Global coal demand in 2025 grew modestly above 2024 levels, rising by only 0.4%, an increase of around 30 million tonnes (or 0.7 EJ). This growth, which was in line with IEA estimates, was significantly below the 1.4% increase seen in 2024 and marked the end of the post-Covid rebound, with global coal demand growth slowing each year since 2021.

Coal use in power generation diverged from recent trends in several regions around the world. In the United States, strong coal use in the power sector supported a 10% rise in demand, reversing the trend of declines in recent years. Meanwhile, in China – by far the world’s biggest coal consumer – electricity generation from coal fell for the first time since 2015. In India, coal-fired electricity generation also declined, mostly due to the impact of an early and strong monsoon. And in the European Union, the long-term decrease in coal use slowed, mostly due to low hydropower and wind output. Together, these trends balanced each other out, resulting in only modest global demand growth over the year.

Coal power generation accounts for two-thirds of coal consumption globally, and therefore is the main driver of coal demand trends. In 2025, coal power generation was basically flat, remaining close to 2024 levels. In the industrial sector, coal demand continued its decline in advanced economies as well as in heavy industry in China, where cement and steel production peaked in 2014 and 2020 respectively. However, this was offset by demand growth in other sectors, with coal increasingly used to produce chemicals in China, steel in India and nickel in Indonesia

China consumes 30% more coal than the rest of the world put together. As a result, it remains the main driver of global demand trends. Overall, coal demand in China in 2025 stayed very close to 2024 levels, recording a slight increase of 0.1%.

While China saw continued strong electricity demand growth in 2025, this was met by a combination of fast growth in solar PV and wind generation, increased hydropower output and growth in nuclear power. As a result, coal electricity generation in China declined by around 1.5% in 2025, falling for only the second time since the 1970s. Coal use in energy-intensive industry in China also declined as steel and cement output shrank by 4% and 7%, respectively. However, these declines were largely offset by an increase in demand for coal for the production of plastics and the chemical sector.

In parallel, the commissioning of coal power plants in China accelerated significantly in 2025, reaching almost 80 gigawatts (GW). This was the result of an elevated number of approvals between 2022 and 2024 following power shortages in 2021. The construction of new plants is primarily intended to meet peak electricity demand and support China’s energy security goals.

In India, an early and intense monsoon had a significant impact on coal power generation, and hence on wider coal demand, with electricity accounting for almost three-quarters of the country’s coal use. The change in the monsoon resulted in weaker electricity demand growth, mainly because of reduced air conditioning and agricultural pump use. In addition, record high rainfall significantly boosted hydropower output, while growth in wind and solar PV continued. As a result, coal-fired power generation in India declined by around 3%, marking only the third decline in five decades. Other sectors partially offset the decline in the power sector. The output of steel – the second-largest coal-consuming sector – grew by more than 10% in 2025. These effects combined to result in an overall decline in coal demand of 1%.

In the United States, where coal use had declined by 16% in 2023 and 5% in 2024, demand grew by 10% in 2025, driven by higher use in the electricity sector, which accounts for almost 90% of US coal consumption. Strong electricity demand and higher gas prices, together with US government support for slowing coal plant retirements, were the major drivers behind this reversal.

In the European Union, coal demand fell by 5% in 2025, a much slower rate than in 2023 and 2024, when consumption declined by 23% and 11%, respectively. Low hydropower and wind output, particularly in the first half of the year, boosted coal-fired power generation. Coal use in the European Union halved over the previous decade, due to factors such as coal plant closures, the growth of renewables and high carbon prices.