China to end new coal power additions before 2030?
Are we near peak coal in China? We frequently hear that 'it's pointless trying to cut carbon emissions in the West, when other countries continue to build new coal fired power stations'.
And the country that gets the most attention is China. But what if this really is just a transition phase? What if the rapid rise in renewables build out will mean that China could see peak coal powered electricity generation well before 2030?
This is the case being argued in a recent report from Climate Energy Finance entitled POWERSHIFT: Staggering rise of renewables positions China to end new coal power before 2030.
The title really says it all. To quote the report:
"Rapidly declining wind, solar and storage costs are dramatically changing the economics of China’s electricity system, and driving a massive increase in renewables capacity. This means that China could see coal power generation peak well before 2030, then plateau and decline."
As a consequence, coal will fade from its current position as a central pillar of China’s power generation, moving to what will be a backup role in ensuring national energy security. Coal is currently 70% of China's electricity supply, but that could fall to 50% by 2030, and maybe as low as 30% by 2040.
How could this happen so rapidly. It's renewable growth? The report forecasts China will likely reach its 14th Five Year Plan (FYP) 2030 target of 1,200 gigawatts (GW) of installed solar and wind capacity six years early.
Why is this so important? As the recent IEA Coal 2023 report says:
"The dominance of China in coal markets is stronger than any other country for any other fuel. It consumes more than half of the world’s coal and produces half of it, and it is the largest importer, single handily accounting for close to one-third of the global coal trade. "
They expect China and India to account for more than 70% of global coal consumption in 2026.
This could have relevance well beyond global GHG emissions. As the report says "this highlights the imperative for Australia to hasten the transition of its economy from a historical overdependence on fossil fuel exports, diversify its economic base and secure domestic cleantech supply chains. "
Other countries in similar positions need to also take note. The sustainability transitions will, over time, substantially reshape our economies. The time to start adapting is now.
We wrote about the expected long and slow demise of coal in a recent blog: Coals (very) long goodbye. Maybe the demise will be quicker than we first thought?
Link to blog 👉🏾 https://www.thesustainableinvestor.org.uk/coals-very-long-goodbye/
This article featured in What Caught Our Eye, a weekly email featuring stories we found particularly interesting during the week and why. We also give our lateral thought on each one. What Caught our Eye is available to read in full by members.
If you are not a member yet, you can read What Caught Our Eye when it comes out direct in your email inbox plus all of our blogs in full...
Click this link to register 👉🏾 https://www.thesustainableinvestor.org.uk/register/
Please read: important legal stuff.
