The past six months have delivered a very sharp reminder about the importance of dependable energy, because it has never been more apparent that energy security delivers national security.
Despite some noise to the contrary, global coal consumption reached a new record high in 2025 of 8.85 billion tonnes. The ongoing unrest in the Middle East has only further emphasised our reliance on fossil fuels like coal, gas, and oil.
Coal Australia has been actively advocating to highlight these realities and to support our coal mining communities – and there is no doubt that sentiment is shifting back to a much greater understanding of the relevance and importance of coal to the Australian economy.
As a net exporter of coal, we have more than enough product to satisfy our domestic demand, while being a reliable trading partner for many near neighbours which are ramping up their reliance on coal.
Countries like Japan, South Korea, Vietnam, and the Philippines are among those taking steps to expand their capacity for coal-fired power generation – Japan remains the largest market for quality thermal coal from NSW.
India’s industrial expansion and growing steel production continues to depend on our world-class steel-making coal and Australia remained India’s largest supplier of metallurgical coal throughout 2025 – China and India combined now account for nearly 70 per-cent of the world’s steel production. Japan is also a vital customer for Australian steel-making coal, and many Japanese ventures have taken equity stakes in local operations in Australia.
China now burns around 56 percent of the world’s coal as enormous volumes continue flowing into both electricity generation, steel manufacturing, and fuel production. Across the OECD, there has been an increase in the reliance on coal-fired power generation.
And those in the vanguard of the renewables or nothing mantra are now having second thoughts – yes, there will be a transition over time, but it cannot be at any cost. Germany has now woken to the stark reality on this front.
It has long pursued some of the world’s most ambitious climate targets, but those policy settings have come at a cost and German households are now paying electricity prices of up to 37 cents per kilowatt hour – more than 9 cents above the broader European Union average.
Germany’s Economic Affairs and Energy Minister, Katherina Reiche, recently stated, “an energy transition that ignores system costs will ruin the country it claims to save”.
In Australia, coal continues to generate the majority of electricity flowing into the east coast energy market, while the timelines for key coal-fired power stations have been extended in both Victoria and New South Wales.
The NSW government’s recently updated coal strategy confirmed that coal generated close to 60 per-cent of the state’s electricity supply over the past financial year.
During periods of evening peak demand through summer, coal accounted for as much as 85 per-cent of electricity into the NSW National Electricity Market.
The lifespan of Australia’s largest coal-fired power station, Eraring, has been extended for a second time amid growing concerns about the national grid’s ability to meet future demand; this is particularly so against the backdrop of a rapid build-out of energy hungry data centres.
These developments reflect a broader recognition that affordable and dependable baseload power remains critical, and quality Australian coal is central to this.
Modelling by Arche Energy shows coal is the cheapest and most reliable form of baseload electricity generation — the Queensland government’s Energy Roadmap 2025 plans to use more coal, for longer, while the federal opposition has recently made the ongoing reliance on coal a central plank of its budget reply speech.
These are inconvenient truths for many detractors and the many challenges faced by our sector are central to Coal Australia’s work.
Queensland continues to have the highest coal royalty rates in the world. The latest government data shows the mining industry paid $74 billion in taxes and royalties over the past year, while job losses and mine closures continue across parts of the industry.
Andrew Boyd, who heads up QMetco, a member of Coal Australia, recently delivered some sobering observations on the regime at the Queensland Futures Institute Resources Forum.
He noted that Queensland’s coal export volumes last year were around 30 million tonnes lower than they were a decade ago – despite global demand for steelmaking coal increasing by approximately 10 percent over the same period.
In New South Wales, environmental approvals, increasing regulatory complexity and policy duplication also remain key areas of focus for Coal Australia.
Later this year there will be a review of the Commonwealth Safeguard Mechanism which imposes obligations on coal miners to reduce their emissions – it could go even further.
In New South Wales, emissions from coal mining are declining at a faster rate than the state average. This highlights yet another inconvenient truth for the activists.
At a time of such global unrest there is a real sense that as a nation we should avoid any further uncertainty for our coal producers, and the communities that support them.
Coal Australia’s work has never been more important — our Friends of Coal movement has now grown to more than 135,000 supporters across the country.
We have reached this major milestone in under two years. These are Australians who recognise the importance of affordable and reliable energy and the enormous contribution coal mining communities make across the country.
The global reality around coal is stark. Demand for Australian coal remains strong, global demand is at record highs, dependable and affordable energy has never been more important, and Australia’s coal mining communities continue to underpin economies both here and abroad.
Coal Australia will continue working to ensure these issues remain front and centre, as we work to continue the shift in sentiment in support of coal.
