China's New Coal Power Installations Reach 18-Year High

China has been known to grow its coal power and renewables capacities in tandem for some years now. While the expectation for most observers was likely that green energy would eventually gain the upper hand after a transitional time period, 2025 figures released by the Global Coal Plant Tracker paint a different picture about the direction China’s electricity mix might be taking.

Last year, China installed almost 70 gigawatts of new coal power capacity more than it took off the grid. The last time this number has been this high was in 2007. In 2018, between 2020 and 2022 as well as in 2024, net coal additions had stayed below 30 gigawatts.

Blackouts that happened in 2021 and 2022 due to coal shortages, droughts and Covid demand fluctuations are cited as reasons China decided to once again invest in the technology which is seen as a very reliable power source - a decision that is now manifesting itself in finished coal power plants. Additionally, China has more projects in the pipeline. A staggering 500 gigawatts of coal power capacity are under construction, permitted, pre-permitted and announced in the country as of this January.

China’s energy price politics are another factor fostering shortages independent of capacity considerations. Because the market has not been subject to deregulation, energy prices are fixed and providers cannot increase them when their costs go up. This is de-incentivizing them from keeping up production in times when it runs into difficulties.

Despite growing coal capacity, the share of China’s electricity generated from the fossil fuel has fallen over the years, reaching a still high 58 percent in 2024. Hydroelectricity’s share stood at more than 13 percent in 2024, but has been decreasing due to the critical droughts plaguing the country. At the same time, renewables like wind and solar have been expanding fast, but have not yet reached a 20 percent share of electricity generated annually. To reach critical climate goals, China would have to keep up progress instead of slowing it down or even reversing it.