China Slashes Coal Permits Amid Renewables Boom But Environmentalists Warn ‘Only Time Can Tell’ if Fossil Fuel Era Is Over

China approved 83% less coal power projects in the first half of this year compared to the same period in 2023. However, the country’s targets suggest more capacity will be added in the latter part of the year.

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The largest coal-producing country in the world has significantly curbed coal expansion in the first half of this year amid an unmatched deployment of renewable energy.

China, which last year generated a record output of coal, cut back on new coal power permits by 83% in the first half of 2024 compared to the same period a year ago, permitting only 12 projects totalling 9 gigawatts. It comes after the country approved 106 gigawatt’s worth of coal-fired power capacity in 2022, the highest amount since 2015, and another 70.2 gigawatt’s worth in 2023 – 95% of the world’s new coal power construction activity that year.

The drop in new coal project permits coincides with an unprecedented deployment of renewable energy that remains largely unmatched anywhere in the world. Using figures released by the Chinese government last week, CREA reported that the country’s solar and wind power generation has increased by 171 terawatt so far this year. This matches the amount the UK produced from all energy sources in the same period in 2023.

In June, China said it is aiming to reach a 39% non-fossil fuel power generation target by the end of 2025. In 2022, non-fossil energy power generation was 36.2%, according to government figures.

This year, China also halted permits for new coal-based steel mills, the country’s second-largest emitter after electricity. The move is the latest sign of a significant shift from unconditional industrial growth –particularly following the economic impact of Covid-19 strict restrictions – to the prioritization of cleaner, high-value growth. China’s 2024-25 Action Plan on energy conservation and emissions reduction further reinforces this shift. Unveiled in June, the plan singles out high-emitting industries such as steel production, petrochemicals, non-ferrous metals, and building materials, setting ambitious emissions reduction targets that authorities said will “make every effort” to meet.

Still, the new data, presented by the Centre for Research on Energy and Clean Air (CREA) in a press release on Thursday, also indicates “robust” coal power construction activity so far this year. According to CREA, a nonprofit think tank researching energy and air pollution, China has initiated 41 gigawatt’s worth of new projects since January. This represents 90% of new construction activities globally and is just shy of China’s total activity in 2022.

Too Early to Say Coal Era Is Over

China’s coal dependence remains high. The dirty fossil fuel, which is much cheaper compared to natural gas and oil, accounted for 60% of its power in 2023. What’s more, the country set a target of commissioning 80 gigawatts of coal-fires power capacity in 2024, which could translate in a surge in project completion from now until December, CREA said.

“It’s been clear to me for some time that there would have to be a course correction, as the amount of new coal power projects permitted in 2022-23 was clearly excessive,” said CREA’s Lead Analyst Lauri Myllyvirta. “While permitting slowed down significantly, there is still a huge amount of capacity under construction and due to come online as a result of the wave of permitting in 2022-23. More than 40 GW of new projects started construction in the first half. Further measures will be needed to manage the resulting overcapacity.”

Greenpeace East Asia Beijing-based project lead Gao Yuhe said on Tuesday that despite the encouraging data, “only time can tell” if this is the beginning of the end of China’s coal era. “A rebound remains possible until there are firm measures put in place to directly prevent further coal expansion. And without more proactive support for wind and solar grid connectivity, a post-peak plateau remains a risk,” Yuhe said.

The burning of coal, natural gas, and oil for electricity and heat is the single-largest source of global greenhouse gas (GHG) emissions, the primary drivers of global warming by trapping heat in the atmosphere and raising Earth’s surface temperature. Global fossil fuel consumption has more than doubled in the last 50 years as countries around the world have worked to improve their standards of living and economic output. However, scientists have long warned that curbing fossil fuel extraction and consumption is the only way to halt global warming and secure a liveable future.