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Coal power in China

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Coal-fired power plant in China
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Coal power in China is electricity generated from coal in China and is distributed by the State Power Grid Corporation. It is a big source of greenhouse gas emissions by China.

China's installed coal-based power generation capacity was 1080 GW in 2021,[1] about half the total installed capacity of power stations in China.[2] Coal-fired power stations generated 57% of electricity in 2020.[3] Over half the world's coal-fired power is generated in China.[4] 5 GW of new coal power was approved in the first half of 2021.[2] Quotas force utility companies to buy coal power over cheaper renewable power.[5] China is the largest producer and consumer of coal in the world and is the largest user of coal-derived electricity. Despite China (like other G20 countries) pledging in 2009 to end inefficient fossil fuel subsidies, as of 2020 there are direct subsidies and the main way coal power is favoured is by the rules guaranteeing its purchase – so dispatch order is not merit order.[6]

The think tank Carbon Tracker estimated in 2020 that the average coal fleet loss was about 4 USD/MWh and that about 60% of power stations were cashflow negative in 2018 and 2019.[7] In 2020 Carbon Tracker estimated that 43% of coal-fired plants were already more expensive than new renewables and that 94% would be by 2025.[8] According to 2020 analysis by Energy Foundation China, to keep warming to 1.5 degrees C all China's coal power without carbon capture must be phased out by 2045.[9] But in 2023 many new coal power stations were approved.[10] Coal power stations receive payments for their capacity.[11] A 2021 study estimated that all coal power plants could be shut down by 2040, by retiring them at the end of their financial lifetime.[12]

Retirement and addition of coal-fired power capacity
The annual amount of coal plant capacity being retired increased into the mid-2010s.[13] However, the rate of retirement has since stalled,[13] and global coal phase-out is not yet compatible with the goals of the Paris Climate Agreement.[14]
In parallel with retirement of some coal plant capacity, other coal plants are still being added, though the annual amount of added capacity has been declining since the 2010s.[15]
Coal is the main source of electricity but its share is declining

To curtail the continued rapid construction of coal fired power plants, strong action was taken in April 2016 by the National Energy Administration (NEA), which issued a directive curbing construction in many parts of the country.[16] This was followed up in January 2017 when the NEA canceled a further 103 coal power plants, eliminating 120 GW of future coal-fired capacity, despite the resistance of local authorities mindful of the need to create jobs.[17] The decreasing rate of construction is due to the realization that too many power plants had been built and some existing plants were being used far below capacity.[18] In 2020 over 40% of plants were estimated to be running at a net loss and new plants may become stranded assets.[6] In 2021 some plants were reported close to bankruptcy due to being forbidden to raise electricity prices in line with high coal prices.[19]

As part of China's efforts to achieve its pledges of peak coal consumption by 2030 and carbon neutrality by 2060, a nationwide effort to reduce overcapacity resulted in the closure of many small and dirty coal mines.[20]: 70  Major coal-producing provinces like Shaanxi, Inner Mongolia, and Shanxi instituted administrative caps on coal output.[20]: 70  These measures contributed to electricity outages in several northeastern provinces in September 2021 and a coal shortage elsewhere in China.[20]: 70  The National Development and Reform Commission responded by relaxing some environmental standards and the government allowed coal-fired power plants to defer tax payments.[20]: 71  Trade policy was adjusted to permit the importation of a small amount of coal from Australia.[20]: 72  The energy problems abated in a few weeks.[20]: 72 

In 2023, The Economist wrote that ‘Building a coal plant, whether it is needed or not, is also a common way for local governments to boost economic growth.’ and that ‘They don’t like depending on each other for energy. So, for example, a province might prefer to use its own coal plant rather than a cleaner energy source located elsewhere.’[21]

See also

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References

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  1. ^ "Chinese coal plant approvals slum after Xi climate pledge". South China Morning Post. 2021-08-25. Retrieved 2021-09-06.
  2. ^ a b Yihe, Xu (2021-09-01). "China curbs coal-fired power expansion, giving way to renewables". Upstream. Retrieved 2021-09-06.
  3. ^ Cheng, Evelyn (2021-04-29). "China has 'no other choice' but to rely on coal power for now, official says". CNBC. Retrieved 2021-09-06.
  4. ^ "China generated half of global coal power in 2020: study". Deutsche Welle. 2021-03-29. Retrieved 2021-09-06.
  5. ^ "Why China is struggling to wean itself from coal". www.hellenicshippingnews.com. Retrieved 2021-09-06.
  6. ^ a b "China's Carbon Neutral Opportunity" (PDF). Archived (PDF) from the original on 2021-02-28.
  7. ^ Gray, Matt; Sundaresan, Sriya (April 2020). Political decisions, economic realities: The underlying operating cashflows of coal power during COVID-19 (Report). Carbon Tracker. p. 19.
  8. ^ How to Retire Early: Making accelerated coal phaseout feasible and just (Report). Carbon Tracker. June 2020.
  9. ^ China's New Growth Pathway: From the 14th Five-Year Plan to Carbon Neutrality (PDF) (Report). Energy Foundation China. December 2020. p. 24. Archived from the original (PDF) on 16 April 2021. Retrieved 16 December 2020.
  10. ^ "China's new coal power spree continues as more provinces jump on the bandwagon". Centre for Research on Energy and Clean Air. 2023-08-29. Retrieved 2024-01-19.
  11. ^ Lushan, Huang (2023-11-23). "China's new capacity payment risks locking in coal". China Dialogue. Retrieved 2024-01-19.
  12. ^ Kahrl, Fredrich; Lin, Jiang; Liu, Xu; Hu, Junfeng (2021-09-24). "Sunsetting coal power in China". iScience. 24 (9): 102939. Bibcode:2021iSci...24j2939K. doi:10.1016/j.isci.2021.102939. ISSN 2589-0042. PMC 8379489. PMID 34458696.
  13. ^ a b "Retired Coal-fired Power Capacity by Country / Global Coal Plant Tracker". Global Energy Monitor. 2023. Archived from the original on 9 April 2023. — Global Energy Monitor's Summary of Tables (archive)
  14. ^ "Boom and Bust Coal / Tracking the Global Coal Plant Pipeline" (PDF). Global Energy Monitor. 5 April 2023. p. 3. Archived (PDF) from the original on 7 April 2023.
  15. ^ "New Coal-fired Power Capacity by Country / Global Coal Plant Tracker". Global Energy Monitor. 2023. Archived from the original on 19 March 2023. — Global Energy Monitor's Summary of Tables (archive)
  16. ^ Feng, Hao (April 7, 2016). "China Puts an Emergency Stop on Coal Power Construction". The Diplomat.
  17. ^ Forsythe, Michael (2017-01-18). "China Cancels 103 Coal Plants, Mindful of Smog and Wasted Capacity". The New York Times. ISSN 0362-4331. Retrieved 2024-07-02.
  18. ^ "Asian coal boom: climate threat or mirage?". Energy and Climate Intelligence Unit. Mar 22, 2016. Archived from the original on April 24, 2016. Retrieved February 14, 2018.
  19. ^ "Beijing power companies close to bankruptcy petition for price hikes". South China Morning Post. 2021-09-10. Retrieved 2021-09-12.
  20. ^ a b c d e f Zhang, Angela Huyue (2024). High Wire: How China Regulates Big Tech and Governs Its Economy. Oxford University Press. doi:10.1093/oso/9780197682258.001.0001. ISBN 9780197682258.
  21. ^ "Will China save the planet or destroy it?". The Economist. November 27, 2023. ISSN 0013-0613. Retrieved 2024-01-21.
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