China and India Lead Global Coal Power Expansion in 2025

China and India Lead Global Coal Power Expansion in 2025

The first half of 2025 has highlighted a striking global energy divide. While Europe and Latin America continue to phase out coal, China and India account for nearly 88% of the new coal power capacity proposed worldwide. This trend demonstrates the complex challenge of balancing energy security, economic growth, and climate goals in major developing economies.

China’s Coal Capacity Surge

China remains the largest driver of coal expansion, adding 21 gigawatts (GW) of coal power in just six months, the biggest increase since 2016. This push comes in response to the 2021–22 energy crisis, which exposed vulnerabilities in the country’s power supply.

Interestingly, despite the coal surge, China’s carbon emissions fell by around 1% in early 2025, mainly due to accelerated growth in solar, wind, and hydropower. Many of the new coal plants are designed as standby capacity, operating during peak demand rather than full-time. This reflects Beijing’s cautious approach—maintaining coal as a safeguard while pursuing an aggressive renewable strategy.

India’s Dual Energy Strategy

India is following a dual energy path—simultaneously scaling up renewables while strengthening coal. By March 2025, the country’s renewable capacity crossed 220 GW, advancing towards its 2030 target of 500 GW. However, coal still provides about 70% of India’s electricity.

In the first half of 2025, India commissioned 5.1 GW of new coal plants, up from 4.2 GW in 2024. At the same time, nearly 92 GW of coal capacity proposals are pending, which could result in a 60% increase in coal capacity over earlier targets. Plant retirements are slow, with only 0.8 GW phased out in 2025, partly due to delays in enforcing pollution control measures.

This dual approach—rapid renewable expansion alongside continued reliance on coal—underscores India’s need to balance energy security with developmental demands.

Global Regional Contrasts

The contrast between Asia and other regions is stark.

• Europe: Ireland shut down its last coal plant in June 2025, joining a growing list of EU countries planning complete coal phase-outs between 2029 and 2033.
• Latin America: The region has almost completely stopped pursuing new coal projects, focusing instead on clean energy investments.

This widening gap poses a challenge to global climate efforts, especially the Paris Agreement target of limiting warming to 1.5°C. Without curbing new coal development in Asia, global climate goals remain at risk.

Energy Security vs. Climate Goals

China and India’s strategies highlight the non-linear path of energy transitions in large developing economies.

• For China, coal ensures grid stability and industrial resilience.
• For India, coal remains essential for baseload electricity, supporting rapid urbanization and economic growth.

At the same time, both countries are investing heavily in renewable energy, reflecting a dual-track model where coal and renewables coexist. This balancing act is not a rejection of climate commitments but a pragmatic response to energy realities.

The choices China and India make in the coming decade will significantly shape global carbon emissions and climate outcomes.