Record Clean Energy Surge Drives Historic Drop in Coal Power Across China and India

2026-01-13 global

Beijing, Tuesday, 13 January 2026.
For the first time since 1973, coal-fired electricity generation has simultaneously declined in China and India, marking a pivotal shift in the global energy landscape. Data for 2025 indicates a 1.6% drop in China and a 3% decrease in India, driven largely by record-breaking renewable energy installations rather than economic stagnation. China added a staggering 300 GW of solar capacity, while India boosted its green energy additions by 44%. While both nations continue to expand coal capacity for peak demand security, this data suggests that renewables are finally meeting new electricity demand. This historic decoupling signals that a structural peak in thermal coal usage is likely imminent, potentially accelerating global decarbonization timelines significantly.

A Historic Turning Point in Global Generation

The simultaneous contraction of coal output in China and India is a statistical anomaly not seen since the Arab oil embargo of 1973, ending over five decades of consistent growth in thermal power reliance [2][3]. In 2025, coal-fired electricity generation decreased by 1.6% in China and 3.0% in India, representing a reduction of 58 TWh and 57 TWh respectively [2]. This shift occurred despite robust economic activity, challenging the long-held assumption that economic growth in developing Asian economies must strictly correlate with increased fossil fuel consumption. The decline was particularly notable in India, where mild weather and a resulting slowdown in underlying demand complemented the structural shift toward clean energy [3][7].

Renewables Filling the Gap

The primary driver of this reduction was an unprecedented surge in renewable energy installations. In 2025, China alone added approximately 300 GW of solar power and 100 GW of wind power capacity [1]. Consequently, during the first 11 months of the year, China’s power generation from solar and wind surged by 450 TWh, with nuclear contributing an additional 35 TWh [2]. This massive injection of zero-carbon electricity was sufficient to cover the country’s rising power needs, effectively squeezing out coal generation.

The Paradox of Capacity Expansion

Despite the drop in actual generation, both nations continue to expand their coal-fired fleets, driven by energy security concerns and the need to manage peak demand periods. Current analysis suggests that if all under-construction and permitted projects are completed, coal-power capacity could still rise by 28% in China and 23% in India [1][2]. However, the role of these plants is evolving from baseload providers to peaker plants designed to stabilize the grid when renewable output fluctuates [5]. Consequently, utilization rates for coal plants are expected to decline, potentially leading to financial stress for operators as they run for fewer hours [6].

Sources

Energy transition Coal markets