Coal demand hits fresh high as US output rises — IEA

Ben Graham · December 17, 2025

Global coal demand is set to reach a new record high in 2025, driven by higher output in the United States, before flattening and slowly declining by the end of the decade, according to the latest International Energy Agency (IEA) report.

The IEA projects global coal demand will rise 0.5% from 2024 to a record 8.85 billion tonnes this year, even as renewables, nuclear power and plentiful natural gas steadily erode coal’s grip on power generation.

The forecast underlines how hard it remains to quit fossil fuels, despite rapid growth in clean energy.

In the US, coal use is set to jump 8% in 2025, snapping a 15-year stretch of roughly 6% annual declines. Higher natural gas prices, slower retirements of coal-fired plants and federal policy support have lifted output, while weak wind conditions in Europe also blunted efforts there to move away from coal.

“Looking ahead, we observe that global coal demand plateaus and will start a very slow and gradual decline through the end of the decade,” IEA’s director of energy markets and security, Keisuke Sadamori, said.

Crying wolf on peak coal

Calling the peak for coal has repeatedly humbled analysts, including the IEA itself. In 2023, the agency said demand had likely peaked, only to see consumption hit a new record in 2024 and rise again this year, largely because of surging electricity demand in China, India and other fast-growing economies. The latest outlook warns that the five-year forecast remains subject to “significant uncertainties” that could materially change the picture.

The report comes on the heels of the Paris Agreement’s 10-year- anniversary. The pact committed countries to keep global warming well below 2°C above pre-industrial levels, while striving to limit it to 1.5°C.

Recent global analyses show average warming over the past three years has already exceeded 1.5°C, with parts of the Arctic, Central and Eastern Europe, and North America running 3–7°C hotter than pre-industrial times. Whether this overshoot proves brief or lasting will shape social and economic stability for decades.

The United Nations’ 2025 Emissions Gap Report, released in November, says the world is currently on track for about 2.3°C of warming by 2100, even if countries fully deliver on their stated climate commitments.