China Coal Power Scenario
China has one of the fastest-growing power markets in Asia, but imbalanced regional development, with a population estimated at 1.38 billion people in 2015. China’s power sector is heavily dependent on coal-based power generation, which accounted for 59.7% of cumulative installed capacity in 2015. The key drivers for Chinese market transition from fossil fuels to non-fossil fuels include: Energy transformation, Emission reduction, Air quality, Water resources, Economic restructuring, and Energy consumption.
The annual installed coal capacity was 55.3 Gigawatts (GW) in 2015, and is expected to decrease to 32 GW by 2025 at a negative CAGR of 5.3%. In 2015, coal accounted for 94% of thermal power capacity. This high dependence on coal power arises from the availability of indigenous coal deposits, and China’s ability to quickly construct and commission coal-fired power plants. China’s coal power generation increased from 3,272.8 TWh in 2010 to 3,798.1 TWh in 2015 at a CAGR of 3.0%. It is expected that by the year end 2025, the total coal power generation is expected to decrease to 3,343.2 TWh at a negative CAGR of 1.3% during the period 2015-2025.
In 2015, Chinese provinces such as Jiangsu, Shandong and Shanxi were involved in providing new permits for coal-fired power plants, but at the beginning of 2016, the central government directed local authorities to postpone or cancel the construction of new coal-fired projects, as regulators seek to decrease a glut in capacity.The government is now stringently holding back the construction of new coal-fired power plants, including withdrawing some approvals already given in 2015. This would lead to decreased coal installations in the coming decade. The coal-fired power plants being commissioned will just add to the over capacity of the country, which is expected to fall starting from 2016.
It can be estimated that on restricting about 35 GW of coal-fired power capacity, which is in the approval phase, nearly 176.6 million metric tons of CO2 emissions can be saved annually.
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