Column: Electric dreams turn into a nightmare for battery metals
A sector that was once racing to build new supply has been closing mines and deferring projects as low prices bite into the cost curve.
China put 38.4 gigawatts (GW) of new coal-fired power capacity into operation in 2020, according to new international research, more than three times the amount built elsewhere around the world and potentially undermining its short-term climate goals.
The country won praise last year after President Xi Jinping pledged to make the country “carbon neutral” by 2060. But regulators have since come under fire for failing to properly control the coal power sector, a major source of climate-warming greenhouse gas.
Including decommissions, China’s coal-fired fleet capacity rose by a net 29.8 GW in 2020, even as the rest of the world made cuts of 17.2 GW, according to research released on Wednesday by Global Energy Monitor (GEM), a U.S. think tank, and the Helsinki-based Centre for Research on Energy and Clean Air (CREA).
China has been criticised for pursuing an energy-intensive post-covid recovery based on heavy industry and construction
“The runaway expansion of coal-fired power is driven by electricity companies’ and local governments’ interest in maximising investment spending, more than a real need for new capacity,” said Lauri Myllyvirta, CREA lead analyst.
The country’s National Energy Administration (NEA) didn’t immediately respond to Reuters’ request for comment.
China approved the construction of a further 36.9 GW of coal-fired capacity last year, three times more than a year earlier, bringing the total under construction to 88.1 GW. It now has 247 GW of coal power under development, enough to supply the whole of Germany.
A team of central government environmental inspectors delivered a scathing assessment of China’s energy regulator last Friday, accusing officials of planning failures and focusing too much on guaranteeing energy supply.
The NEA had allowed plants to be built in already polluted regions, while projects in less sensitive “coal-power bases” had not gone ahead, they said.
China has been criticised for pursuing an energy-intensive post-covid recovery based on heavy industry and construction, and experts say new coal plants could end up becoming heavily-indebted “stranded assets”.
Christine Shearer, GEM’s coal programme director, said China needs to ensure its short-term development plans align with long-term climate goals.
“Hopefully as the Chinese government determines its coal power capacity targets for the next five-year plan (for 2021-2025), it will severely restrict if not end new coal plant builds and accelerate retirements,” she said.
(By David Stanway and Muyu Xu; Editing by Kenneth Maxwell)
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