China’s Coal Power Spree Risks Missing Climate Goals: Report

Smoke belches from a coal-fueled power station near Datong, China on Nov. 19, 2015. Greg Baker/AFP via Getty Images

News Analysis

As the debate over dirty energy—a term for energy production that is against climate efforts and hurts communities—rages, China continues to unveil new coal projects, defying its government’s plans and the global climate effort concerns, experts say.

A new report from the U.S. think tank Global Energy Monitor (GEM) and the Helsinki-based Centre for Research on Energy and Clean Air (CREA) found that with China accelerating electrification of everything, the nation approved a staggering 106 gigawatts (GW) of coal power capacity and started construction on 70 GW in 2023. China also commissioned 47 GW of coal-fired capacity and announced 108 GW in new projects in 2023.

In addition to the “frantic pace of permitting seen in 2022,” the new approvals are equivalent to two new coal power plants per week and starting construction on one new plant per week.

“China is badly off track to meet several climate targets the country set for 2025 as a result of an increase in coal use and investment in coal power,” said the report.

It added that power generation from coal climbed by 12 percent from 2020 to 2023, accounting for 44 percent of the overall expansion in power output, despite the rhetoric of coal power playing a “supporting” role.

Almost half (46 percent) of energy growth came from coal and 70 percent from fossil fuels, falling short of the aim of renewable energy accounting for more than 50 percent of the increase.

China committed to reducing its greenhouse gas emissions to zero by 2030 and has pledged to “strictly control” the addition of new coal-fired production capacity and linking an unprecedented number of wind and solar power facilities to its electrical grid.

According to GEM and CREA research, China’s energy transformation might be slowed down by its recent coal power permitting boom, which occurred following a wave of electricity shortages in 2021.

In only two years, China approved 218 GW of new coal power, which is sufficient to power Brazil.

“Drastic action” is now needed to achieve carbon and energy intensity targets by 2025, according to the report. It warned that China may also face challenges in meeting its target of increasing the proportion of non-fossil fuels to 20 percent of the overall energy mix by the same year.

The analysts said that coal power already contributes to about 70 percent of emissions in China.

Sufficient Capacity

Power shortages are also often cited as a major reason for building new coal power plants, but Vibhuti Garg, an analyst at the Institute for Energy Economics and Financial Analysis, says China has enough generating capacity to meet power demand, even during summertime peaks.

“Although China is a growing economy, the huge coal capacity is remarkable, and a concern because of the fact that coal power plants are running at low capacity,” Ms. Garg told The Epoch Times.

“China’s current pace of infrastructure addition does not justify its coal capacity addition, and we do not understand why China is not focussing on utilizing the existing power plants at full capacity.”

She added that China hasn’t clearly stated whether some newer capacity would replace older inefficient plants.

According to CREA, the rigid and antiquated method of operating the grid is the root cause of the shortages. There is now an oversupply of coal-fired power capacity in some grid regions, although 60 percent of new coal power projects are located there. For instance, in Shandong and Guizhou provinces, where there is currently a lot of unused capacity, more coal power plants are being built.

“China’s ongoing coal plant permitting and construction boom continues to be at odds with President Xi’s pledge to strictly control new coal power projects, and out of step with the rest of the world. Overbuilding coal ‘just in case’ and with a ‘we’ll deal with that later’ approach is a costly and risky gamble, especially when alternative solutions are available to meet targets and address energy security,” Flora Champenois, research analyst, Global Energy Monitor, noted.

All Climate Promises Astray

The climate pledge to “strictly control new coal power” is just one of several that China is finding difficult to fulfill.

By 2025, China aims to have significantly decreased its energy and carbon intensity and severely limit the expansion of its coal use, according to its 2021 revised Nationally Determined Commitment under the Paris Agreement. An additional objective of the country’s five-year plans is to source more than half of the growth in energy consumption from renewable sources by 2025 and to raise the proportion of non-fossil fuels in the energy mix to 20 percent.

But after 2023, none of these goals will be achieved, says CREA.

China’s GDP growth decreased during and after the zero-COVID years (2020–2023), although CO2 emissions soared. During this period, the service sector, which uses less energy, was in a tailspin while the carbon-intensive industries drove economic expansion. According to CREA’s study of preliminary government statistics on energy use in 2023, there was a 5.2 percent rise in CO2 emissions from the energy industry.

The process of decarbonization is intricate and lengthy, says Xuyang Dong, China Energy Policy Analyst at Climate Energy Finance. It needs a determined and ambitious workforce, a government and business policy effort supported by solid research, and, most importantly, a considerable commitment of resources.

Effectively guiding the whole economy towards an inevitable zero-carbon future also necessitates long-term strategic planning, looking forward to market patterns over the next 10 or 20 years.

“Achieving decarbonization requires more than just an eye to short-term financial gain; fundamental structural reform within the country’s economy is the precondition to thrive from decarbonization both environmentally and economically,” she wrote in a note.