The world's appetite for coal is set to reach a new high next year before beginning a steady decline, according to a major new energy forecast. The International Energy Agency (IEA) reported on Wednesday, December 17, 2025, that intensifying competition from cleaner power sources will push global coal consumption downward by the end of the decade.
A Record Peak Followed by a Structural Decline
In its authoritative annual report, Coal 2025, the IEA provides a detailed outlook for the fossil fuel. The agency projects that global coal demand in 2025 will rise slightly by about 0.5% from 2024 levels, reaching an all-time high of 8.85 billion tonnes.
However, this new peak is expected to be short-lived. The IEA anticipates that worldwide coal use will stabilize in the following years and then enter a phase of gradual decline. By the year 2030, demand is forecast to fall by approximately 3% below the 2025 peak, dipping even below the consumption level recorded in 2023.
The Power Sector Shift: Renewables and Gas Take Over
The driving force behind this anticipated downturn is a fundamental transformation in the global power sector, which currently accounts for a dominant two-thirds of all coal consumption.
The IEA points to a powerful trio of factors reshaping electricity generation:
- Surging renewable energy capacity from solar and wind.
- Steady expansion of nuclear power in several key markets.
- A huge incoming wave of liquefied natural gas (LNG) supply coming to the international market.
"With renewable capacity surging, nuclear expanding steadily, and a huge wave of liquefied natural gas coming to market, coal-fired power generation is forecast to decline from 2026 onward," the agency stated clearly in its report. This combination will directly displace coal in the energy mix.
Implications for the Global Energy Landscape
The IEA's forecast signals a critical inflection point for the world's most carbon-intensive fuel. The expected decline post-2025 underscores the accelerating structural changes in how nations produce electricity. While coal will remain a significant part of the energy system for years to come, its dominance is being systematically challenged by cleaner and increasingly cost-competitive alternatives.
This transition has profound implications for energy security, commodity markets, and global efforts to meet climate targets. For major coal-producing and consuming nations, the report highlights the growing economic and environmental imperative to diversify their energy portfolios and plan for a future with less reliance on coal.
