China is going to boost coal production and power generation despite plans to boost its wind and solar capacity as well, signaling hydrocarbons remain an essential source of reliable electricity.
In a report released today and quoted by Reuters, the Chinese authorities also said they were going to change the pricing mechanism for electricity generated by wind and solar installations. The report comes out after the news broke that subsidies for wind and solar are going to be reduced.
“China will actively and prudently work towards peaking carbon emissions and achieving carbon neutrality,” Reuters quoted the report as saying.
China is the undisputed leader in the transition space, investing the most in wind and solar, along with EVs, and having the greatest generation capacity of the alternative sources of energy. Last year, solar capacity alone surged by 45%. Together with wind and hydropower, total low-carbon generation capacity reached 40% of the country’s total, the Chinese authorities reported last month.
This meant that the country, which is the biggest emitter of carbon dioxide in the world, has hit its 2030 low-carbon generation target six years early and just four months after said target was set. By adding about 277 GW of solar capacity and another 80 GW of wind capacity in 2024, China beat its own record of annual renewable capacity additions.
Beijing’s central planner, the National Development and Reform Commission, also said last month it would reduce subsidies for wind and solar because costs had fallen considerably over the years and could now try and compete on the free market.
At the same time, coal continues to be a big feature of the country’s energy mix and about to become an even bigger feature of it. Chinese coal production is forecast to increase by about 1.5% this year from 2024, for the ninth straight annual rise, which is happening despite the push for less coal use and more wind and solar.
Source: By Irina Slav from Oilprice.com