China’s coal strategy threatens to burn global net zero hopes

China’s programme of rapidly increasing its coal production is putting the world’s efforts to limit global warming in serious danger.

In a new report climate think tank E3G said the decisions by China to increase coal production to ensure energy security threatened to derail any efforts to combat climate change and meet the world’s net zero ambition by 2050.

E3G said: “Ending the construction of new coal power is a critical milestone towards achieving the goals of the Paris Agreement. The IPCC and the IEA are clear that no new unabated coal power plants can be built if the world is to limit warming to 1.5°C.”

Outside of China the news has been positive with the scale of proposed new coal power capacity down by 84% since the 2015 Paris Agreement, with reductions of 90% in OECD / EU and 83% in non-OECD countries.

Aside from China, all world regions saw a decline or plateau in the scale of new coal under consideration in the second half of 2022. Only seven coal projects were proposed in the entire world outside China: six reactivated projects in India and one new project in Indonesia. This is the smallest number of new projects proposed in any half-year period since 2015.

As of January 2023, 98 countries had either explicitly committed to no new coal or had considered coal in the past decade but no longer have any active planned projects.

However, the organisation said in the second half of 2022 saw the largest ever increase in new coal plant permitting in China, accompanied by significant spikes in new project proposals and construction starts. As a result, China now accounts for 72% of global pre-construction capacity, up from 66% in July 2022.

“China’s hasty prioritisation of new coal is at odds with the significant global trend away from new coal,” it added. “It would be a costly detour.

“The significant scale of China’s coal expansion plans directly threatens the 1.5°c temperature goal of the Paris Agreement. China itself will be loading its economy with stranded assets, undermining its global leadership on renewables deployment, and challenging the credibility of its climate commitments.”

Leo Roberts, programme lead at E3G said: “Almost every country and region in the world has stopped planning new coal power stations and many have now cancelled all remaining projects. This is a huge step towards keeping global heating below 1.5°c. Unfortunately, a renewed coal boom in China is sending it off on a diverging pathway from the rest of the world, at potentially massive cost to the climate, and to China itself.”

Many proposed new coal plants in China are yet to start construction, accor9odg to E3G. The question is whether the central government can swiftly rein in provinces and power companies before new constructions proceed, putting a lid on new coal ahead of China’s next Five Year Plan in 2026.

“This is the best way for China to recommit to a sustainable energy transition, reduce the economic risks of locked-in coal power for decades, and deliver on its climate leadership responsibilities.”

Belinda Schäpe, Policy Advisor at E3G said: “Ensuring China’s energy security through more coal capacity is an illusion. As the world turns its back on coal, China has little to gain from clinging to the dirtiest of fossil fuels. As a responsible power, China can showcase its commitments to tackling climate change and the green transition – leading by example.”

Byford Tsang, Senior Policy Advisor at E3G added: “The coal resurgence across the country is a direct challenge to President Xi’s promise to rein in coal. Ending the coal plant building spree should be a priority for China’s new cabinet. Doing so will save China from a costly detour on its energy transition and position China as a front-runner on climate.”