Charcoal is wood that has been heated above combustion temperature without oxygen. That does drive off water, but it also chemically decomposes the lignin and other organics into primarily carbon while creating a volatile mixture of gasses known as woodgas.
Source: Have a woodgas generator. Byproduct is charcoal.
What’s the difference?
One you can mine from the ground.
The other you get by smelting oak logs in a furnace
You can also get the former by killing wither skeletons, making it a renewable resource.
Coal is mined out of the ground.
Charcoal is wood that has been super heated to remove the water.
Charcoal is wood that has been heated above combustion temperature without oxygen. That does drive off water, but it also chemically decomposes the lignin and other organics into primarily carbon while creating a volatile mixture of gasses known as woodgas.
Source: Have a woodgas generator. Byproduct is charcoal.