A study published Friday indicates that at least 18 new coal plant projects abroad will probably go ahead despite the pledge. At home, power shortages and fears of energy insecurity, worsened by turmoil in international fossil fuel markets from Russia’s war on Ukraine, have renewed convictions that China’s rich coal reserves must remain the country’s main energy source in the near-term.
China already consumes and produces about half the world’s coal and continued expansion output and capacity make achieving its climate goals look ever more remote.
On Wednesday, Premier Li Keqiang confirmed a goal of 300 million tons of new coal production capacity in 2022, up from 220 million tons added last year. In March, Chinese miners dug out more coal per day than ever before. Earlier this month, the government of Ordos city, a coal-extraction powerhouse in Inner Mongolia, approved plans to tap a 2 billion-ton coal-reserve spread across 65 square miles with expected output of 15 million tons per year.
Chinese leaders want to safeguard against another power crunch while also upgrading the sector to make it as efficient as possible, “but by relying this much on coal now, they’ll make future leaders’ job of really pushing decarbonization progressively harder,” wrote analysts at Trivium, a China-focused research firm, in a recent note. “It won’t be long before it becomes nearly impossible.”
Internationally, the Chinese ban on new overseas coal plants has led to 12.8 gigawatts of coal power being shelved or canceled, but the fate of a further 57 plants remains uncertain, according to the analysis by the Center for Research on Energy and Clean Air (CREA). Of those projects, 18 remain in a “gray area” where, despite no construction having taken place, they may go ahead due to having secured financing and permits.
Many of those plants are in Indonesia, which, like China, has been unwilling to abandon this readily available source of energy. Although the Southeast Asian country signed a COP statement pledging to transition away from “unabated” coal by the 2040s, it has been slower than neighbors like Vietnam to scrap projects.
Chinese companies have this year been contracted to build or supply parts to two coal power plants in Indonesia that are connected to industrial parks included in Chinese President Xi Jinping’s signature “Belt and Road” initiative to build infrastructure, trade ties and influence across Eurasia.
Because these projects are a priority for the local government, they are likely to go ahead “even though financing is drying up everywhere and domestic banks don’t have sufficient capital,” said Isabella Suarez, a researcher at CREA. Given Indonesia’s climate pledges, “it’s not really logical to continue building these projects that will have to retire early,” she said.
Xi’s announcement that China would stop building coal power plants overseas was among the most dramatic pledges to emerge from international negotiations ahead of the summit. It came after he had already pledged to “phase down” domestic coal production after 2025 as well as announced plans to peak the country’s carbon dioxide emissions before 2030 and reach carbon neutrality by 2060.
The Chinese government plans to meet those targets through a world-leading build out of renewable energy sources as well as more nuclear power plants. The rocky expanse of the Gobi Desert is set to become home to an additional 455 gigawatts of wind turbines and solar panels — more than double the total current capacity of the United States — by 2030.