全球能源監(jiān)測-隨著更多省份加入中國新的煤電熱潮仍在繼續(xù)（英）

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Briefing,August2023

China?snewcoalpowerspreecontinuesasmoreprovincesjumponthebandwagon

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Keyfindings

●Thecoalpowerplantpermittingspreethatstartedinsummer2022hascontinuedinthefirsthalfof2023andintoJuly.FromJanuarytoJune,constructionwas

startedon37GW(gigawatts)ofnewcoalpowercapacity,52GWwaspermittedofwhich10GWalreadymovedintoconstruction,while41GWofnewprojectswereannouncedand8GWofpreviouslyshelvedprojectswererevived.Allofthesepartsoftheprojectpipelinearecurrentlyrunningatapaceofmorethanonecoalpowerplantperweek.

●Mostofthenewprojectsdon?tmeetthecentralgovernment?srequirementsfor

permittingnewcoal:theprovincesbuildingmostnewcoalaren?tusingitto

“support”acorrespondinglylargebuildoutofcleanenergy;themajorityofprojectsareinprovincesthathavenoshortageofgeneratingcapacitytomeetdemand

peaks;andmostnewprojectlocationsalreadyhavemorethanenoughcoalpowerto“support”existingandplannedwindandsolarcapacity.Thisshowsthatthereisnoe?ectiveenforcementofthepolicieslimitingnewprojectpermitting.

●152GWhasbeenpermittedand169GWannouncedsincethestartofthecurrentspreeinearly20221.ThismeansthatChinaisacceleratingtheadditionsofnewcoalpowercapacityduringthecurrentfive-yearplanperiod(2021–25)comparedto

eitheroftheprecedingtwofive-yearplanperiods.

●Chinanowhas243GWofcoalpowerunderconstructionandpermitted.When

projectscurrentlyannouncedorinthepreparationstagebutnotyetpermittedareincluded,thisnumberrisesto392GW.Thismeansthatcoalpowercapacitycouldincreaseby23%to33%from2022levels,implyingeitheramassiveincreaseincoalpowergenerationandemissionsoramassivedropinplantutilization,implying

financiallossesandpotentiallyassetstranding.

●Unlesspermittingisstoppedimmediately,Chinawon?tbeabletoreducecoal-firedpowercapacityduringthe15thfive-yearplan(2026–30)withoutsubsequent

cancellationsofalreadypermittedprojectsormassiveearlyretirementofexistingplants.

1A?erupdatestothedata,wehaverevisedthenumberofpermittedplantsin2022:148unitswithatotalcapacityof100GW.

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Franticpermittingandconstructioncontinuedinthefirsthalfof2023

Inthefirsthalfof2023,constructionwasstartedon37GWofnewcoalpowercapacity,52GWwaspermitted,while41GWofnewprojectswereannouncedand8GWofpreviouslyshelvedprojectswererevived(seeFigures1and7).Ofthepermittedprojects,10GWofcapacityhasalreadymovedtoconstruction.

NewprojectactivityacceleratedmostdramaticallyinthecoastalprovincesofJiangsu,ShandongandHebei,andintheinlandprovincesofInnerMongolia,ShaanxiandGansu(seeFigure5).Guangdong,whichledthechargein2022,continuedinitiatingand

permittingmorenewprojectsthananyotherprovince.Permittingprocesseso?encontinuedtooccurat

record

speeds.

Permittingcontinuedapaceinthesecondquarter,despitecritical

publicstatements

on

newcoalplantpermittingfromsenioro?icials.PermitissuanceacceleratedfurtherinJuly,withnolessthan

10GW

approvedaccordingtoSouthwestSecurities.InearlyAugust,

Shandong

revised

itslistof

keyprovincialprojects

fortheyear2023,withfivemajorcoalpowerprojectsaddedandonlyonecoalpowerprojectremovedfromthelist.

Insomeprovinces,newlypermittedpowerplantsaremovingrapidlyintoconstruction,whileinothersdevelopersmightbesecuringpermits“justincase”andnothurryingto

breakground.Ofplantspermittedin2022,abouthalf(52GW)hadstartedconstructionbysummer2023.

Thepushfornewcoalisseeingsomelong-dormantprojectsrevived.Forexample,

HuanengShanyin2×1,000MWcoal-firedpowerprojectwas

proposed

in2011buthadnoprogressuntilMarch2020.Evena?erbeingrevivedin2020,theprojecthadbeen

progressingslowly.However,Shanxiprovince?sDevelopmentandReformCommissionsuddenly

granted

itapermiton29July.

Coalpowerplantcommissioningdoubledyear-on-year,with17.1GWaddedtothegridinthefirsthalfof2023.Thisisthefirsttimethattheresultsoftheacceleratedpermittingofnewprojectsandrestartingofsuspendedprojectsin2020areseen.Permittingwas

increaseda?erthestartoftheCOVID-19pandemicinearly2020,andprojectsthathad

beensuspendedearlierwererestartedasovercapacitypoliciesexpiredattheendof2020.Therestartedprojectsweresuspendedunderovercapacitypoliciesissuedin2017,a?era

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massiveglutofpermitsissuedbylocalgovernmentsin2015–16.Halfoftheplantsstarting

operationwerepermittedin2020,andmostoftherestwereprojectsrestarting

constructionin2020,showingthatconstructionprogressedatarapidclip.Muchmorecoalpowerisusuallycommissionedinthesecondhalfoftheyear,butthenumberofplants

commissionedinthefirsthalfof2023isstrikingfortheperiod,especiallyasthe

accelerationonlyhappenedinMay–June.ThecapacityadditionsweredrivenbyInnerMongolia,Shaanxi,GuangdongandZhejiang.

Figure1:Surgeincoalpowercontinuedinthefirsthalfof2023:anaverageoftwocoalpower

plantsreceivedpermitsandmorethanonestartedconstructionperweek.Changesincoalpowerstatusbyhalfyear(GlobalCoalPlantTracker).Categoriesarenotmutually

exclusive–e.g.plantsthatbothobtainedpermitsandstartedconstructionin2023H1areincludedinbothcategories.

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Permittingneedstostopinorderforinstalledcoalpowercapacitytofallinthenextfive-yearperiod

Thecurrentspreeofnewprojectsandpermittingisbuildingupanincreaseincoalpowercapacityinthe2026–30period(seeFigure2)whenChina?scoalconsumptionissupposedtobereduced,basedonapledgemadebyPresidentXi.Itispossibleforcoalconsumptiontopeakwhilecoal-firedpowercapacitycontinuestoriserapidly,butthisoutcomewouldmeanrapidlyfallingutilizationoftheplants.

A?erthepermittingspreeofthepastyear,Chinanowhas243GWofcoal-firedcapacitycurrentlypermittedandunderconstruction.Withalloftheseplantscomingonline,

stoppingtheincreaseincoalpowercapacityinthe2026–30periodwillrequirea

significantaccelerationintheretirementofexistingplants.Retirementshave,tothecontrary,sloweddowninrecentyears.

Ifthepermittingrushisnotstoppeduntilprojectsthatarecurrentlyannouncedorinpre-permitstageshavegainedpermitsaswell,therewillbeatotalof392GWofnewcoal-firedpowercapacityinthepipeline.

Unlesspermittingisstoppedimmediately,Chinawon?tbeabletoreducecoal-firedpowercapacityduringthe15thfive-yearplanwithoutsubsequentcancellationsofalready

permittedprojectsormassiveearlyretirementofexistingplants(seeFigure2).

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Figure2:CoalPowerCapacityTrajectoriesinChina:howChina?sdecisionsonpermittingwillshapetheinstalledcoal-firedpowercapacitylandscapeinthecrucialperiodleadingupto2030and2040.Iftheannouncementsandpermittingprocessesunderwaycontinue,total

installedcapacityisprojectedtopeakat1,450GWin2029,andifpermittingisstoppednow,itisprojectedtostartfallingsooner,peakingat1,340GWby2027.

Theprojectionsassumethatcoalpowerplantsretireatthecurrentmedianageof32years,andthatallnewprojectscurrentlyunderconstructionorpermittedarerealized.

Retirementofplantsthatarecurrentlyolderthan32yearsisspreadacrosstheperiod

2024–30.Theleadtimefromprojectannouncement,permittingandconstructionstarttocommissioningisbasedontheaveragesforprojectsintheGEMdatasetintheperiod

2015–23:4.5yearsfromannouncement,3.5yearsfrompermittingand3.0yearsfromconstructionstarttocommissioning.

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Mostnewcoalpowerprojectsdon'tmeetthecentralgovernment?srequirements

Theo?icialpolicyoncoalpoweristhatcleanenergyshouldbecomethe“mainstay”ofthepowersystemwhilecoalmovestoa“supporting”role.Newcoalpowerplantsshouldnotbepermittedforthepurposesofbulkpowergeneration,butonlytosupportgridstabilityandrenewableenergyintegration.However,ananalysisoftheprojectspermittedin

2022–23showsthat:

●Theprovincesaddingmostcoalpowerplantsaregettingmostoftheirpower

generationfromcoal,notfromcleanenergysources.Thisshowsthatallofthese

provincesarestillrapidlyincreasingbulkpowergenerationfromcoal,ratherthanusingcoalasa“supporting”source.Amongthetop10provincesfornewcoal

powerprojects(seeFigure5),theshareofthermalpowerinpowergeneration

growthwashighinseven:Zhejiang(85%),Guangdong(80%),Anhui(75%),Shaanxi(75%),Xinjiang(65%),InnerMongolia(60%),andGansu(50%).Hebeiand

Shandonghavebeenreducingthermalpowerrecently,andJiangsuhasgotten45%ofitspowergenerationgrowthfromthermalpower(seeFigure3).2

●Mostlocationsinwhichnewcoalpowerplantsarebeingbuiltalreadyhavealotofexistingcoal-firedcapacity,andnotenoughplannedsolarorwindcapacityto

justifytheadditionofnewcoalpower(seeFigure4).Forinstance,Hubeihas24GWofwindandsolarpower,comparedto36GWofcoaland36GWofhydropower,foralmostthreetimesasmuchdispatchablecapacityasthereisvariablecapacity.ForGuangdong,thisratioisfour.Jiangsuhasastaggering105GWofcoalandgas-firedcapacitycomparedtoits52GWofwindandsolarcapacity.Similarly,Fujian

possessesacoalandgas-firedcapacityof37GW,overshadowingits14GWofwindandsolarpowercapacity.3

●Only47outofthe216coalpowerunitspermittedin2022–23,representingabout16%ofthepermittedcapacity,areinlocationswheretheexistingandplannedlarge-scalesolarandwindcapacityexceedsexistingandplannedcoalpower

capacitybasedonbestavailableinformation.Inmorethanhalfofthelocations,thereismorethanthreetimesasmuchcoalasknownlarge-scalewindandsolarcapacity.4

2Province-levelgenerationdatafromChinaNationalBureauofStatisticsviaWindFinancialTerminal.3DataasofendofMay2023fromWindInformation.

4Thisresultwasobtainedbyidentifyingallexistingandnewcoal,solarandwindpowerplantswithinagivendistanceofeachnewlypermittedcoalpowerproject,fromtheGEM

GlobalWindPowerTracker

and

Global

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●60%ofnewlypermittedplantsandplantsstartingconstructionareingridregionsthat

alreadyhaveovercapacity

incoal-firedpower.

Figure3:Sourcesofgrowthinpowergeneration,comparingtheperiodfromJune2022toMay2023totheperiodfromJanuarytoDecember2020.

SolarPowerTracker

(May2023releases).GEMcatalogsallsolarinstallationsgreaterthan20MWandallwindinstallationsgreaterthan10MW(see,e.g.,

datagapsandfutureresearch

).Theresultsarereportedhereforadistanceof100km,butarerobusttotheuseofanydistancefrom10to300km,withtheshareofprojects

havingmorenewlarge-scalewind&solarthancoalaroundthemvaryingfrom0to20%dependingonthedistancechosen.

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Figure4:Existingandnewcoal,solarandwindpowercapacityoverlaidonthemap.Mostlocationswheresolarandwindarebeingaddedalreadyhavealotofcoal-firedpower,andonlybureaucratichurdlespreventitsusetosupporttheintegrationofvariablepower

generation.Thereareareas,particularlyinwesternChina,wherenooperatingcoalpowerexistsatthemomentinlocationswithlargewindandsolardevelopments,butthese

representasmallfractionofChina?stotalcoalpowerbuildout.

Theo?icialjustificationsforthecoalpowerspreearesupportinggridstability,whichrefersabovealltomeetingmomentarypeakloads,especiallyduringsummer;aswellas

supportingtheintegrationofvariablewindandsolarpowergeneration.However,thesejustificationsapplyatmosttoaminorityoftheprojectspermittedsincethebeginningof2022.Thisshowsthatthereisnoe?ectiveenforcementofthepolicieslimitingnewprojectpermitting.

Onthenationallevel,Chinahasenoughgeneratingcapacitytomeetpowerdemand,alsoduringsummertimedemandpeaks.Thereasonthatthereareshortagesistheinflexibleandoutdatedwaythatthegridisbeingoperated.Thishasbeenhighlightedimplicitlyalso

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bysomeChineseexpertswhohave

called

for

moree?icient

useofexistingcoalpowercapacityratherthanconstructionofnewcapacity.

Whilepowershortagesarefrequentlycitedasamajorreasonfortheconstructionofnewcoalpowerplants,therationaleiso?enmisused.60%ofnewcoalpowerprojectsarein

gridregionswherethere?salreadyanexcessofcoal-firedpowercapacity.Take,for

example,provinceslikeShandongandGuizhou.Despitetheseareasalreadyhavingahighreservemargin,indicatinganovercapacity,theycontinuetochampiontheconstructionofadditionalcoalpowerplants.Forexample

●TheNorthChinaregionhad364GWofthermalpoweragainstapeakloadof251

GW.YetwesternInnerMongolia,ShandongandHebei,regionsthatareapartoftheNorthChinagrid,areamongtheonespursuingthelargestamountofnewcoal

powercapacity.

●TheCentralChinagridregionhad200GWofthermalpowercapacityand159GWofhydropowercapacityattheendof2022,tocoverthehighestreportedpeakloadof139GW.Yetseveralprovinces,particularlyHubei,aregreenlightingmorecoal.

●TheNorthwesternChinagridregionhad185GWofthermalpowerand36GWof

hydropoweragainstapeakloadof115GW.Yet,XinjiangandGansuarebuilding

newcoalpowerplants.Ontheregionallevel,onlytwogridregions,theeasternandsoutherngrids,haveatightcapacitysituationandareatriskofpowershortages.Thesegridregionswouldneedimprovementstogridoperation,including

increasedimportsfromotherregions,and/orinvestmentinflexibilityandstoragesolutions,toavoidtheneedfornewcoal-firedpowerplants.

Ouranalysismakesitclearthatnewprojectsarenotbeingscrutinizedandtheconditionsfornewcoalprojectsspecifiedincentralgovernmentpoliciesarenotbeingenforcedinpractice.Itappearsthatthecentralgovernmentisencouragingcoalpowerinvestment

withfewifanypreconditions,asapartofe?ortstoo?settheweaknessinotherpartsoftheeconomy.

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Whatisdrivingthenewprojects?

Coalpowerpermittingwasfirstloosenedinearly2020,astheCOVID-19pandemicbrokeoutandthegovernmentwaslookingtousemajorinvestmentprojectstopropup

economicactivity.Thevenerablerushofpermitsstarteda?erelectricityshortagesinthesummerof2022.

However,asdiscussedabove,mostofthenewlypermittedprojectscannotbejustifiedbyshortagesofpowergeneratingcapacity.Rather,theelectricitysupplyscareopenedupawindowofopportunitytopushnewcoalpowerprojectspastgovernmentregulators,astheelectricitysupplyscareinafewprovincesledtoashi?incentralgovernmentpolicy.

In2023,newprojectactivityhasacceleratedmostdramaticallyintheinlandprovincesofInnerMongolia,ShaanxiandGansu,andcoastalprovincesofHebeiandShandong.

Guangdong,whichledthechargein2022,continuedinitiatingandpermittingnewprojects(seeFigure5).

Figure5:Changesinstatusofcoalpowerplantsandprojectsinthefirsthalfof2023.

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Outdatedgridmanagement

TheapparenttriggerforthecurrentcoalpowerrushwastheSichuanpowershortagein

thesummerof2022.Morebroadly,Chinahasseenarapidincreaseinelectricpeakloadsin2021–23.Thisisinlargepartduetoanincreaseintheprevalenceofairconditionersand

exceptionallyintenseheatwaves.

Increasingpeakloadsareincreasingtheriskofpowershortagesinsomebutnotall

provincialandregionalgrids.ThisishappeningbecauseofChina?srigidgridoperation

paradigm,asdiscussede.g.intheCREAandWaterRock

report

“Resolvingnear-termpowershortagesinChinafromaneconomicperspective”Forexample,one-thirdofelectricity

productioninSichuanprovincewasexportedinlinewithnationalpowerdispatch

planning.Duringthedroughtin2022,Sichuancontinuedtoexportlargeamountsof

electricitytotheeast,whilerationingconsumptionwithintheprovince.Thelackofflexiblegridmanagementperpetuatesrelianceoncoalpowerandcreatesaperceivedneedto

buildmoreofit.

Theincreaseinpeakloadsisthereforepromptinganincreaseincoalpowerplant

developmentasacostlyandsub-optimalsolution,especiallyinmajorelectricitydemandcentresandprovincesneighboringthem.

Buildingcoal-firedpowerplantstocoverpeakloadsmeanslowutilizationof

capital-intensiveassets,makingitanexpensivewaytosolvetheproblemeveninthe

absenceofclimatetargets.Inaddition,China?scarbonneutralitycommitmentmeansthatthelifetimeofnewcoalpowerplantswillbeverylimited,furtherdrivingupthecosts.

Furthermore,whiletheconcernaboutpeakloadsinsomeprovinceswastheinitialreasonthatthecentralgovernmentloosenedcontrolsonnewcoalprojects,thewaveofprojectshasswollenfarbeyondthoseprovincesinwhichthisisaconcern,andtoamuchlarger

scalethanneededtoaddresstheissue.

“Climbingtothepeak”:Thenextfiveyearsasawindowtogrowemissions

Therushtobuildnewcoalpowerplantsandcoal-basedindustrialplantsrepresentsthementalityof“climbingtothepeak”

China?sClimateTransition:Outlook2022

,areportbyCREA,highlightedthatmanyo?icialsandexecutivesinChinaseethenextfiveyearsasawindowofopportunitytoaddnewcarbon-intensivecapacity.Thisisaperiodwhere

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emissionsarestillallowedtoincreasebeforetheyareduetopeakunderChina?sCO2peakingpledge.

Evenifcoalpowergenerationissteeplylossmaking,state-ownedenterprisestendtocaremoreaboutmarketsharethanaboutprofitability,andbuildingmorecapacityisawaytograbmarketshare.

Profitabilityofcoalpowergenerationisalsofullydeterminedbythegovernment,which

controlsprice-settingforpowergeneratedfromcoal.Theexpectationisthatwhencoal

powerprojectsareencouragedbythecentralgovernment,thegovernmentwillmake

developerswholeoratleastnotpunishexecutivesando?icialswhopursue,permitand

financetheprojectseveniftheyendupasfailureseconomically.Onewayinwhichthe

fortunesofcoalpowerplantscouldchangeistheintroductionofcapacitypayments,

whichwouldseecoalpowerplantoperatorscompensatedforprovidingavailablecapacityevenwhentheyarenotgeneratingpower.Thegovernmentworkplanforthisyearincludesstudyingthecreationofacapacitypaymentmechanism.

Centralgovernmentbackingisapparentinthemixofprojectdevelopers.In2017–2021,

newprojectdevelopmentwasledbyprovincialstate-ownedenterprises(SoEs),with

centralgovernmentfirmsstartingveryfewprojects.However,inthepasttwoyears,centralgovernment-controlledfirmshavebeengainingshareandwereresponsiblefor45%of

newlypermittedprojectsinthefirsthalfof2023(seeFigure6).

BecauseoftheChinesegovernment?spropensityforabruptshi?sinpolicy,thereisa

self-reinforcing“coalrush”dynamic:whenamassiveamountofpermitsishandedout,marketparticipantsexpectthatthegovernmentwillclampdownontheexcessessoon,whichbecomesareasontograbasmanypermitsaspossiblebeforethemusicstops.Thisdynamicplayedouttheprevioustimeinthesimilarlylargecoalplantpermittingwaveof2015–16,whichwaspromptly

followed

byaclampdownfirstonnewpermittingandthenonalreadypermittedprojectsin2017.Toavoidrepeatinghistory,manyprojectswere

rushedintoconstructionassoonaspermitsweregranted.Asmentionedearlier,10GWofthe2023permittedprojectshavealreadymovedtoconstruction.

Coalminersmandatedtoinvestinpowerplants

Therecentriseincoalpriceshasdrainedtheprofitabilityofcoalpowergenerators,whilefillingtheco?ersofcoalminingfirms.Thisisarecurringdynamicduetothefactthat

powerpricesinChinaareconstrainedbygovernmentregulation,butpricesforthecoal

usedinpowerplantsaredeterminedinamoremarket-basedway.Todistributethemisery

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moreevenly,andenabletheconstructionofnewcoalplantsdespitethepoorbusinesscase,thegovernmenthaspushedcoalminingfirmsto

takeonstakes

inthepower

generationbusiness.

Since2022,coalconglomerateshavebecomethemaininvestorsinnewcoalpower

projectsinChina.

ChinaCoalGroup

hastakentheleadindevelopingnewminemouth

powerplantsinInnerMongolia,while

ShaanxiCoalandChemicalIndustryGroup

has

revealedplansfornewcoalpowerinShaanxi.Coalminingfirmshavealsotakenon

existingcoalplantstocleanupthebalancesheetsofpowergenerators,withfivemajorpowercompaniesselling23loss-makingcoalplantsin2022,withcoalenterprisestakingovermostofthem.

Theverticalintegrationofcoalminingandcoalpowergenerationreducesthefinancialriskfromcoalpricefluctuations.However,thisapproachstillmakescompaniesshouldertheburdenofgovernment-controlledelectricityprices.Andsuchintegrationinlarge-scale

makesiteasierforthegovernmenttocontrolthesector,andencouragesaboomof

coal-powerinvestment,thushinderingthepowersector?smarket-orientedreformsandenergytransition.

Doublingup:Exporterstoincreaseexportswhileimporterswanttocutback

Sincethe11thfive-yearplan(2011–15),thecentralgovernmentandStateGridhaveaimedtomovecoalpowergenerationtoChina?swesternandinlandprovinces,andcentralizeitto“coalpowerbases”linkedtothedemandcentresintheeastbyverylongdistance,

ultra-highvoltagetransmissionlines.The“coalbases”havemorphedinto“cleanenergybases”inthemostrecentfive-yearplan,comprisingamixofrenewableandcoal-firedpowergeneration.

Themotivationsfortheplanincludestimulatingeconomicgrowthinthewest,centralizingthecoalminingindustryandeliminatingmininginmoreprosperousareas,increasingtherelativecompetitivenessofdomesticcoalandreducingtheneedtotransportcoalfrom

inlandtothecoast.

Asapartofthiswest-to-eastpowertransmissionplan,westernprovincessuchasInnerMongoliaandShaanxihavebuiltvastamountsofminemouthcoalpowercapacitysolelyforthepurposeofexportingpowertoeasternprovinces.

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Easternprovinceswhichareexpectedtopurchasethepower,suchasZhejiang,Jiangsu,ShandongandGuangdonghavebeenloathtoincreaseimportsofelectricity,resultinginaverylowrateofutilizationforthelong-distancetransmissionlines.Theseprovincesprefertorathergeneratethepowerlocally,capturingthevalue-addedintotheirprovincialGDP,alongwiththetaxrevenueandjobs.

Anotherfactorthatbecameapparenta?erSichuan?spowershortageinsummer2022isdistrustbetweenprovinces.ThemajorhydropowerprovincesinsouthwesternChina

su?eredfromseriousdroughtbothin2022and2023.Whiletheycurtailedlocalpowerconsumptionandcontinuedtoexportpowertootherpartsofthecountry,thedroughtsraisedconcernsaboutthereliabilityofthissupplyinthelongerterm.

Thepowershortageprovidedcoastalprovinceswithanexcusetoshi?backtogeneratingpowerwithintheprovinceandtheyjumpedontoit.

GuangdongandShandongrecentlyrevisedtheirenergyplanstoaccommodatemajor

increasesincoalpowercapacity,barelyayeara?erreleasingtheirfive-yearplansinearly2022.Bothprovinceshadaimedtolimitincreasesincoalpowercapacity,reflectingthecentralgovernmentpolicyatthetime.

InMarch2023,Shandong?sEnergyBureauannounced

plans

toadd10GWofcoalpowerinthenextthreeyears.Theprovince?searlierfive-yearplantargetedcoal-firedcapacityofnomorethan100GWby2025,a10GWreductionininstalledcapacityfromthelevelatthe

endof2022.

Thepushforcoalpowerincoastalprovincesintroducesamajorredundancyaswestern

provincesarestillbuildingmorecoal-firedcapacityforexporttotheeast,whileeastern

provincesarebuildingnewcoaltoreplaceimportsfromthewest.Insomecases,provincesneighboringthemaineconomiccenters,suchasAnhuiandFujian,arealsobuildingnewcoalplantswithexportsinmind,creatingathirdlayerofredundancy.

Thecompetitionbetweenimportingandexportingprovincesisillustratedbythetwoprovincestoppingthelistoflargestdevelopersofnewcoalpowerprojects:GuangdongandInnerMongolia,thelargestimporterandexporterofelectricityamongChina?s

provinces,respectively.

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Guangdong:backpedalingoncleanenergywhilepromotingcoalpower

ThechangestoGuangdong?senergyplansmakeitclearthatdespitetherhetoric,thenewwaveofcoalpowerprojectsisnotsupportingbuthinderingtheuptakeofcleanenergy.

Inits

14thFive-YearEnergyDevelopmentPlan

,publishedinMarch2022,Guangdong

highlightedtheneedtostrictlycontrolcoalpowerprojectsandreducetheproportionofcoalpower.

Inanunusualstep,Guangdongreviseditstargetsjustayearlater,announcinga

2023–25

energydevelopmentplan

inMay2023,withenergysecurityasthemainslogan.Theplanaimstocommission13GWofcoalpowerby2025.Comparedtolastyear?sfive-yearplan,theproportionofnon-fossilenergyinstalledhasbeenreducedbyfivepercentagepointstoabout44%.Theproportionofnon-fossilenergyconsumptionhasdecreasedbythree

percentagepointsto29%,andanadditional6.7GWofkeycoalpowerprojectshavebeenadded.

Guangdong?s

keypowergenerationconstructionprojects

fortheyear2023include31GWofcoal-firedpower,27GWofgas-firedpower,9.7GWofnuclearpower,8.5GWofo?shorewindpower,and5.9GWofphotovoltaicpower.Giventhesefigures,itishardlyappropriatetolabeltheupcominglarge-scalecoalandgaspowerprojectsas“supportive”,sincetheyrepresenttheclearmajorityofnewcapacity.

AfurtherblowtothecleanenergytransitioninGuangdongwasa

notice

issuedbythe

province?sEnergyBureauinJuly,“advising”tosuspendapprovalofsolarandonshore

windprojectsduetonaturalresourcesconstraints.Constructionhasalsobeentemporarilypausedonapprovedbutnotyetstarted