Energy Transition Reality Check: Is Coal Here to Stay Longer Than We Thought?

Despite global efforts to transition to clean energy, China's coal power expansion in 2024 has reached record levels, casting doubt on the pace and effectiveness of the energy transition. China began construction on 94.5 gigawatts (GW) of new coal-fired power projects last year, the highest level since 2015. This surge in coal power development comes as a setback to climate goals and raises questions about the true nature of the global energy shift.

 

Key points from this development:

 

China approved 66.7 GW of new coal-fired power capacity in 2024, with approvals accelerating in the second half of the year.

 

The global coal fleet outside China shrank by 9.2 GW in 2024, highlighting China's dominant role in the coal power sector.

 

China now accounts for 93% of global coal power construction starts, further solidifying its position in the future of coal.

 

Despite President Xi Jinping's pledge to begin phasing down coal use from 2026, the rapid expansion of new coal projects reveals a gap between climate goals and energy actions.

 

Over 75% of newly approved coal power capacity in 2024 was backed by coal mining companies or energy groups with coal mining operations, artificially driving up coal demand.

 

This continued reliance on coal contradicts the narrative of a smooth and rapid energy transition. As global electricity demand rises sharply due to electrification, it is outpacing renewable energy supply and increasing reliance on coal. The coexistence of record solar generation and record coal demand underscores the uneven nature of the energy transition.

 

The persistence of coal in the energy mix, particularly in emerging markets, highlights the challenges in financing and implementing a just energy transition. While initiatives like the Coal-to-Clean Initiative are working to rally diverse financial players to fund the early retirement and repurposing of coal-fired power plants, progress remains slow.

 

As the world grapples with the reality of coal's enduring presence, it becomes clear that the energy transition is more complex and time-consuming than often portrayed. The myth of a swift and seamless shift to clean energy is being challenged by the stubborn persistence of coal in the global energy landscape.

 

Source: Centre for Research on Energy and Clean Air (CREA), Global Energy Monitor (GEM), and International Energy Agency (IEA) reports.