China boosts coal production capacity, setting back carbon-neutrality targets

China is promoting coal-fired power as the ruling Communist Party tries to revive a sluggish economy.

After economic growth plunged last year, shortages caused blackouts and factory shutdowns in several areas of the country. Moreover, Russia’s attack on Ukraine has added to anxiety that foreign oil and coal supplies might be disrupted.

Chinese officials plan a call for boosting coal production capacity by 300 million tonnes this year, according to news reports. That is equal to 7 per cent of last year’s output of 4.1 billion tonnes, an increase of 5.7 per cent over 2020.

“This mentality of ensuring energy security has become dominant, trumping carbon neutrality,” said Li Shuo, a senior global policy adviser for Greenpeace. “We are moving into a relatively unfavourable time period for climate action in China.”

China is the top producer and consumer of coal, producing more than 90 per cent of the 4.4 billion tons it burned last year, as well as one of the biggest investors in wind and solar, which gives the country a huge influence on global energy trends.

Currently, Chinese officials face political pressure to ensure stability as President Xi Jinping prepares to try to break with tradition and award himself a third five-year term as ruling party leader in the autumn.

Coal is important for “energy security”, Cabinet officials said at a meeting on April 20, which approved plans to expand production capacity, according to Caixin, a business news magazine.

The ruling party is also building power plants to inject money into the economy and revive growth that sank to 4 per cent over a year earlier in the final quarter of 2021, down from the full year’s 8.1 per cent expansion.

Meanwhile, governments around the world have pledged to try to limit warming of the atmosphere to 2°C above the level of pre-industrial times. Leaders say what they really want is a limit of 1.5°C.

Even if this goal is achieved, scientists have warned that some of the impacts of climate change can no longer be avoided, such as higher seas; stronger storms; extinctions of plants and animals, and more people dying from heat, smog and infectious diseases.

Currently, China accounts for 26.1 per cent of global emissions, more than double all developed economies combined, according to research company Rhodium Group.

The country’s Communist Party has rejected binding emissions commitments, citing its economic development needs. Beijing has avoided aligning itself with governments that promised to phase out use of coal-fired power.

In a 2020 speech to the United Nations, Xi said China is aiming for carbon neutrality, or removing as much from the atmosphere by planting trees and other tactics, by 2060. The country appears to be on track to achieve this goal, but using more coal “could jeopardise this, or at least slow it down and make it more costly”, said Clare Perry, of the Environmental Investigations Agency.

“This move runs entirely counter to the science,” she added.

China accounted for about half of global investment in wind and solar in 2020. Beijing has spent tens of billions of dollars on building solar and wind farms to reduce reliance on imported oil and gas and clean up its smog-choked cities.

Authorities say they are shrinking carbon emissions per unit of economic output. The government reported a reduction of 3.8 per cent last year, better than 2020′s 1 per cent but down from a 5.1 per cent cut in 2017.Nevertheless, output and consumption of coal are still rising. 

Coal is expected to supply 60 per cent of the country’s power in the near future. Last year, the country’s total energy use increased 5.2 per cent over 2020 after a revival of global demand for Chinese exports propelled a manufacturing boom, according to the National Bureau of Statistics.

China’s coal-fired power plants operate at about half their capacity on average, but building more creates jobs and economic activity, said Greenpeace’s Li. Even if the power is not needed now, local leaders might face pressure to make them pay for themselves.

“That locks China into a more high-carbon path,” he said. “It’s very difficult to fix.”