The global pace of new construction of power stations is slowing while retirement of ageing plants is accelerating, placing the world on track for "peak coal" capacity within a couple of years.

The annual Boom and Bust report, compiled by researchers including Global Energy Monitor and Greenpeace, found construction starts, pre-construction activity and completions of coal-fired plants each fell in 2018 for a third year in a row. New starts are down 84 per cent since 2015.

Retirements were also at a record pace, led by the US despite backing for the sector by the Trump administration. The US shut 17.6 gigawatts of coal power, while the European Union retired 3.7GW including 2.8GW in the UK where coal's share of electricity dived to just 5 per cent in 2018.

China accounts for about half of the world's new coal-fired power stations being built in the Middle Kingdom or elsewhere. Credit:Sanghee Liu

The future of coal demand, however, continues to pivot on China. The world's largest coal consumer issued permits for 5GW of new coal-fired power plants last year, a fraction of the 184GW approved in 2015.