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China’s recent economic growth has brought with it difficult environmental challenges, including severe and large-scale air pollution that has affected most major cities.

This stems from China’s increasing energy needs over the last decade, its heavy reliance on coal for power generation, and its consumption of coal for other purposes such as infrastructural development. Recently, pollution-related health issues coupled with the central government’s strong will to coal power overcapacity has the potential to steer China away from future coal power development.

Having said that, whether coal power’s dominant share in China’s existing power mix can change in the next decade remains the subject of much uncertainty. This is partly due to China’s rigid grid structure and transmissions bottleneck and partly due to the perpetual “push-and-pull” between environmental goals and other development objectives. In addition, China’s coal and power industries are expected to see more mergers in the near future because of state-owned enterprise reform policies that were announced in early 2017.

These reforms are particularly important to Chinese leaders when thermal coal prices are high and volatile. However, these potential mergers could shield the coal-fired power plants from unfavorable market conditions and signals that would otherwise have shut them down.

Existing and Proposed Coal Power Generation Capacity (GW)
Coal Consumption (2016)
Coal Production (2016)
Energy System CO2 Emissions (2016)
Electricity Generation by Fuel (2000)
Electricity Generation by Fuel (2000)

For more information on the methodology and data sources, please consult the Technical Report