For the first time in decades, China burned less coal in 2025
China’s electricity generation from coal declined by 1.9% in 2025, marking a historic turning point as growth in non-fossil energy sources surpassed rising power demand, according to a recent report.
According to a report by Wood Mckinsie, an analytics firm specialized in the energy sector, electricity consumption in China increased by 5% in 2025, equivalent to an additional 494 terawatt-hours. For the first time in ten years, however, coal-fired generation did not expand to cover the higher demand. Instead, the incremental needs were met by carbon-free sources, supported by the rapid expansion of renewable energy and steady increases in nuclear and hydropower capacity.
In addition to renewables, China’s nuclear capacity has grown significantly, rising from 27 gigawatts in 2015 to 62 gigawatts today. Combined with hydropower, total capacity from these two sources now stands at 445 gigawatts. The country has also made substantial investments in transmission infrastructure, building 340 gigawatts of inter-regional power transmission corridors. These links connect renewable resources located in western and northern regions to major population and industrial hubs in the east and south, enabling the integration of clean energy that might otherwise remain underutilized in sparsely populated areas.
The report noted that coal-fired power plants operated at a capacity factor of approximately 60% in 2011. That figure declined to 52% in 2024 and fell further to 48.2% in 2025. The consultancy projects utilization rates could drop to 32% by 2035 as portions of the fleet shift into reserve roles. Rather than serving as primary electricity providers, coal plants are increasingly being repositioned to offer grid flexibility, with roughly 600 gigawatts undergoing retrofits to better balance intermittent renewable generation.
China’s coal turning point might not last, though. Factors such as the rapid expansion of artificial intelligence may increase power consumption, potentially returning coal power to its growth era. Such disruptions are not unique for China, of course, Europe had to reactivate its coal power plants in recent years after geopolitical factors caused its gas imports to plummet.
Wood Mackenzie estimates that total data center capacity will reach 78 gigawatts by 2030, representing a 105% increase from 38 gigawatts in 2024. Because much of this new demand is expected to be concentrated in densely populated urban areas, coal-fired power could remain critical to ensuring grid stability.
