In a world enthralled by the transition to renewable energy, China is to continue approving new coal plants through 2027 in key regions. China has, for the past few years, been leading the global transition towards the renewable energy sector, aligning with the nation’s National Development and Reform Commission. However, that transition has hit a speed bump as China has announced its plans to continue to approve new coal operations through 2027, raising questions about the nation meeting its ambitious plans to phase out coal by 2030.
China’s proclivity for the coal industry simply won’t go away as peak demand grows
The world has, for the past decade or so, been encompassed by calls to phase out coal by the end of the decade. The Paris Agreement brought the energy sector to the forefront of the energy discussions and mandated that nations fast-track the phasing out of coal to be replaced with wind, solar, and other renewable energy sources.
Aligning with the historic trend coming out of the nation, China is among the nations part of the agreement that have accelerated the adoption of the renewable energy sector. China is an exceedingly industrious nation that often leads the world in several sectors; however, the announcement that it will continue to approve new coal plants under a government-approved scheme undermines the progress made and raises questions over its commitment.
The state planner and energy regulator have emphasized the need for coal to continue to operate in peak demand periods. The decision undermines the nation’s very public commitment to phase out coal between 2026 and 2030.
The guidelines mandated by the government state that newly constructed coal mines should have between 10% and 20% lower carbon emissions per unit of power output compared to the 2024 fleet. Additionally, upgrades to existing sites need to meet these new regulations as well.
China’s embrace of the renewable energy sector has slowed due to the new stance towards coal
The aforementioned industriousness has led China to lead the world in the adoption of the renewable energy sector. However, allowing the phase out of coal to stall for the next few years at least has raised serious questions about the implications of keeping coal alive in one of the highest energy usage nations in the world.
The China Coal Association recently reported that China’s coal demand will peak in 2028, later than initially forecasted. The rise of coal usage in the power and chemical sectors will support an increase in consumption. Oh, how the times have changed. In the early 2000s, China’s coal plants operated 70% of the time, while that number today has dropped to around 50%.
The nation’s National Development and Reform Commission has outlined incentives for renewable energy operators in desert regions. These incentives align with China’s plans to peak carbon dioxide emissions before 2030 and achieve carbon neutrality by 2060. European nations have seen coal sites closing down permanently recently, further strengthening calls to phase out coal in favor of the renewable energy sector.
An industry analyst has reported that the role of gas has subsided due to the news that coal will continue to operate in China for the foreseeable future.
“Most of the world is used to gas playing that role. But China has never embraced gas. So, coal is the ‘flexible’ or ‘peaker’ fuel of choice.” – Oxford data scientist Hannah Ritchie
The energy-rich nations of the world are calling for a more balanced approach to the energy sector
Despite China continuing to approve new coal sites, the energy-rich nations of the world are calling for a more balanced narrative in the energy sector globally. The Arab Energy Organization has stated its ambition to foster a more balanced approach to the energy sector, as the conventional oil and gas sectors still dominate the industry. China will phase out coal, eventually. However, the news that it will continue to approve coal plants through 2027 has slowed the progress the nation has made in the global transition trend.
