China’s coal use set to rise until 2026, pushing world’s top carbon emitter ‘off track’ from Paris Agreement: analysts

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China’s continued reliance on coal-fired electricity plants is pushing the country “off track” from the Paris Agreement goal of limiting global warming to less than 1.5 degrees Celsius by the end of the century, according to energy analysts.
The world’s largest energy consumer, China will increase its coal consumption until 2026 and will only record declines after 2027 as renewable energy sources such as wind and solar energy take a larger share of power generation, according to a report from researcher Rystad Energy.

China’s rapid additions of new coal-fired power plants and its lack of a coal phase-out plan are responsible for it falling behind the Paris Agreement pace, despite the country’s record buildout of renewable energy, according to a report released by Climate Analytics and NewClimate Institute on Tuesday.

“While the global coal pipeline outside of China is shrinking, China’s coal plant permitting spree is a cause for concern,” the report said. “If it continues, the only way to avoid a major increase in emissions would be to drastically cut power plant utilisation.”

Steam billows out of cooling towers at a coal-fired power station in Nanjing, in east China’s Jiangsu province, on September 27, 2021. Photo: AP

Coal, the most emissions-intensive fossil fuel, currently meets more than half of the energy needs in China, which is the world’s largest greenhouse-gas emitter and the world’s largest consumer, producer, and importer of coal. China’s coal consumption increased 3.3 per cent in the past five years to around 4.04 billion tonnes last year, according to data from Rystad.

Total coal consumption will further rise to 4.2 billion tonnes in 2026 before sliding to 2.4 billion tonnes by 2040 and 1.4 billion tonnes by 2050, Rystad’s report said.

Chinese President Xi Jinping said two years ago that the country would start “phasing down” coal use starting in 2026 as part of its effort to slash carbon emissions and reach carbon neutrality by 2060. However China has been adding coal capacity at a record pace: it approved an average of two plants per week and added 52 gigawatts (GW) of new coal-fired capacity in the first half of 2023, according to a report published last month.

China’s coal power emissions per person grew most in G20 between 2015 and 2022

“China is increasing coal-fired power generation in the short term to meet peak demand, maintain grid stability and manage extreme weather loads, as we’ve witnessed with the recent heatwaves,” said Ashis Kumar Pradhan, senior coal analyst at Rystad Energy. “However, in the long term, coal power plants will take on a backup role for renewables and during times of high electricity demand.”


In the meantime, China is also keeping many older coal plants online longer. In 2021, the National Development and Reform Commission (NDRC), the country’s central economic planner, revised its policies to allow small, inefficient facilities to remain online as backup capacity or remain in regular operation after retrofits. This slowed the retirement of older plants to 4GW last year from 5.2GW in 2021, according to Rystad.

China’s overall power demand will climb by around 5 per cent over the next five years, while renewable power generation capacity is expected to rise by 18 per cent to 3,000GW by 2030. This will send renewable generation’s share of the total energy mix to 33 per cent in 2030 from 18 per cent in 2022, Rystad said.

China coal spree continues at frantic pace despite 2030 carbon pledge: report

At the same time, coal’s share of generation is expected to decline from 61 per cent in 2022 to 43 per cent in 2030, with more coal plants serving as backup capacity for renewable energy in times of high demand.

However, to achieve the 1.5-degree target, coal’s share of China’s power mix must be slashed to single digits by 2030, and coal must be completely phased out by 2040, according to Climate Analytics and NewClimate Institute.

“Although China has targeted a reduction in coal consumption after 2025, there is no concrete target of a complete phase-out, despite a carbon neutrality target in 2060,” the report said.

G20 nations must commit to phasing out coal

China currently has about 240GW of coal power plants permitted or under construction, and the figure could rise to almost 400GW if Beijing does not take concrete action to control its approvals, according to the two organisations.


With the anticipated decline of coal generation and rapid growth of renewables, coal plants’ revenue will suffer due to low utilisation, according to Rystad. The NDRC has been developing mechanisms to compensate coal power plants for losses as they adjust to their new role as backup suppliers.

The NDRC has not released details regarding the mechanisms, but it is clear that the government is committed to reducing its reliance on coal in the long term, according to Pradhan.

Why is China’s steel sector investing US$100 billion in coal-fired plants?

In the short term, however, China cannot simply stop permitting coal plants.


“Coal is still the most reliable and affordable source of power in China, and it is essential for meeting peak demand and managing extreme weather loads,” he said. “Without coal in the power mix, it would be very difficult to manage the load and maintain grid stability.

“I believe that the best approach is for China to gradually reduce its reliance on coal as renewable energy capacity increases. This will allow China to maintain energy security while also reducing its emissions.”


The news is published by EMEA Tribune & SCMP210520-twitter-verified-cs-70cdee.jpg (1500×750)

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