Why India is still dependent on coal as UK shovels fossil fuel out

South Asian nation is shifting to clean energy but it is not phasing out the fossil fuel yet

This report has been updated

The United Kingdom (UK) last week shut down its last coal-fired power plant, becoming the first among G7 nations to stop using the fuel for electricity. The UK has met its goal of ending all coal-fired power generation a year earlier than target.

By adopting gas power and penalising carbon emissions, the country gradually reduced its use of coal. It has not added any coal-fired capacity since the beginning of this century. Compare that to China which since 2000 has accounted for 69 per cent of the 1588.5 gigawatt (Gw) coal-powered capacity added globally -- the highest among nations, according to data from the Global Energy Monitor (GEM).

India is a far second, adding 12 per cent of total global capacity.

About 29 per cent of the net coal capacity (the difference between that introduced and retired each year) India has added since 2000 was after the 2015 Paris Agreement on climate. China added about five times more than India in the same period. While Germany added 1.1 Gw of coal capacity, the United States. The United States has not had a new coal power plant since 2016 and its net additions are negative (chart 1)

Of the 29 Gw of coal capacity under construction, 80 per cent is coming up in six states: Tamil Nadu, Uttar Pradesh, Telangana, Jharkhand, Chhattisgarh and Odisha (data as on July 2024).

India’s plan to retire coal power is modest -- less than one Gw of capacity in the next 15 years --compared to advanced economies and those in the BRICS grouping (Brazil, Russia, China and South Africa) (chart 2).

“Rather than plan for a coal phase down, the [Indian] government is currently planning for a coal expansion, saying coal use in the country won't peak until 2040 – the year that coal power should be phased out globally to meet the Paris climate agreement, according to the IEA,” said Christine Shearer, project manager for Global Coal Plant Tracker at GEM.

“The government has asked utilities to hold off on retiring coal plants until 2030 to meet electricity demand, while the coal ministry continues to open new coal blocks for commercial auction,” said Shearer.

India meets most of its electricity demand from thermal power plants though more than half of the installed electric power capacity is from non-fossil fuel sources. The growth rate in electricity generation from fossil fuels in FY24 was the highest in a decade and outpaced that generated from renewables.

Coupling India’s non-fossil targets with “efficiency, flexibility, and increased regional transmission could meet increases in the country’s electricity demand, even during peaks,” said Shearer.

India accounts for 13 per cent of the global coal plant emissions. China’s emissions are five times more than India’s (chart 3).

Problems that coal is supposed to solve, such as power demand during heat waves, are themselves caused by coal and other fossil fuels, according to Shearer.

"The only real solution out of this cycle is to plan a swift transition to clean energy,” she said.