Overview
The energy crisis triggered by the Iran conflict in 2025–2026 has sparked widespread speculation about a global "return to coal." Media headlines warn of nations scrambling back to coal-fired power as gas supplies dwindle. However, a detailed analysis by the thinktank Ember—shared exclusively with Carbon Brief—reveals a far more nuanced reality: any increase in coal generation will be minimal and short-lived. This tutorial breaks down the key factors behind this limited rebound, explains how to interpret national energy policies, and highlights why clean energy remains the dominant long-term trend. By the end, you will understand why the anticipated coal comeback is more of a minor blip than a seismic shift.
Prerequisites
Before diving into the analysis, ensure you have a basic grasp of these concepts:
- LNG and gas markets: Liquefied natural gas (LNG) is a key global commodity; the Strait of Hormuz carries about 20% of global LNG trade.
- Coal-fired power plants: Understand baseload generation and how coal plants can be ramped up relatively quickly compared to gas turbines.
- Energy transition context: Familiarity with the declining cost of renewables and the structural decline of coal in many regions (e.g., EU coal phase-out plans).
- Data sources: Ember’s analysis provides a “worst-case” scenario; separate real-time data from energy agencies tracks actual generation.
No specialized technical knowledge is required—this guide is accessible to energy enthusiasts, analysts, and policymakers alike.
Step-by-Step Analysis: Why Coal’s 2026 Rebound Is Overhyped
Step 1: Understanding the Global Gas Disruption
The Iran conflict led to US-Israeli attacks on Iranian facilities, prompting Iran to block the Strait of Hormuz—a vital chokepoint in the Persian Gulf. Normally, about one-fifth of the world’s LNG passes through this strait, primarily destined for Asian markets. The blockade effectively removed this supply from the market, causing a sharp price spike and constraining available gas volumes.
Key nuance: While the Strait carries a large share of LNG trade, LNG itself is only a fraction of total global gas supply. Most gas moves via pipelines (e.g., from Russia to Europe). Therefore, the disruption is significant for LNG-dependent Asian economies, but less so for regions relying on pipeline gas. This concentration explains why only a handful of countries—primarily in Asia—have announced plans to increase coal use.
Step 2: Assessing National Responses
At least eight countries have publicly stated intentions to boost coal-fired generation or delay coal phase-outs:
- Japan: Major LNG importer; announced plans to restart idle coal units.
- South Korea: Increased coal dispatch orders during peak demand.
- Bangladesh, Philippines, Thailand, Pakistan: Reopened coal tenders and extended plant lifetimes.
- Germany, Italy: Temporarily delayed coal exit deadlines.
These announcements triggered global media coverage framing a “return to coal.” However, it’s critical to separate intention from actual generation. Ember’s analysis shows that even in a worst-case scenario, the global increase in coal power output in 2026 will be no more than 1.8%—and real-world data suggests it could be even lower.
Step 3: Evaluating the Actual Impact on Coal Generation
To gauge real-world outcomes, look at actual generation data rather than policy announcements. Separate data from energy agencies shows that, as of 2026, there has been no measurable “return to coal” in global electricity generation. The projected rise of 1.8% is small compared to historical swings (e.g., EU coal spikes in 2022 after Russia’s invasion of Ukraine were similarly short-lived).
Key factors limiting the rebound:
- Global electricity demand growth slowing: Economic headwinds and energy efficiency gains are reducing overall power needs, offsetting any switch to coal.
- Decline in some regions: Even as a few countries burn more coal, others (e.g., the US, EU member states) are continuing their structural decline, driven by cheap renewables and coal plant retirements.
- Clean energy competitiveness: Solar and wind remain cheaper than running existing coal plants in many markets. The energy crisis has actually accelerated renewable investments as a hedge against fossil fuel volatility.
Experts quoted by Carbon Brief note: “The big story isn’t about a coal comeback. Any increase is merely masking a longer-term structural decline.” Clean-energy projects are emerging as more appealing investments precisely because of the fossil-fuel-driven crisis.
Step 4: Recognizing the Structural Decline
The 2022 precedent is instructive. After Russia’s invasion of Ukraine, many predicted a surge in European coal use due to disrupted Russian gas supplies. Indeed, EU coal generation spiked in 2022—but then fell to a historic low by 2025, resuming its “terminal decline.” The same pattern is playing out now: a temporary, politically driven uptick that does not reverse the long-term trend.
Key structural drivers against coal:
- Climate policies and net-zero targets (e.g., EU’s coal phase-out, China’s peak coal pledge).
- Cheaper renewables + battery storage.
- Financial de-risking: Investors are avoiding coal assets due to stranded asset risk.
Even in the eight countries announcing increased coal use, implementation lags mean that actual generation may not materialize as planned. For instance, Japan’s restart of idle units requires regulatory approval and may be temporary.
Common Mistakes
- Mistake 1: Treating announcements as actual data. Many analyses mistake policy statements (plans to increase coal) with actual generation increases. Always cross-reference with real-time energy statistics (e.g., Ember’s Global Electricity Review).
- Mistake 2: Ignoring regional variation. The “return to coal” narrative lumps all countries together, but the increase is concentrated in a few Asian nations. Meanwhile, coal use is falling in Europe, North America, and even parts of China.
- Mistake 3: Overlooking the gas-to-coal price spread. Even with high gas prices, coal is not always cheaper when factoring in transport, carbon costs, and plant efficiency. Many utilities will only switch if economics strongly favor coal.
- Mistake 4: Forgetting the 2022 precedent. The EU’s 2022 coal spike was temporary. Assuming the same pattern won’t repeat ignores historical evidence.
- Mistake 5: Underestimating renewables momentum. The energy crisis has spurred record renewable installations. In 2025–2026, solar and wind capacity additions are at all-time highs, directly displacing fossil generation.
Summary
Despite the Iran conflict disrupting global gas supplies and prompting several Asian and European countries to announce coal-power expansions, the actual rebound in coal generation in 2026 is expected to be minimal—at most a 1.8% global increase, and likely lower. This short-term blip does not signify a reversal of coal’s structural decline. Clean-energy investments are accelerating, and the 2022 precedent shows that such spikes are temporary. The key takeaway: do not confuse political rhetoric with reality. Coal’s future remains dim, and the energy transition is firmly on track.