The world is building more coal-fired power plants than in 10 years

The world is on the verge of seeing the largest number of new coal-fired power plants commissioned in a decade. In 2025, new coal-fired electricity generation capacity is expected to reach its highest level since 2015, according to a recent report. Paradoxically, this increase in construction is not translating into a rise in electricity production, which is even tending to decrease. This complex situation raises questions about the future of global energy and the effectiveness of climate policies.

A record number of new coal-fired power plants

Data compiled by researchers reveal a worrying trend: over 30 gigawatts (GW) of new coal-based generation capacity are expected to be added in 2025. This figure represents the highest level since 2015, a year when the world was still far from the commitments made during the Paris Agreement. The bulk of this new capacity is concentrated in Asia, with China and India leading the way, followed by other countries such as Vietnam, Indonesia, and Pakistan. These nations rely on coal to meet growing energy demand, often driven by energy security and cost considerations.

Why is electricity production declining despite everything?

Despite the influx of new power plants, total coal-fired electricity production has seen a slight decrease. Several factors explain this phenomenon. Firstly, many power plants built in recent years are smaller and less efficient than their predecessors, or are intended for less intensive use, serving as backup capacity rather than continuous production. Secondly, competition from renewable energies, particularly solar and wind, is increasingly strong. The costs of these energy sources are falling drastically, making them more competitive, even for baseload power in some regions. Finally, some of these new power plants, although built, are not yet fully operational or are running at reduced capacity, awaiting stronger demand or grid stability.

The historical weight of coal in the energy landscape

Coal has long been the backbone of the industrial revolution and global electricity production. For decades, it provided abundant and relatively cheap energy, enabling the economic growth of many nations. However, its environmental cost has become increasingly evident, particularly with its major contribution to greenhouse gas emissions. This new wave of construction, while representing a decadal peak, comes in a context where the world is actively seeking to move away from fossil fuels. It reflects the persistent challenges faced by developing countries in balancing economic growth, energy security, and climate imperatives, often in a delicate equilibrium between immediate needs and long-term commitments.

AI to the rescue of climate and energy forecasts?

In this context, artificial intelligence (AI) and predictive models play an increasingly crucial role. Neural networks and machine learning algorithms can analyze enormous volumes of atmospheric and climate data from satellite and ground-based stations. Models like GraphCast, developed by institutions such as ECMWF (European Centre for Medium-Range Weather Forecasts), or Huawei's Pangu-Weather, are capable of predicting weather conditions with unprecedented accuracy and speed. These advances are essential for anticipating fluctuations in renewable energy production (wind, sun) and optimizing their integration into the electricity grid. AI can thus help better manage demand, identify times when coal may still be needed, but also model the impacts of new energy infrastructure on the climate.

A major obstacle for climate goals

The construction of these new coal-fired power plants is bad news for the fight against climate change. Coal is the most carbon dioxide (CO2) emitting fossil fuel per unit of electricity produced. Each new operational power plant represents decades of additional emissions, making it more difficult to achieve the goals set by the Paris Agreement, which aims to limit global warming to well below 2°C, and if possible to 1.5°C, compared to pre-industrial levels. The International Energy Agency (IEA) has repeatedly warned about the need to stop building new coal-fired power plants to achieve these goals. Uncertainty in forecasting long-term energy demand and the financing of these projects, often supported by public investment or development banks, are major issues.

Strategic stakes behind maintaining coal

The decision to build new coal-fired power plants, even if their use is expected to decline, responds to strategic imperatives for the countries concerned. It is often about ensuring stable and predictable electricity generation capacity, essential for economic development and social stability, in a context where renewable energies, while growing, can still suffer from intermittency. Coal offers a degree of resilience against fluctuations in international fossil fuel markets and can be a local resource. Furthermore, the construction of these power plants can represent a local economic lever, creating jobs and stimulating national industry. These factors explain why, despite climate warnings, coal retains a place in the energy mix of certain nations, posing a major challenge for the global transition.

Towards a complex and nuanced energy transition

This situation highlights the complexity of the global energy transition. While renewable energies are progressing rapidly, global energy demand continues to rise, particularly in emerging economies. Coal, despite its environmental drawbacks, remains an energy source perceived as reliable and relatively cheap by many countries. AI-based predictive models, if used correctly, could help better assess real needs and accelerate the deployment of low-carbon alternatives. However, the political decision to move away from fossil fuels remains paramount. The ability of AI models to simulate future scenarios and quantify the impacts of different energy policies could prove decisive in guiding future decisions and avoiding investment in infrastructure that will become obsolete before the end of its lifespan, while continuing to pollute.

In summary

Carbon Brief's report reveals a paradoxical trend: a 10-year peak in the construction of new coal-fired power plants, reaching over 30 GW in 2025, mainly in Asia, while observing a decrease in overall coal-fired electricity production. This situation is explained by increased competition from renewables, less intensive use of some power plants, and their potential role as backup. Historically a pillar of industry, coal remains a strategic choice for some countries to ensure their energy security and economic development, despite its environmental impact. The fight against climate change is thus hampered, making it more difficult to achieve the goals of the Paris Agreement. Artificial intelligence offers new tools to better forecast demand and optimize the integration of renewable energies, but the political decision to move away from fossil fuels remains essential for a successful energy transition.

Source: Carbon Brief