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New Delhi: Coal’s share in India’s electricity mix is projected to fall from over 70% in 2025 to about 60% by 2030, even as the country’s overall coal demand is expected to rise 17% over the next five years, according to the International Energy Agency (IEA).IEA said India’s total coal consumption in 2025 is likely to record a marginal year-on-year decline of 1.2%, driven mainly by a 3% drop in coal-fired power generation. Higher hydropower output following an early and strong monsoon, lower electricity demand for cooling and the continued expansion of renewable energy capacity have contributed to the decline.In 2024, India’s coal production rose 7% to an all-time high of 1,082 million tonnes (MT). While most of the output was thermal coal, India also produced lignite and metallurgical coal. IEA said production growth outpaced demand growth by two percentage points, supporting India’s strategy of cutting coal imports, strengthening energy security, and avoiding supply shortages and price spikes.The report — Coal 2025: Analysis and Forecast to 2030 — said coal remains central to India’s electricity system, with coal use for power generation in 2025 estimated at around 940 MT, accounting for nearly 72% of total coal consumption of 1,297 MT. India’s total installed power generation capacity stood at 495 GW in Aug 2025, comprising 253 GW of coal-fired capacity, including 30 GW of captive plants, 123 GW of solar, 52 GW of wind, and 42 GW of hydropower, along with smaller contributions from gas, nuclear, and other sources.While the govt continues to expand non-fossil generation capacity in line with its 500 GW target for 2030, India commissioned or began trial operations at 20 new coal-fired power plants totalling 14 GW in 2025, with additional capacity under construction, the report said.Madhura Joshi, programme lead for global clean power diplomacy at E3G, said India has made remarkable progress on renewables, with 2025 expected to be a record-breaking year. She said the decline in coal demand alongside rapid renewable growth signals positive momentum for India’s energy transition. Sustaining this pace of renewable and storage expansion, she said, would help India meet its development, growth, energy security and climate goals.IEA noted that non-power coal demand has emerged as the main source of growth in 2025. Industrial coal use is being driven by strong infrastructure activity and steady expansion in the cement and steel sectors. India, the world’s second-largest cement market, is expected to see cement demand grow 5%–6% in 2025 and remain elevated over the medium term.Capacity expansion by major cement producers, rising steel output — particularly through coal-based direct reduced iron — and coal gasification projects are reinforcing coal’s role in India’s industrial growth, underscoring the continued importance of both thermal and metallurgical coal.India’s non-power coal consumption is projected to reach 356 MT in 2025 and rise further to 470 MT by 2030. Overall coal demand is expected to increase 17% by the end of the decade, reaching 1,522 MT, the report said.China, however, remains the dominant force in global coal markets, consuming about 30% more coal than the rest of the world combined. Go to Source
