The main driver of this decline was a 4% reduction in gas-fired power generation, driven by supply constraints and higher prices resulting from the blockade. Although coal was expected to fill the gap, CREA data show global coal-fired generation remained largely unchanged. The global power system’s resilience during this crisis is reportedly due to record renewable energy expansion in 2025 which provided a buffer.

In March, solar power generation rose by 14% and wind by 8%. The new solar and wind capacity added in 2025 now generates twice the electricity previously supplied by LNG through the Strait of Hormuz. Excluding China, CREA reports the move away from fossil fuels was even stronger. In countries with real-time data, coal-fired power fell by 3.5% and gas-fired power by 4% in March, both offset by increased renewable generation.

CREA reports no significant increase in coal capacity and no decommissioned units were returned to service or had retirements delayed in March. A key economic factor limiting coal’s resurgence is that plants were already operating near maximum capacity before the crisis. Because coal is less expensive to operate than gas, these plants were already heavily used, leaving little room for further increases. The study uses near-real-time data covering 87% of global coal power and over 60% of gas-fired generation, including China, the US, the European Union and India.

Seaborne coal trade data reinforced that trend. According to analytics company Kpler, global seaborne coal transport volumes fell by 3% year-on-year in March, reaching their lowest level since 2021. This drop reflects reduced demand, not a supply disruption. Regionally, coal shipments to China and India fell by 9% and to South Korea by 4%. Türkiye and Vietnam saw even larger drops in coal imports, down 25% and 27% respectively, reflecting shifts in energy dynamics. In the US and India, solar power expansion was the main driver of reduced fossil fuel electricity generation. In India, non-fossil capacity rose rapidly, reaching 52.25% of total installed capacity by early 2026.

European countries like the Netherlands and Germany also made significant progress, with wind power making the largest contribution to displacing fossil fuels. In other countries, reductions in fossil fuel generation had more varied causes. In South Africa and Türkiye, improved operation of existing nuclear and hydropower plants drove declines, showing that diverse clean energy portfolios strengthen energy security.

While most major economies reduced coal use, CREA data show that Japan and South Korea were exceptions, recording significant increases in coal-fired power. The report notes these increases were due to weak nuclear output, not the global gas crisis. In China, coal-fired generation rose by 2% in March as coastal generators switched from gas to coal due to high prices. Despite this, coal generation remained well below 2024 levels, following a 6% decline in March 2025.

The Strait of Hormuz closure is accelerating demand for clean technologies, according to CREA. Governments are responding with ambitious new policy targets. Indonesia has established a task force for a 100 GW solar initiative, while Vietnam has revised its energy plans to further reduce reliance on coal and aims to have renewables make up 47% of installed capacity by 2030. Türkiye pledged to invest $80bn in renewable energy by 2035 to reach its 120 GW target and India’s Ministry of New & Renewable Energy (MNRE) has set a target to auction 50 GW of renewable energy capacity every year through 2028.

Lauri Myllyvirta, Lead Analyst at CREA, said that record clean power growth has mitigated the recent fossil fuel crisis. Myllyvirta noted that increased clean electricity generation prevented a projected surge in coal use that could have threatened climate goals. The data suggest the current crisis is making fossil fuels permanently more expensive than clean energy and storage.

Read the full analysis here.