Transitioning to a low-carbon economy, necessary to mitigate the impacts of anthropogenic climate change, will lead to a significant increase in demand for critical minerals such as rare earth elements (REE). Meeting these raw materials requirements will be challenging, so there is increasing interest in new sources of REE including coal combustion byproducts (CCBs). Extraction of REE from CCBs can be advantageous as it involves reusing a waste product, thereby contributing to the circular economy. While a growing body of literature reports on the abundance of REE in CCBs globally, studies examining the key factors which control their recovery, including speciation and mode of occurrence, are lacking. This study employed synchrotron-based X-ray absorption spectroscopy to probe the speciation and local bonding environment of yttrium in coals and their associated CCBs. Linear Combination Fitting identified silicate and phosphate minerals as the dominant REE-bearing phases. Taken together with the results of extended X-ray absorption fine structure (EXAFS) curve fitting, we find there is minimal transformation in the REE host phase during combustion, indicating it is transferred in bulk from the coals to the CCBs. Accordingly, these findings can be incorporated into the development of an efficient, environmentally conscious recovery process.