Analysis examines China’s coal push and its implications
Carbon Brief has assessed China’s recent efforts to boost coal production in analysis
published earlier this week. The article – written by Carbon Brief’s China editor, Xiaoying You
– took a deep dive into China’s current coal policy by interviewing a wide range of experts in and outside of China. Specifically, the piece examined why coal is important to China, what caused Beijing’s recent coal push and how the move might affect its climate actions. It also presented a host of views on whether or not the coal push would drive up China’s carbon peak level, which will have a knock-on effect on China and the world’s net-zero efforts. Furthermore, by citing experts, media reports and policy documents, the article explained what “clean and efficient use of coal” means – a concept China has repeatedly emphasised in the past few months.
All of the experts interviewed by Carbon Brief referred to last year’s power shortages as a direct driving factor behind China’s coal push. Byford Tsang
of E3G, an environmental climate change thinktank, highlighted a “shift in the rhetoric” towards coal by China’s leadership after the “power crunch” in 2021. But he noted that this did not represent a “policy shift” because the Chinese government had already underlined the importance of energy security and mentioned the “clean and efficient” use of coal while passing its 14FYP
in March 2021. In addition to the power shortages, Matt Gray
, co-chief executive of TransitionZero
, added that the “ongoing energy crisis and shortages internationally” is “probably a factor” behind Beijing’s “refocus” on energy security. He noted the situation is “obviously going to be exacerbated by the recent news of what is happening in Ukraine”.
The experts also shared their views on why China is still building new coal-fired power plants. Five new coal power projects with a combined capacity of 7.3 gigawatts (GW) were approved in the first six weeks of 2022, the analysis said, citing a recent report. Yu Aiqun
, China researcher at Global Energy Monitor, noted that the surge of approvals signified that “the direction of wind [in China’s policy-making] has changed” – from controlling pollution and emissions to ensuring economic growth and energy security. Yu also highlighted a “strong impulse” to build coal power plants in China. Meanwhile, some experts perceive new coal-fired power capacity as “necessary” to ensure a stable grid for meeting growing demand in the near term, according to Dr Ryna Cui
at the University of Maryland School of Public Policy in the US. She said: “One argument for that is to use coal plants for providing flexible peaking services to help support an increasing share of renewables in the grid.” The analysis also presented various opinions from other experts.
One key question the analysis examined is how the coal push would potentially affect the level of CO2 at which China will peak – something experts had different views on. For example, Dr Xie Chunping
– policy fellow at the Grantham Research Institute on Climate Change and the Environment in London – said that the push “will certainly affect” the level of China’s CO2 emissions in “the following few years”. But she said it “may not necessarily” affect the timing and level of China’s emissions peak, “as long as China starts to significantly reduce the utilisation rates of coal-fired plants and use them as backup capacity, once renewables build up”. Meanwhile, Dr He Gang
– assistant professor in the Department of Technology and Society at Stony Brook University in the US – said that China’s energy-related CO2 emissions reached 11.9bn tonnes last year, according to the International Energy Agency (IEA
). Dr He said that the figure “already exceeded” a previously discussed goal of 11bn tonnes in 2030 and a more aggressive goal of 10.5bn tonnes in 2025.
The analysis was published on the same day as China set the targets for the country’s energy-related works for 2022 in new “guiding opinions
”. The directives – published by the state energy regulator – are largely aligned with the 14FYP for energy, which emphasises energy security. The latest document carries some quantitative targets for the year. For example, it specifies that in 2022, the nation’s total energy production should reach “about” 4.41bn tonnes of standard coal equivalent (tce), its crude oil production should “return” to “about” 200m tonnes and its gas production should amount to “about” 214bn cubic metres. (According to Yicai
, a Shanghai-based news website, China’s crude oil production dropped below 200m tonnes in 2016 and kept declining until 2019. The outlet reported that China’s crude oil production was 199m tonnes in 2021. Refinitiv’s analyst, Jin Boyang, analyses the latest energy plan for Carbon Brief lower down.)
China explains pledge of no new overseas coal plants
Six months after China’s president Xi Jinping announced
that the country “will not build new coal-fired power projects abroad”, the Chinese government has provided some explanations for the one-line pledge, which sparked various interpretations
at the time. According to a new policy document published on Monday, China will “stop building new overseas coal power projects completely” and “push forward” those coal power projects that are under construction “steadily and cautiously”. It also stipulates that the country will “promote” the “green and low-carbon” development of those coal power projects that have been built, with instructions on how to achieve the goal.
The directives were released on Monday by four national-level government agencies in a set of “opinions” on the development of the “Belt and Road” Initiative
(BRI), China’s global infrastructure development strategy. (China Briefing has explained
the importance of “opinions” in China’s governing system.) The four agencies are the National Development and Reform Centre (the state economic planner), the Ministry of Foreign Affairs, the Ministry of Ecology and Environment and the Ministry of Commerce. According to state media
, all of these agencies are directly involved in leading the BRI, which was launched by Xi in 2013
At the United Nations General Assembly (UNGA) last September, Xi said that China “will not build new coal-fired power projects abroad” in a virtual address. Compared to that announcement, the directives go further by saying that China will stop building new overseas coal power projects “completely”. Dr Christoph Nedopil
– associate professor of economics at the Fanhai International School of Finance (FISF) of Fudan University in Shanghai – told Carbon Brief that as far as he knows, this is the first policy document that has publicly explained Xi’s pledge. Dimitri de Boer
– chief representative of the China office of ClientEarth, an environmental charity organisation – told Carbon Brief: “Although [Xi’s] pledge was already a top confirmation of the decision to do so, it is good to see this reaffirmation, and especially to see that there is no backsliding, in the face of the turbulent geopolitical situation today.”
Although the directives contain language on what China intends to do with those overseas coal power projects that are under construction, the wording can be “interpreted in several ways”, according to Dr Nedopil. He said: “Being aware that some negotiations on coal-fired power plants that have not reached financial close are still on the way, like the Gwadar
coal-fired power plant in Pakistan, it could mean that no new coal-fired power plants should be planned, while the ones in planning can still go ahead.” He noted that the instructions could also mean that “even the ones under construction can be re-evaluated”. De Boer said that the “ambiguity” of the language “may reflect an ongoing debate about exactly how to deal with existing projects – and exactly where to draw the line on ‘new projects’”. He added that the word “cautious” may “also suggest pulling out of projects, for example, if they encounter difficulties”.
ALREADY BUILT: In comparison, the orders for those projects that have already been built are more detailed. Specifically, the directives “encourage” those “relevant” companies to “enhance the clean and efficient use of coal”, reduce the emissions of sulphur dioxide (SO2), nitrogen oxides (NOx) and dust from the burning of coal and adopt “advanced” technologies, such as carbon capture, utilisation and storage (CCUS). De Boer said that this section “appears to refer to the retrofitting of existing coal plants” in the hope of making them “cleaner and/or more efficient”. He explained: “While that could be an improvement in some cases, there would be a risk of an increase in the lifetime emissions of such a project, especially if the retrofit involves an expansion in capacity.” De Boer added: “From a climate perspective, capacity expansions are very similar to new coal plants, so they should certainly not be allowed.”
The explanations have sparked discussions among China climate watchers on Twitter. In an explanatory thread
, journalist Liu Hongqiao (formerly of Carbon Brief) said that, before the latest directives, China had included Xi’s pledge in its updated nationally determined contribution
(NDC) and the 14FYP for energy
. Explaining her understanding of China’s language on those overseas coal power projects that are under construction, Zhang Xing – China energy policy analyst at the Centre for Research on Energy and Clean Air (CREA) – tweeted
: “‘Cautiousness’ is a very interesting word. I think it hides the possibility for China to stop the funding [for projects that are under construction] if they see a reason to do so.” Lauri Myllyvirta, CREA’s lead analyst, described
the new guidance as “formalising the ban on new overseas coal power projects”.