In 2025, the United States reversed its progress on emissions reductions. Meanwhile, China and India, the two largest developing economies, both saw coal power generation drop for the first time in over 50 years. That’s the bad news and good news that point to a challenging future.
The Rhodium Group’s preliminary 2025 U.S. greenhouse gas emissions analysis reports that after two years of declining emissions, the U.S. produced 2.4% more planet-warming CO2 pollution last year. More concerning was that emissions grew faster than the economy, which expanded just 1.9%, reversing three years of successfully decoupling economic growth from carbon output.
Electric utilities were responsible for the majority of the increase. Surging electricity demand from data centers and cryptocurrency mining operations drove overall consumption higher. They burned 13% more coal to keep up, their emissions rising 3.8% compared to 2024. That’s only the second time in the past decade that coal generation has grown. High natural gas prices, which rose by 58% at Henry Hub, an important gas distribution facility, made coal economically competitive again.
Emissions from U.S. buildings increased by 6.8% due to colder winter weather. Transportation emissions remained about the same despite record travel, thanks to more people buying hybrid and electric cars, which accounted for nearly 22% of passenger car sales as of November 2025.
The Policy Shadow Over America’s Future
Although Trump administration policies did not affect 2025 emissions, Rhodium expects the consequences of its hostility toward renewable energy to become evident soon.
According to Rhodium’s Taking Stock 2025 report, by 2035, U.S. emissions are expected to fall only 26-35% below 2005 levels, far below last year’s forecast of up to 56% reductions. That’s the Trump Effect at work, and in the firm’s worst-case scenario, the pace of emissions reductions could fall to just 0.4% per year, down by two-thirds from the U.S. historical progress. The key reasons for the change include Congress’s budget bill, which changed clean energy tax credits, and the Trump Administration’s rollbacks of climate rules, including the repeal of methane standards for oil and gas.
BloombergNEF estimates that new wind, solar, and energy storage projects will decline by 23% through 2030 compared to earlier forecasts. Onshore wind has been hit hardest, with a 50% cut in expected growth. New Treasury rules also added more hurdles for clean energy project developers.
Despite these attacks on the technology, clean energy remained strong last year. Solar power grew by 34%, its fastest rate since 2017, and now 42% of the U.S. electric grid is carbon-free. According to the U.S. Solar Market Insight Q4 2025 report from SEIA and Wood Mackenzie, solar and storage accounted for 85% of new power added to the grid in the first nine months of the Trump administration.
Asia’s Historic Coal Turning Point
In Asia, the situation was different. Carbon Brief reports that coal power generation dropped in both China and India in 2025, the first time this has happened since 1973. China’s coal output fell by 1.6% and India’s dropped by 3%. The change will result in measurable climate progress. China and India were responsible for over 90% of the increased global carbon emissions between 2015 and 2024.
China delivered progress despite its electricity demand growing by 5%. The country added record levels of renewable energy; over 500 gigawatts of solar and wind are expected in the final tally for 2025. Carbon Brief also reported that China’s CO2 emissions have stayed flat or dropped since March 2024. More electric vehicles cut transport emissions by 5% year over year, and emissions from cement and steel fell as Chinese real estate construction slowed.
India increased its clean energy capacity by 44% year over year, adding 35 gigawatts of solar, 6 gigawatts of wind, and 3.5 gigawatts of hydropower in the first 11 months of 2025. For the first time, clean energy growth was a major driver of the drop in India’s coal power, accounting for 44% of the reduction, with milder weather and slower demand growth also helping.
Even though their coal emissions are down, China and India continue to build new coal plants. Carbon Brief reports that the two countries added 87% of the new coal power capacity added worldwide in the first half of 2025. China proposed 74.7 gigawatts of new coal, India 12.8 gigawatts, and the rest of the world only about 11 gigawatts combined. Many new coal facilities are meant to serve as backup or “peaker” plants, running only during periods of high demand.
Global Emissions Hit Record High
The Global Carbon Project’s 2025 Global Carbon Budget put these trends in perspective: global fossil fuel CO2 emissions rose by 1.1% to a record 38.1 billion tons. The United States contributed about 40% of the global increase, more than the EU, China, and India combined.
China’s emissions in 2025 are expected to rise by only 0.4%, slower than in recent years due to its aggressive investments in renewable energy. India’s emissions growth also slowed to 1.4%, helped by an early monsoon that reduced cooling needs and more renewables that limited coal use.
What This Means for Climate Goals
These different trends have big consequences. Rhodium points out that cuts to the Environmental Protection Agency’s data collection and reporting on greenhouse gases mean the U.S. is “heading into murkier waters” when it comes to tracking emissions from the world’s second-largest emitter.
At the same time, the world’s remaining carbon budget to keep warming below 1.5°C is only 170 billion tons of CO2, which is about four years at today’s emission rates. The year 2025 was also the second- or third-hottest on record.
If China’s emissions stay flat, the country may have already peaked years before its 2030 goal. India’s power sector emissions dropped 1% in the first half of 2025, only the second time this has happened in nearly 50 years. These changes show that large-scale clean energy can cut emissions even as economies grow.
The difference is clear: while Asia’s biggest economies show that strong renewable energy growth can lower emissions, U.S. policy changes are expected to add 0.8 to 1.2 gigatonnes to emissions by 2035 compared to earlier forecasts. The question is whether global clean energy progress can make up for the U.S. moving backward.