Despite continued growth in coal-fired power generation, China reached a momentous milestone in clean energy in the first half of the year, as rising hydropower, solar, and wind output pushed down the share of coal in power generation to below 60% for the first time ever.
While it is too early to toast a successful Chinese energy transition, the decline in coal's share—largely helped by soaring hydropower after two years of drought—is the latest chapter in a trend in recent years. China's share of clean power has been rising, while the share of fossil fuels has been shrinking over the past decade.
The share of clean energy in China's power output hit a record high of 37.3% in the first half of 2024, according to data from energy think tank Ember cited by Reuters columnist Gavin Maguire.
Meanwhile, the share of fossil fuels fell to 62.7%, down from around 65% throughout last year. [if !supportLineBreakNewLine] [endif]
Why Coal Share is Falling
Of the fossil fuels share, coal held a 59.6% share of total Chinese power generation. That's very high compared to the world average, but a record-low share for China. It is the first time coal has held a share of below 60% of China's total electricity output.
Certainly, the decline in coal's share has been partly due to soaring output from solar farms and higher wind power generation. But it is hydropower that likely played the biggest role in the falling share of coal in China's total electricity output.
Following nearly two years of droughts and meager rainfalls in 2022 and 2023, heavy rains in the spring filled water reservoirs and lifted the capacity utilization of China's massive hydro dams.
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China has the biggest hydropower capacity in the world, at a total of 425 gigawatts (GW), including the world's biggest dam, the Three Gorges. Even in 2022, when the drought shrank hydropower output, the country sourced 15% of its electricity from that segment, according to BloombergNEF. This was more than the share of wind and solar in China's energy mix.
Coal demand for power generation in China is set to be lower than previously thought due to high rainfall boosting hydropower production, China's Coal Transportation and Distribution Association said in May.
In contrast, during the first half of 2023, coal production, coal imports, and coal-fired electricity generation jumped and offset a significant decline in power output at China's massive hydropower capacity due to insufficient rainfall and drought. Rainfall in the Yunnan province in China dropped by more than 60% yearly during the first four months of 2023. Renewables helped to partially offset the crippled supply from hydropower generation last year, but coal saved the day.
This year, double-digit growth in China's hydropower output pushed coal's share of electricity generation down to below 60%.
Coal-fired output continued to rise, as did all other power sources amid growing electricity demand in China. But the rise in coal generation was outpaced by much higher increases in hydropower and solar output.
For example, thermal power generation increased by 3.6% in January to May compared to the same period of 2023, per data from China's National Bureau of Statistics. At the same time, hydropower generation jumped by 14.9%, and solar power output surged by 25.3%.
In May 2024 alone, clean energy generated a record-high 44% share of China's electricity, pushing coal's share down to a record low of 53%, despite continued growth in demand, Lauri Myllyvirta, senior fellow at Asia Society Policy Institute and lead analyst at the Centre for Research on Energy and Clean Air (CREA), wrote earlier this month.
Renewables are Rising
Solar and wind combined saw a new record-high share, 23% in May, according to the analysis for Carbon Brief, based on official figures.
This compares with just a 7% share back in May 2016.
"Falling generation from fossil fuels point to a 3.6% drop in CO2 emissions from the power sector, which accounts for around two-fifths of China's total greenhouse gas emissions and has been the dominant source of emissions growth in recent years," Myllyvirta noted in the analysis.
As solar and wind capacity installations continue to set record highs, China has a chance to slow the growth in power sector emissions and even put them in decline by the end of decade, analysts say.
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China continues to be the undisputed global leader in solar and wind capacity installations as it is currently constructing twice as much renewable power capacity as the rest of the world combined, think tank Global Energy Monitor (GEM) said in a report earlier this month.
As many as 180 GW of utility-scale solar and another 159 GW of wind power are currently under construction in China—enough capacity to power all of South Korea, the authors of the research noted.
China now accounts for nearly two-thirds of all solar and wind power capacity in construction in the world. The second-largest capacity fleet under construction is in the United States, but at 40 GW, it is dwarfed by China.
Over the last year, China installed more solar than it had in the previous three years combined and more than the rest of the world combined for 2023, GEM said.
Still, while China is the world's largest investor in wind and solar, it is also investing heavily in hydropower and hydrocarbons as it pursues an "all of the above" approach to energy supply.
By Tsvetana Paraskova for Oilprice.com
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