by Peter Franklin
Tuesday, 22
June 2021
Spotted
07:00

Why is China pulling the plug on coal?

Even before the pandemic, Xi Jinping was moving away from the fossil fuel
by Peter Franklin
Credit: Getty

China burns a lot of coal. And for climate ‘sceptics’ in the West that’s been the perfect excuse for not doing anything to cut our own carbon emissions. What’s the point, they’ve often argued, when the Chinese are building a new coal-fired power station every fortnight?

The anti-greens were actually missing a trick. Because as well as building coal-fired power stations at home, China has also been financing their construction abroad — through its gargantuan Belt and Road Initiative (BRI). 

So, with that sort of fire power aimed at the climate, do we just give up and wait for the world to cook? 

No, because there’s reason for hope. For a start, Chinese carbon emissions per head have levelled-off in the last few years (and are still well below those of the US). And as for those overseas projects, something extraordinary is happening there too.

According to a briefing paper by Christoph Nedophil Wang of the Green BRI Centre in Beijing, many of the power stations that were being funded under the Belt and Road Initiative have been shelved or cancelled altogether:

Between 2014 and 2020, about USD160 billion of Chinese-backed coal-fired power plants were being planned or announced outside of China; yet, of those projects, more than USD65 billion have either been shelved, mothballed or cancelled, with many more projects seeing delays in construction…
- Christoph Nedophil Wang, Green BRI Centre

Even before the pandemic there appeared to be a turn against coal investments.

Doubts about the BRI itself may be part of the reason why. Another is mounting international pressure. For instance, the G7 countries recently agreed to stop bankrolling overseas coal projects. 

But perhaps the most important cause is summed up by the following chart (from Nedophil Wang’s paper). It shows the falling cost of solar power over the last decade. 

Credit: Green BRI Centre

It’s still falling, but the turning point was around the middle of the last decade when it became cost competitive with fossil fuel electricity. Strangely enough, this was also when China’s retreat from funding coal-fired power stations began. 

‘Climate diplomacy’ is important. Believe it or not, investors do notice when politicians sign up to targets on reducing emissions. 

However, long before the ink has dried on these international agreement — indeed, long before they’ve even been proposed — market forces can go to work. If clean energy can out-compete fossil fuels then it doesn’t matter so much if the Chinese government drags its feet or if the Americans throw a hissy fit and walk away from the negotiating table. 

It would be wonderful if countries and corporations always acted in the long-term interests of the common good. However, the best guarantee that they will is their own immediate bottom line. 

If it stops dirty coal, I don’t mind if dirty cash does the talking. 

Join the discussion


To join the discussion, get the free daily email and read more articles like this, sign up.

It's simple, quick and free.

Sign me up
Subscribe
Notify of
guest
15 Comments
Most Voted
Newest Oldest
Inline Feedbacks
View all comments
Mike Atkinson
Mike Atkinson
1 year ago

Let’s look at some facts.  In 2020, China brought 38.4 gigawatts of new coal-fired power into operation. This is three times as much as came into operation anywhere else.  India, Indonesia and many other developing nations also have extensive plans for new coal-fired power stations.
Beijing has 247 gigawatts of coal power in planning or development. That’s more than the entire American coal fleet and some six times Germany’s total coal capacity today. Chinese provinces last year approved 47 gigawatts of new coal-fired power projects.
In China’s current five-year plan, the total of all non-fossil fuel power, including all the renewables plus its sizeable nuclear sector, will grow to just 20 per cent of the national power total. The Wall Street Journal reported last week that China’s main economic planning agency, the National Development and Reform Commission, had limited the scope of the ever elusive national carbon trading system, which has still not gone into operation, though we have been hearing about it for years and years as though it were an established and fully operating system.
Most of the Western media so desperately wants the dominant climate narrative,  (especially the bit where the West is the villain) to be true that they simply do not interrogate the facts. Recently the pro-renewables REN21 policy network reported that the share of fossil fuels in the global energy mix is about the same today as it was a decade ago.
How can this possibly be so if the whole world has been moving on climate change, as we are so often told?  Most movement that has occurred is simply that heavy industry has been transferred from rich nations to developing nations where it takes place under more lax environmental regulation and thereby produces more greenhouse emissions. Try making steel and cement using only wind/solar power.

Brendan O'Leary
Brendan O'Leary
1 year ago
Reply to  Mike Atkinson

Yes, but simply outsourcing heavy industry to a more populous country lowers “per capita” emissions of the two countries combined so it’s win/win!

Mike Atkinson
Mike Atkinson
1 year ago

Well, if we ‘export’ CO2 producing industry to China, our CO2/capita drops, while China’s goes up. It’s not win/win, but in the bizarre politics of the day, what’s not to like for us. Except of course, we become reliant on China for the goods the CO2 producing industry provides.

Jacob Mason
Jacob Mason
1 year ago
Reply to  Mike Atkinson

Great info. Thank you for sharing!

Stephanie Surface
Stephanie Surface
1 year ago

After the “do we have to wait for the world to cook”, I pretty much lost interest in the article. What a bunch of unscientific BS.

Brendan O'Leary
Brendan O'Leary
1 year ago

How is “per capita” even remotely relevant?
I certainly agree with you that we should let free market forces go to work instead of constant government interference in favour of wind and solar.
And let’s be honest: when we talk about renewables we mean wind and solar.

Russell Hamilton
Russell Hamilton
1 year ago

I’m all in favor of government interference and want it fast. Before the Chinese decide to stop buying our (Western Australian) iron ore (like they’ve stopped buying our barley, wine, lobsters etc.) we should set out vast fields of solar panels, use the power to split water, use the hydrogen to fire up the furnaces and produce ‘green steel’. No more selling iron ore. Oh and Sanford, all our excess solar power will go into giant Tesla batteries (south Australia has one) so we in effect have base load power.

Andrew Roman
Andrew Roman
1 year ago

Per capita is treated as relevant in the nationally determined contributions to the Paris Agreement. Several countries, including China and India, which refused even to promise reductions in CO2 emissions, instead promised reductions in emissions per capita. These promises were applauded by the UN and the international media as if they were emissions reductions when they were actually promised increases.

Jon Redman
Jon Redman
1 year ago

I love the way you wrote “climate ‘sceptics'”.

Stephanie Surface
Stephanie Surface
1 year ago
Reply to  Jon Redman

Noticed that too. People, especially journalists, are more and more changing their language into Green Speak. Nobody is a “Climate Sceptic”, whatever that may mean, and nearly everybody with a brain acknowledges, that there is something like “Climate” and of course natural occurring “Climate Changes”. Please UnHerd don’t have your authors fall into the same Green Speak trap. The so-called “Climate Sceptics” are not convinced that the human race is THE major contributor to “Climate Change”

Prashant Kotak
Prashant Kotak
1 year ago

I think the reasons are simpler: China, having poisoned it’s population once on the back of very rapid Industrialization, is learning fast and is unlikely to make the same mistakes in the future.

Galeti Tavas
Galeti Tavas
1 year ago
Reply to  Prashant Kotak

“. Because as well as building coal-fired power stations at home, China has also been financing their construction abroad — through its gargantuan Belt and Road Initiative (BRI).
2021 is not 2019, and funding third world coal plants, or even building excess capacity in China is not what it was wile the world was not encumbered in additional $50,000,000,000 Fiscal and Monetary MMT ‘covid response’ debt and HUGE deficite spending in the WEST.

The rules are changed. China has used building excess capacity as a way of stimulus for years, that no longer makes sense, The Chinese way of building in third world to intentionally bankrupt them so they may claim native resources for China may not be a workable plan now, post covid, as it was before.

And also – the writer neglects to even mention ‘Base Line’ power, which most renewables do not provide, but coal does.

Prashant Kotak
Prashant Kotak
1 year ago
Reply to  Galeti Tavas

Hey Sanford, good to see you back BTL!

Galeti Tavas
Galeti Tavas
1 year ago
Reply to  Prashant Kotak

Always good to see your posts Prashant

Anton van der Merwe
Anton van der Merwe
1 year ago

Sadly the falling costs of solar power obscure the fact that adding intermittent power sources such as solar and wind to the electricity grid has other costs that are far higher than the cost of installing. This is most evident in the rise in the cost of electricity as soon as intermittent renewables are added above a small fraction. These costs include the costs of stabilising the grid, the cost of storage for different intervals, and the costs keep dispatchable power sources available for use at all times. Then there are the costs of dealing with interruptions in supply. Importantly these costs increase exponentially at the level of intermittent renewables increases.