Climate change: record clean energy generation could propel China to peak power sector emissions by 2025, report says

‘The astonishing growth’ of clean energy installations means the country’s power sector is way ahead of the 2030 target, says climate think tank
However, continued investment in coal-based capacity and a lack of firm emissions targets undermine efforts green transition efforts, says report

Business of climate change

Yujie Xue

Published: 8:00am, 29 Nov 2023

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Record clean energy installations could help China’s power sector to reach peak emissions in the next two years, but continued investment in coal-based capacity and a lack of firm emissions targets could undermine optimism about the country’s green transition, according to climate researchers.

China is expected to generate 440 terawatt hours (TWh) of clean electricity from solar, wind, hydro and nuclear sources in 2023, exceeding the country’s 10-year average electricity demand growth of 367 TWh for the first time, said Helsinki-based climate think tank the Centre for Research on Energy and Clean Air (CREA).

This could mark an “inflection point” in the country’s energy system, whereby non-fossil energy installations have reached a level at which they can start not only to cover all of the additional electricity demand, but to replace coal, CREA said in a report on Wednesday.

If the trend continues, China’s power sector emissions could peak and begin to fall in the next two years, CREA’s analysts estimated.

“The astonishing growth of clean energy installations in China up to 2023 means the country now has the ability to peak and decline carbon dioxide emissions imminently by ensuring the continuation of that growth,” said Lauri Myllyvirta, lead analyst at CREA, in an email separate to the report.

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“Yet, China’s current climate commitments leave space for carbon dioxide emissions to increase until the end of this decade, which would make meeting the goals of the Paris Agreement all but impossible.”

The think tank urged China to strictly control new coal power capacity, firm up its targets for capping power sector emissions, and accelerate investment in clean power generation and electricity storage to reduce its reliance on coal power.

China, the world’s largest greenhouse gas emitter, is targeting peak carbon emissions by 2030 and net-zero emissions by 2060.

According to another report, published on Monday by CREA and the Heinrich Böll Foundation (HBF), a German think tank, China’s carbon dioxide emissions are forecast to rebound in 2023 from a slight decline last year, increasing by at least 4 per cent year on year, as a result of a collapse in hydropower output caused by a historical drought that drove up coal-fired power generation, and the reopening of the economy after almost three years of Covid-19 restrictions.

While China’s deployment of clean energy generation has reached a scale aligned with the Paris Agreement goals of limiting global warming to 1.5 degrees Celsius, its total carbon emissions, energy consumption and investment in coal-fired power capacity remain off track, according to CREA and HBF.

Despite President Xi Jinping’s declaration that China would “phase down” coal use starting from 2026, the government has been promoting a massive wave of new coal power plants on the basis of energy security concerns. From the start of 2022 to July this year, China’s coal power capacity saw a net increase of 40 gigawatts (GW), while the rest of the world saw a net reduction of 19GW, according to the CREA and HBF report.

Construction of new coal plants outside China is on track to decline for the second year in a row and reach a record annual low in 2023, according to a report by Global Energy Monitor published on Tuesday.

“China’s emissions matter hugely for the global climate trajectory,” said Jörg Haas, head of the globalisation and transformation division of HBF.

The expansion of coal-fired power generation in China has been by far the main driver of increases in global emissions, responsible for three quarters of total emissions growth since the signing of the Paris Agreement in 2015, according to CREA.

“To keep [the Paris Agreement] goals within reach, it’s essential for China to commit to reducing power sector emissions as soon as possible,” said Myllyvirta.