NEW DELHI: For the first time in more than half a century, coal-power generation in India has not grown over a two-year period even as electricity demand rose, according to a new analysis by the Centre for Research on Energy and Clean Air (CREA). The clean energy added 70 TWh of generation between the first half of 2024 and the first half of 2026 and covered more than 63 TWh, or 7 per cent, rise in demand.
As a result, power-sector carbon dioxide emissions in the first half of 2026 were back at the level of two years earlier, with a 2.2 per cent decline in the first half of 2025 reversed by a 2.3 per cent rise this year. India’s total emissions nevertheless grew by 3.7 per cent year-on-year during the same period, driven by steel, cement and other industries.
The shift has also eased pressure on imports, with the use of imported coal in power generation falling 38 per cent and gas by 35 per cent over the two years, while oil consumption fell 1.3 per cent year-on-year, its second consecutive annual decline, reducing India’s exposure to the Hormuz crisis.
The analysis finds that clean-energy growth is now large enough to meet all of India’s power-demand growth, but sustaining it will depend on upgrading transmission to reduce curtailment, making coal plants more flexible, and building out energy storage, with around 272 GWh tendered against 7.5 GWh of battery storage in operation today.
“For two years, all of the growth in India’s electricity demand has been met by clean energy, and that has halted the rise of coal power for the first time in half a century," Lauri Myllyvirta, lead analyst at CREA.
"The challenge now is industry, where coal dominates and electricity makes up a smaller share of energy use than in almost any other G20 economy, so unless steel and other energy-intensive manufacturers begin to electrify, rising output will keep pushing India’s total emissions up even as the power sector stabilises,” said the lead analyst.
The findings also point to continued investment across the coal supply chain, including coal gasification and domestic coking coal, which could lock in coal use in industry for decades.
“Gujarat, Rajasthan and Tamil Nadu show that new solar and wind can directly replace fossil generation at the state level, but keeping that going depends on transmission upgrades, a coal-flexibility plan that is already more than a year late and the timely delivery of the storage capacity that has been tendered," said Anubha Agg, India analyst at CREA.
"With 43 GW of coal plants still under construction and fresh bets on coal gasification and domestic coking coal, India risks tying itself to coal just as clean energy has shown it can meet the country’s new demand,” Agg said.
