- Asia’s coal dependence is strengthening as countries like China, India, and Indonesia expand their coal capacity due to concerns over energy security.
- Efforts to phase out coal early, such as Indonesia’s Cirebon-1 project, are stalling due to insufficient financing and political support.
Asia’s reliance on coal is deepening as major economies prioritise energy security over climate goals. Indonesia has cancelled its flagship early-retirement coal project, India is considering further expansion of its coal fleet beyond 2035, and China continues to increase coal production to meet rising industrial demand despite strong growth in renewables.
Governments across the region face fast-rising electricity demand driven by population growth, higher incomes, and the surge in AI data centres. As renewable installations struggle to keep pace, coal and gas are filling the gap, prompting new approvals for coal plants.
China plans to add approximately 80 gigawatts of coal capacity annually through 2027, while India is expected to increase its coal-fired capacity by nearly 90% by 2047. Indonesia has more than doubled its coal power capacity in the past decade and still plans further expansion. Together, these three nations account for the most significant increase in global coal emissions since the Paris Agreement.
Efforts to transition away from coal remain slow. Funding through partnerships like the Just Energy Transition Partnership has fallen short, resulting in the cancellation of early-closure plans, such as Cirebon-1. Meanwhile, new schemes like Singapore-backed transition credits face concerns over emissions credibility and job losses.
Although renewable energy costs continue to fall, the region remains cautious about early coal plant retirements due to the risk of power shortages. Analysts note that coal’s dominance could eventually decline if China, India, and Indonesia meet their renewable targets, potentially causing emissions to peak by the end of the decade. However, for now, coal remains deeply embedded in Asia’s energy strategy.