Combining China’s Coal Consumption – Energy Research Institute Blog

You think Halloween is scary.

I was a little surprised by the optimism in the World Energy Outlook 2022 released this week by the International Energy Agency. IEA first forecast ‘Coal demand will peak in coming years’This weekend’s New York Times Magazine’s David Wallace-Wells shared a similarly optimistic view, arguing that the worst climate outcomes are now unlikely, largely because the world is moving away from coal.

I would like to believe this. However, it is difficult for me to reconcile this optimism with recent coal consumption data. Total global coal consumption will increase by 5% in 2021, and global coal power generation hit a record high last year.

This continued reliance on coal partly reflects China’s decades-long boom in building coal-fired power plants. More than half of coal-fired electricity generation came from China last year, so understanding the trajectory of China’s coal consumption is critical to global efforts to combat climate change.

For today’s post, I’d like to see data on coal power generation in China. How much coal power is produced in China? How has this changed over time? And, to put it in context, I want to compare it to the US, where the industry is going in a very different direction.

Trading places

The graph below depicts the annual electricity production from coal. Other sectors also use coal, but power generation is the most important.

In 2000, coal power generation in the United States was 2,000 terawatt-hours. This is the peak period of coal consumption in the United States, with less than 1 billion tons of coal used for power generation, equivalent to 3.5 tons of coal per person.

Since then, coal power generation in the United States has steadily declined, reaching 770 TWh by 2020. That’s still a lot of coal, but the overall pattern since 2000 is a significant decline that has been studied extensively (here, here, and here).

China power up

China has been moving in the opposite direction. China’s coal power generation has grown from under 1,000 TWh in 2000 to 4,775 TWh in 2020. I was struck by China’s rapid growth and the contrasting patterns of the two countries. By 2020, China will grow from 0.5 times that of the United States to 6 times that of the United States.

The biggest single factor explaining this different pattern is that electricity demand in China is soaring, while demand in the United States is almost flat.

To meet the huge increase in electricity demand, China has built more stuff. There is more wind, solar, hydro and nuclear power than any other country, and yes, far more coal.

This continued dominance of coal has many implications. For example, it got me thinking about the environmental impact of electric vehicles. From a climate change perspective, electric vehicles in the U.S. make more sense than they did a few years ago. But it’s harder to do in China, with a coal-dominated grid, even though the country leads the world in sales of new electric vehicles.

What’s next for China?

Predicting the future is always difficult. Nicholas Stern and co-authors predicted in 2016 that China’s coal use had peaked and that China’s economic growth had been “decoupled” from coal growth. Now with the benefit of a few years of data, it seems obvious that these predictions were wrong.

If anything, Chinese coal appears to be gaining momentum. While coal in the rest of the world is fading, China is adding tens of gigawatts of coal-fired power each year, the equivalent of one large coal-fired power plant every week. A recent report found that China has 247 GW of new coal plants under development.

On the other hand, a recent study by Energy Institute alumnus Amol Phadke and co-authors found that China has a significant opportunity to replace coal. In their analysis, massive investments in solar, wind and battery storage have created a lower-cost and lower-emissions Chinese power sector.

big ship

I’m not sure what’s going to happen, but I know it’s a big deal. One of the authors of a recent related study spoke about the inherent inertia of electricity markets, “China is like a big ship and it takes time to turn in the other direction.”

An important factor in this inertia is the coal-fired power plants themselves. The typical operating life of a coal-fired power plant is 35 years or more, so every time a coal-fired power plant is built, it can lock in CO2 emissions for decades to come.

It’s also a reminder to take any predictions with a grain of salt. Yes, we have reasons for optimism, and opportunities for decarbonization that simply did not exist a few years ago. But coal and other fossil fuels are still cheap, convenient, and used in abundance around the world.

Follow Energy Institute blogs, research and events on Twitter @energyathaas.

Suggested Citation: Davis, Lucas. “Putting China’s Coal Consumption in Context,” Energy Institute Blog, UC Berkeley, October 31, 2022

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