CN fast-tracks coal plants despite climate pledges

POWER UTILITY

The local governments in China were found to have approved a total of 106GWs of new capacity in 2022, equivalent to two new coal-fired power plants per week, a report found.

The report, conducted by the Global Energy Monitor (GEM) and the Centre for Research on Energy and Clean Air (CREA), compared this to 100 large coal-fired power plants, the highest since 2015.

The permitted new capacity is also four times more than the 23GWs power plants recorded in 2021.

“If China is going to meet its climate commitments, as we expect, these new coal power plants are going to end up as short-lived and under-utilised malinvestments,” Lauri Myllyvirta, Lead Analyst, CREA, said.

“To meet China’s goal of peaking CO2 emissions, the most urgent milestone is to scale up investments in clean power generation to cover all of power demand growth, which means declining demand for power generation from coal.”

In addition, coal power projects were also fast-tracked with 50% more construction starts seen during the year. This is twice as much as the new capacity announced in 2021 and six times as large as the coal-fired power plants in the rest of the world. Further, around 60GW of projects green-lighted in 2022 have not started construction yet, but will likely start soon.

“China continues to be the glaring exception to the ongoing global decline in coal plant development. The speed at which projects progressed through permitting to construction in 2022 was extraordinary, with many projects sprouting up, gaining permits, obtaining financing, and breaking ground apparently in a matter of months,” Flora Champenois, Research Analyst, GEM, said.

“This kind of a process leaves little room for proper planning or consideration of alternatives.”

Electricity shortages

The report attributed the increase in new coal power capacity to the electricity shortages last summer due to a historic drought and heatwave in China. This has led to a rapid increase in peak loads were also recorded between 2021 and 2022 due to the hike in the use of air conditioners, prompting the market to develop new coal-fired powerplants. This also comes even as the Chinese energy regulator had said in early 2022 that no new coal plants would be permitted solely for bulk power generation.

GEM and CREA raised that China will need to improve energy efficiency requirements for air conditioning units and new buildings to avoid the need for new plants. China will also need to introduce a new program for largescale energy efficiency improvements for existing buildings.

Across the country, the largest amount of capacity was seen in Guangdong, Jiangsu, Anhui, Zhejiang, and Hubei.

The report found that provinces in China permit the construction of new coal-fired power plants in support of grid stability as well as the integration of clean energy. GEM and CREA, however, argued against this as the particular provinces that justified their coal plant projects were found to be laggards in growing their renewable energy generation.

China can control the construction of new coal-fired power plants by rejecting or revoking permits issued for projects that are not necessary for grid stability of renewable energy integration.

Moreover, the report also recommended that China should speed up its investment in renewable generation as well as electricity storage, flexibility, and transmission within grid regions. This includes creating a level playing field for different energy storage, demand response, and generation technologies, as well as boosting the scalability of clean flexibility technologies.