China has approved significantly fewer new coal capacity projects this year compared to last year, according to a report by the Finland-based Centre for Research on Energy and Clean Air (CREA). This trend indicates a shift towards greater investment in wind and solar energy.
CREA, as reported by Reuters, noted that “with new renewable energy projects now capable of meeting all additional power demands in China, the need for new coal is decreasing. There are signs that the central government might be accepting this change.”
A Greenpeace East Asia report released earlier this week highlighted a nearly 80% drop in new coal capacity approvals in the first half of the year compared to the same period last year. The total new capacity approved during this time was 10.3 gigawatts (GW).
In contrast, wind and solar power have seen the largest increases in new capacity. The Greenpeace report revealed that the total installed capacity of wind and solar now exceeds that of coal in China, standing at 11.8 terawatts (TW) compared to coal’s 11.7 TW.
The Centre for Research on Energy and Clean Air stated, “This economic powerhouse has turned clean energy from a climate policy element into a central part of China’s broader energy and economic strategies.”
Despite this shift, coal still dominates China’s energy mix, making up 71% of the total as of 2023. This represents a slight decrease from 73% a decade ago. The share of coal in the energy mix has seen further reductions this year, with the largest drop occurring in May when coal accounted for 53% of the mix before rising to 65% in July.
While CREA is confident that the reduction in new coal capacity signals a move towards wind and solar, Greenpeace remains uncertain. Gao Yuhe, project lead at Greenpeace East Asia, told Reuters, “Are Chinese provinces slowing down coal approvals because they have already approved many projects during this five-year plan period? Or are these approvals the final stages of coal power as the energy transition makes coal less viable? Only time will tell.”