Will China build more Coal to stimulate the economy?

Could China ramp up coal generation – of the order of hundreds of GW by 2030 – as part of its efforts to stimulate its economy and recover from the coronavirus slump? The thinking is that building a coal plant converts faster into economic growth than the equivalent spent on renewables.

In the previous decade, building coal plants was an effective part of China’s economic growth plan that secured its place as the world’s second largest economy. Energy generation is proven to create wealth. But coal overcapacity also led to typical utilisation rates of below 50%, most coal firms losing money, and some going bankrupt. Approvals and permits were subsequently cancelled to soften the blow. Writing for Carbon Brief, Lauri Myllyvirta, Shuwei Zhang and Xinyi Shen dive deep into the issues, the voices for and against coal versus renewables, and the nation’s growing concern over energy security. Competition from cheap renewables, cross-regional electricity transmission, and pollution and climate targets could all make more coal in the 2020s a much bigger gamble than it was in the past.

China’s 14th five-year plan (FYP), setting out its national goals for 2021-2025, will arguably be one of the world’s most important documents for global efforts to tackle climate change.

The overarching plan for economic and social development in the world’s largest emitter is to be finalised and approved in early 2021, followed by more detailed sectoral targets over the next year. A power sector plan can be expected around winter 2021-22 (...) Read more

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An article from EnergyPost