Significant investments in clean energy and favourable renewable energy prices continue to stifle the demand for coal in China. The world’s largest carbon emitter’s coal consumption fell in 2016 for the third consecutive year. The National Bureau of Statistics said the country’s consumption of coal fell by 4.7 per cent last year, according to preliminary calculations. According to the Bureau, the share of coal in China’s total energy consumption mix fell to 62 per cent in 2016 from 64 per cent in 2015.
Xu Zhaoyuan, Head of research division at the industrial economy department of the Development Research Centre of China’s State Council, reportedly said investments in energy intensive industries such as cement and steel production had been falling while clean energy was undergoing a boom. China has aimed to reduce coal usage in favour of renewable energy, including solar and wind power to combat the severe air pollution in its major cities. In 2016, China’s solar capacity grew an impressive 81.6 per cent to 77.4 gigawatts (GW) up from 34.5 GW at the end of 2015, while wind power grew 13.2 per cent to 149 GW. The combination of renewable energy growth and a new, slower economic growth model have left experts optimistic that coal use will not return previous levels, and many hope that a global peak in carbon emissions is now possible. Xu said: “I don’t think coal consumption is going to rebound in the next several years, but will rather plateau, meaning it will remain stable or decrease slowly.” In January 2016, China’s energy regulator has ordered 11 provinces to stop more than 100 coal-fired power projects, with a combined installed capacity of more than 100 GW, its latest dramatic step to curb the use of fossil fuels in the world’s top energy market. China’s State Council five-year plan – from 2016 to 2020 – aims to cut energy consumption by 15 per cent by 2020, compared to 2015 levels, while the country’s energy agency plans to invest 2.5 trillion yuan ($361 billion) into renewable power generation by 2020. Li Shuo, Greenpeace Global Policy Advisor, said, “China is ploughing money into renewables and reining in its addiction to coal. As Trump’s rhetoric leaves the world in doubt over what his plan is to tackle climate change, China is being thrust into a leadership role”. “These trends give some hope that the global peak in emissions might well be within reach, but only if all major emitters break free from fossil fuels and reduce emissions,” added Li.