Energy Crisis Prompts Several Countries to Increase Coal Use

Rising gas prices and supply disruptions linked to the Middle East crisis are prompting countries including India, South Korea, Germany, and Italy to rely more on coal for energy security. Governments that previously pledged to phase out coal are delaying shutdowns, extending plant lifetimes, or restarting reserve coal facilities to stabilize grids and control energy costs.

Five years ago, over 40 countries pledged to scale back and phase down unabated coal power at the COP26 UN Climate Summit by 2030-2040, with hundreds of institutions promising to end international coal financing. Three years later, the Group of Seven nations, namely the United States, UK, Canada, France, Germany, Italy, and Japan, officially agreed to exit from unabated coal power generation between 2030 and 2035.

Global demand for coal as a primary power source is surging again, thanks to the ongoing energy crisis triggered by the war in Iran, with countries that previously prioritized cleaner energy reversing course and utilizing coal as a reliable, cost-effective option. Despite coal's comeback, renewables remain structurally cheaper in many markets.