to weigh on buying activity. India, which is the
world's second-largest thermal coal importer, received 160.15mn t of thermal
coal in 2025, down by 3pc, or 5.2mn t, from a year earlier, according to data
released by shipbroker Interocean last month. In its latest report, the IEA said
that "The Age of Electricity" requires a fast and efficient expansion of grids
and system flexibility to securely and cost-effectively integrate a changing mix
of generation, demand and storage. Newer sources of demand, such as electric
vehicles, heat pumps and highly concentrated loads, such as data centres, are
expected to grow rapidly. At the same time, more than 2,500 GW worth of
projects, encompassing renewables, storage and projects with large loads, remain
stalled in grid connection queues worldwide due to a lag in funding, the IEA
said. By Andrew Jones Send comments and request more information at
feedback@argusmedia.com Copyright © 2026. Argus Media group . All rights
reserved.
