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We handpick and explain the most important climate and energy stories from China.
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A new Carbon Brief guest post has examined China’s plans to build “gigantic” wind and solar power “bases” and their implications for the country’s carbon-peaking and carbon neutrality goals. The analysis found that China is set to add at least 570 gigawatts (GW) of wind and solar power in the 14th five-year plan (FYP) period from 2021 to 2025.
Meanwhile, “more than half” of the capacity of the newly commissioned coal-fired power plants installed around the world in 2021 was in China, a new report has found. The report said that the “surge” of China’s new coal-fired capacity “almost offset” coal plant retirements in the rest of the world last year. Two of its authors explain the report’s key findings for Carbon Brief below.
Over the past two weeks, China has taken a series of actions on coal to ensure energy security. China’s central bank issued $15bn worth of extra loans yesterday to support the “clean and efficient utilisation of coal”. The news came after the central government said that it would cut import tariffs for coal to zero from 1 May this year to 31 March next year – a move that could “benefit” Russian coal, according to reports.
Analysis examines China’s renewable energy development
WHAT: A guest post published by Carbon Brief on Tuesday has assessed China’s efforts to develop its renewable energy industry and how its plans to build “gigantic” wind and solar energy bases could help the country hit its climate goals. By evaluating government documents, the post’s authors – Lauri Myllyvirta and Xing Zhang from the Centre for Research on Energy and Clean Air (CREA) – found that China is set to add “at least” 570GW of wind and solar power between 2021 and 2025. This means that China’s installed capacity for wind and solar power could “more than double” in just five years, reaching “more than 1,100GW by 2025”, the article said. It added that, along with China’s other plans for clean energy expansion, the new wind and solar power “could be enough” to allow China to peak its fossil fuel consumption – and CO2 emissions – “before 2025”.
WHEN: The rate of growth would put China “on track to” meet its target for renewable energy in 2026 – four years earlier than the government’s current timeline – the analysis said. (China’s president Xi Jinping said in December 2020 that China would bring its total installed capacity of wind and solar power to exceed 1,200GW by 2030.) The analysis also explained the definition and importance of “clean energy bases”, a concept first introduced in China’s overarching 14FYP in early 2021. These “bases” will not only see “numerous” large wind and solar parks being constructed, but also contain long-distance transmission lines to demand centres and – in most cases – “supporting” coal power plants, the analysis noted.
WHERE: The analysis said that a major reason behind the development of those clean energy bases – as well as the “supporting” coal bases – is to make use of the resources of the “sparsely populated” provinces in west China, with an aim to meet the energy demand of the more populous and prosperous east. The northern province of Inner Mongolia and the north-western province of Gansu will see the “largest” clean energy bases constructed. According to plans, the two regions will see approximately 190GW of new wind and solar capacity installed by 2025, on top of their current installed capacity of 74GW.
WHO: This guest post came after an official from China’s state energy regulator announced the latest figures about the country’s renewable power capacity. Wang Dapeng – deputy director of the renewable energy division at the National Energy Administration (NEA), the state energy regulator – said last Friday that China’s renewable capacity had grown by 25.4GW in the first quarter of 2022, which accounted for 80% of the power generation capacity the country had installed during the three months. The capacity of wind and photovoltaic (PV) solar power had increased by 7.9GW and 13.2GW, respectively, in the period, making up a combined 66.5% of the overall renewable capacity growth, Wang noted. By the end of March, China’s installed capacity of renewable power had reached 1,088GW, around one-third of the world’s total. The wind and PV solar power capacity had amounted to 337GW and 318GW, respectively, by the end of March, Wang added.
HOW: The construction of “gigantic” bases must take into consideration the accommodation and utilisation of the wind and solar power that they generate, experts have said. At a recent industry forum in Beijing, Li Qionghui – director of the New Energy and Statistics Research Centre at the State Grid Energy Research Institute – noted that those large bases “would be meaningless” and “would not be able to support the realisation of the carbon-peaking and carbon neutrality goals” unless their power generation could be absorbed and used by the grid, reported China Energy News. Whether or not those renewable resources would be wasted – a problem China has seen before – will depend on whether the power transmission channels could be completed at the same time as the bases, said Chi Yongning, chief engineer of the New Energy Centre at the China Electric Power Research Institute, according to the same report.
China added ‘more than half’ of new global coal power capacity
WHAT: China commissioned 25.2GW of coal-fired power capacity in 2021, which accounted for 56% of the whole world’s newly commissioned coal power capacity last year, according to an annual report that tracks the global coal plant pipeline. The report noted that China’s “surge” of new capacity last year “almost offset” coal plant retirements in the rest of the world, which stood at 25.6GW. The report added that Japan, South Korea and China “all pledged to end public support for new international coal plants” in 2021. (See more findings from the report about China in the analysis below, written by two of its authors.)
WHO: The report was jointly published by a collective of coalitions and organisations from different parts of the world, which specialise in environmental, climate change and energy issues. Two of them – Global Energy Monitor (GEM) and Sierra Club – are based in the US. Three come from Europe: CREA, E3G and Climate Action Network (CAN) Europe. The rest are in Asia, including South Korea-based Solutions for Our Climate (SFOC), Japan-based Kiko Network, India-based Legal Initiative for Forest and Environment (LIFE), plus three groups from Bangladesh.
WHEN: The report came on the same day a 1GW coal-fired power unit went into operation at a major new coal power plant in south-east China. According to China Electric Power News, the unit is the second out of two “ultra-supercritical” 1GW coal-fired power units that form the first phase of the Luoyuanwan coal power plant in Fujian province. The newspaper said the unit could “enhance the energy security of Fujian” (more details below). The news also came as Chinese leaders continued to emphasise the importance of coal power. Yu Bing – deputy director of the NEA – said on 24 April that coal power “will still bear important responsibilities of ensuring power security in the long run” in China, reported China’s state news agency Xinhua.
WHY: There are several “key drivers” behind “continued coal power expansion” in China, according to the report. They include “insufficient investment” in clean energy, “outdated” planning and operation of the power grid and “conflict” between the central and local governments. The report noted that, although the “crisis” that saw dozens of Chinese provinces face electricity shortages late last year had “nothing to do” with lack of coal power plant capacity, a “shift in political winds” appears to have led to the “resumption” of coal plant permissions in early 2022. (Read Carbon Brief’s assessment of China’s power shortages last year.)
MEDIA COVERAGE: Reuters said that the report “found that global coal plant capacity grew 18.2GW to about 2,100GW or about 0.87%”. The newswire reported that China’s “recent focus has shifted towards energy security, following disruptive power cuts and geopolitical uncertainties since Russia’s invasion of Ukraine”. The Guardian wrote that “far too much” coal is still being used and “too many” new coal power plants are planned in order for the world to “stay within safe temperature limits”, according to the report. New Scientist led its piece with the report’s mention of China, adding that China’s coal capacity expansion showed “how much the country is propping up one of the worst drivers of climate change”. The South China Morning Post described the “addition” of Chinese coal power plants as “hurting global efforts to phase out dirty fossil fuel”, quoting the report.
China ‘increasingly isolate[d]’ in developing new coal power
The world’s total operating coal power capacity grew by 18.2GW in 2021, driven by expansion in China. Capacity in the rest of the world contracted, as it has every year since 2018, finds the latest report by Global Energy Monitor and partners.
China continued to be the glaring exception to the ongoing global decline in coal plant development. Its climate targets are not yet leading the country to scale back planned coal power capacity.
In 2021, China’s 25.2GW of new coal plants made up more than half (56%) of the newly commissioned capacity worldwide. In addition, China’s retirements slowed down, dropping to an estimated 2.1GW, the lowest in more than a decade. Outside China, the global coal fleet shrank for the fourth year in a row.
Construction also started on 33GW of new coal plants in China, the most since 2016 and almost three times as much as the rest of the world put together. And although permitting of new coal power projects essentially froze in response to government policy signals in 2021, power shortages in the second half of 2021 were successfully leveraged by pro-coal interests to revisit the country’s energy policy. In the first six weeks of 2022, at least 7.3GW of new coal capacity was permitted, more than twice as much as in all of 2021.
In theory, the government’s ambitious plans for increasing clean electricity production by 2025 mean that the utilisation of coal-fired power plants could drop even as capacity increases.
China argues that the continued addition of coal capacity doesn’t directly contradict its climate commitments, as those commitments allow emissions to rise until the late 2020s and do not limit coal power capacity as such. But unless new coal power projects are controlled much more strictly, worsening overcapacity in coal-fired power could make China’s energy transition harder and more costly.
While China’s 2060 carbon neutrality target implies that most coal capacity will need to be retired by 2050, the coal expansion planned over this decade brings the country’s projected capacity pathway more and more out of sync with a Paris-aligned trajectory. Given that China’s power sector has been the main source of increases in global fossil emissions in the past two years, directing all new investments into clean power generation could be a crucial contribution to meeting the Paris Agreement.
Collectively, the global shift away from new coal increasingly isolates China. The trend is likely to continue through 2022, particularly if China follows through on its commitment to no longer build overseas coal.
(For more analyses on coal and China, read Carbon Brief’s recent analysis titled: “What does China’s coal push mean for its climate goals?”)
LOANS: China has issued more state-backed loans to ensure the production, use and stockpiling of coal. China’s central bank said on Wednesday that it had increased its “targeted relending quota” for the “clean and efficient utilisation of coal” by 100bn yuan ($15.1bn) – on top of the previously approved 200bn yuan – China News Service reported. The state-run newswire said that the funds would be dedicated to supporting “the development and use of coal” and enhancing the country’s ability to retain coal reserves. It added that the move would help “further release advanced coal production capacity, guarantee the safe and stable supply of energy and support the economy to operate within a reasonable range”.
TARIFFS: China will cut import tariffs for “all types” of coal from 3-6% to zero from 1 May this year until 31 March next year, Reuters reported. The decision came as “Beijing strives to ensure energy security amid soaring global prices and supply disruption concerns”, the newswire noted. According to “some traders”, the decision could “benefit” coal imports from Russia because the tariffs for Indonesian and Australian coal had already been cut to zero, with the latter also facing an “imports ban”, the outlet added. (The three largest coal-exporting countries to China in the first half of 2021 were, in order, Indonesia, Russia and Mongolia, according to China’s Time Weekly.)
OVERSEAS COAL: 15 China-backed overseas coal projects with a combined capacity of “around” 12.8GW have been cancelled in planning stages since China’s President Xi announced last September that his country “will not build new coal-fired power projects abroad”, Reuters reported, citing new research. The newswire noted that Xi’s pledge “could also stop another 37GW of capacity currently in the pre-construction phase”, but leave 18 projects – whose combined capacity amount to 19.2GW – in a “grey area”, according to the research published by CREA. (The Chinese government provided some explanations for Xi’s pledge for the first time in March, which China Briefing analysed.)
‘LOOPHOLES’: China-focused blog Panda Paw Dragon Claw reported on some new contracts that “raise further questions about China’s no coal power pledge” in its weekly newsletter. It said that Energy China – a state-owned conglomerate – had inked contracts with a coal-fired power plant in Indonesia “for equipment” and with another plant in Laos “for ‘engineering design and technology services’”. These deals highlighted the “scope, limitations and possible loopholes” of China’s pledge, the newsletter said. (Experts have mentioned the Gwadar coal-fired power plant in Pakistan to Carbon Brief while explaining the “ambiguity” of China’s no overseas coal pledge.)
NEW PLANT: The Luoyuanwan coal power plant in south-east China’s Fujian province saw the second of its two 1GW coal-fired power units go into commercial operation on 26 April, according to China Electric Power News. The two units are expected to generate a total of 8 terawatt hours (TWh) of electricity every year, the outlet noted. Luoyuanwan is operated by a branch of CHN Energy, a Chinese state-owned mining and energy company. (According to previous reports, it is the largest thermal power project under construction in Fujian.) The report described the two units as “typical representatives of those domestic coal-fired power units that are clean and green, highly efficient and low-carbon, flexible and safe, intelligent and smart”.
XI: China’s president Xi Jinping has replied to a letter sent to him by pupils from the Francis Holland School in the UK regarding climate change, Xinhua reported. According to the outlet, Xi described climate change as “a common challenge to all humanity” in his letter, adding that “mankind should cooperate to tackle the issue”. Xi told the pupils that they “are welcomed to visit China” and “encouraged” them to “communicate with their Chinese peers”, Xinhua noted. Xi’s reply was read out to pupils at the school in London’s Sloane Square on 21 April by Zheng Zeguang, China’s ambassador to the UK.
NUCLEAR: A major nuclear power plant in China saw its sixth generator successfully connected to the grid on Monday, Xinhua reported. Situated in Liaoning province, Hongyanhe is the first nuclear power plant in north-east China – the country’s rust belt – and the largest energy project in the region by investment, the state news agency said. It noted that the plant had generated 194.4 terawatt hours of on-grid electricity by the end of 2021. The Global Times, a state-run newspaper, said that the plant has “not only provid[ed] abundant electricity to north-east China’s industrial base but also play[ed] an active role in adjusting the energy structure in the region”.
- Next steps in US-China climate cooperation – Shiran Victoria Shen, Jean C Oi, Yi Cui and Liang Min, The Hill
- Going green? Chinese policy banks’ changing role in global energy development – Cecilia Springer, China Dialogue
- China’s path to decarbonisation – Muyi Yang and Xunpeng Shi, Asia and the Pacific Policy Society
- Coal to power China’s energy transition – Shih Yu (Elsie) Hung, Baker Institute, Forbes
A new study has analysed the expected performance of prospective government-led investments in coal-fired power projects in China. The researchers conducted the assessment through a combination of plant-level financial analysis, normally used to assess stranded asset risks, and economic analysis, which measures a “broader view” of the country-level economic returns. The study suggested that “at least some” of the new coal plants planned in China “may never” generate positive economic returns, especially if the Chinese government chooses to carry out “even relatively modest” market-based or control policies to achieve its climate and other environmental and societal goals.
Exploration of China’s net CO2 emissions evolutionary pathways by 2060 in the context of carbon neutrality
Science of the Total Environment
New research has found that China has the “potential” to achieve net-zero CO2 emissions “by 2060” by both reducing emissions and increasing forest carbon sinks. (China’s current goal is to achieve the neutrality of all greenhouse gas emissions “before 2060″.) The study projected that China’s total emissions would peak at 11,441m tonnes of CO2 (MtCO2) in 2029. It also said that China’s “post-peak carbon reduction rate” should be 8% per year and its average annual forest carbon sink is “required to be” 209.45m tonnes of carbon per year (MtC/year, equivalent to 768MtCO2/year) between 2021 and 2060. The study also estimated the growth rate of China’s per-capita GDP to be maintained at 5.5% between 2021 and 2023 under the “optimal” carbon neutrality pathway. The country’s total energy consumption “should be limited to” a peak value of 6,000m tonnes of coal equivalent (Mtce) in 2030.
A new paper has suggested three “optimal policies” for developing China’s electric vehicle (EV) market through a series of simulations. The results showed that China should “continue to increase” government expenditure and support for building charging facilities, make charging of EVs “more accessible and convenient” and “implement bans” on the sale of cars run on fossil fuels. The paper also found that the “ideal” time to ban the sale of fossil-fuelled cars and simultaneously cancel current incentives for EVs – such as purchasing subsidies for consumers – is “around 2025”. The paper said: “These changes could reduce government expenditure and thus confer substantial financial savings, and they would effectively promote a significant increase in EV sales.”
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