This was mentioned in The Mote in God's Eye. Later civilizations had to go straight to renewables or nuclear because no accessible fossil fuels were left.
In fact, suspiciously, only a small percentage of what exists today is assumed to have been formed in the Paleozoic. If anything the notion that they'd have used up the fossil fuel only supports the idea that such a civilization may have existed, if anything.
But of course one can also point to the simple fact that we're already transitioning to renewables and we're far from being short. We just do it because it's better. So why couldn't a past civilization have done the same?
Similarly while trains needed fossil fuels ships didn’t and allowed for very efficient transportation of goods on the ocean and inland through areas with sufficient rainfall. The major historic use of coal was for heating, but much of the earth never gets that cold.
Additionally, coal wasn’t even used for making steel in the US basically at all until 1827 (charcoal has fewer impurities like the sulfur found in a lot of early coke). The US primarily used charcoal from wood even for iron production until well into the mid 1800s (and by 1884, charcoal was still used for 10% of iron and steel production in the US, and charcoal was still used in some niche areas even into the 1940s). And steam locomotives in the US were also often powered by wood in the 1800s.
Critically, you can move wood long distances so running out locally isn’t an major issue as long as you don’t run out globally.
Your industrial output will be limited, but there's plenty of land and forests grow by themselves.
A large fraction of the early/mid Industrial Revolution was powered by hydro/wood. Abundant rainfall is why so much industry ended up in the north eastern US and England. Efficient motors was more a result of a scientific and industrial innovation rather than the cause of such.
So suggesting Ironworks as a major obstacle doesn’t really stand up.
Almost all of our current hydropower is based on damns made of concrete. Creating the cement for that is very energy intensive. Also turbines and generators are made of metals which require a lot of energy to melt.
Probably you can bootstrap a waterpower based industry somehow without fossil fuels but it is not trivial.
The other thing is that each incremental step in such a process has to provide some benefit to the participants. For example you are not going to have generators without readily available good quality copper wire, but bootstrapping a copper refining and wire making industry without fossil fuels is very hard. Those people need to see a reason for doing it in a world where there is no electricity yet therefore there is very little need for said copper wires.
There’s this idea that the Industrial Revolution ran on coal but Coal was an inferior fuel for steel production until ~1827 or so.
Eventually steam locomotives beat horse / manpower drawn canal boats, but it a close contest until surprisingly recently. Hell the last commercial cargo sailing ship was in use until the 1960’s long after nuclear power became a thing.
Is that really harder than building hundreds of kilometers of aqueducts? Humans have known how to engineer water flows for thousands of years, if we valued power we would build those dams. That power would be more expensive so it would slow down the industrial revolution but it would still happen.
Also you don't need continuous power for an industrial revolution, that is convenient but factories are still revolutionary even if they just run half the year.