China’s coal plant construction surged last year to the highest level in almost a decade, conflicting with President Xi Jinping’s promise that carbon emissions would peak before 2030, researchers have said.
In a report released on Thursday, the think-tank Centre for Research on Energy and Clean Air (Crea) and Global Energy Monitor (GEM) said that while China added a record 356GW of wind and solar electricity-generating capacity in 2024, it also began building coal power plants with 94.5GW of capacity, the most since 2015.
The new construction, as well as the resumption of suspended projects with another 3.3GW capacity, boosted coal’s role in the power system of the world’s second-largest economy despite its push into renewables, the report said.
“Instead of replacing coal, clean energy is being layered on top of an entrenched reliance on fossil fuels,” said the report, which was lead authored by Qi Qin, China analyst at the Helsinki-based Crea, and Christine Shearer of California-based GEM. “The parallel expansion of coal and renewables risks undermining China’s clean energy transition.”
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China is the world’s biggest emitter of greenhouse gases, accounting for about 30 per cent of the global total.
But it is also rapidly developing renewable energy — its expansion of wind and solar energy capacity last year was nearly equivalent to the total installed in the US. Xi has pledged the country will reach peak carbon dioxide emissions before 2030 and net zero emissions by 2060.
“China has always been a doer in climate response and is firmly committed to green and low-carbon development,” said a senior Chinese official. “Our carbon emissions intensity has kept decreasing, the share of non-fossil fuel in total energy consumption has steadily increased.”
But the Crea and GEM report argued that structural factors in China’s power generation industry meant the surge in coal plants could impede the transition to renewable energy.
Electricity buyers were locked into long-term coal power purchasing agreements that penalised them if they fail to buy contracted volumes. This discouraged them from prioritising clean energy, the report said.
Coal mining companies were also funding 75 per cent of newly approved coal power capacity, driving new projects even “when market fundamentals do not justify it”, the report said.
“Coal and clean energy are increasingly competing for space in China’s power system. In the fourth quarter of 2024, despite slowing electricity demand growth, fossil fuel generation remained high, while solar and wind utilisation dropped sharply,” the report said.
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Other analysts said that part of the reason China was building more coal plants could be its lack of a unified national market.
This meant different regions built their own coal plants to provide local “load following” — power used to balance out fluctuations from renewables — potentially creating capacity that would not be needed if there was a national market.
Coal plants and renewables had different economics, the analysts said. Coal plants often received “capacity payments” for being read to make electricity available to the grid to back up renewables.
“For the most part, coal competes with other coal,” said David Fishman, senior manager at the Lantau Group, a consultancy.
Fishman said China’s coal plant fleet was operating at about 50 per cent capacity. Construction of more coal-fired power stations would “on the whole” mean lower use of their capacity, he said.
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