BNEF China Continues to Increase Installed Renewable Capacity

Published on September 2nd, 2013 | by Joshua S Hill


A Cleaner Future For China Lays Ahead

September 2nd, 2013 by  

Coal’s dominant share of China’s power capacity is set to be slowly eroded over the next twenty years, thanks primarily to the growth of the country’s renewable sector, in particular large hydro, which is set to account for more than half of new power plants before 2030. And while China’s power capacity is expected to more than double by 2030, estimations suggest it’s carbon emissions could be in decline by 2027.

These findings are part of a new report released by Bloomberg New Energy Finance (BNEF), entitled ‘The Future of China’s Power Sector: From centralised and coal powered to distributed and renewable?’

BNEF expect an additional 88 GW of new power plants annually from now until 2030, which would be the equivalent of building the United Kingdom’s total generating capacity once a year. Unsurprisingly, China is currently the world’s largest power generator (and subsequently, the world’s largest carbon emitter), and could end up installing 1,500 GW of new generating capacity over the next two decades, and investing more than $3.9 trillion in power sector assets. However, and happily, because of China’s focus on renewable energy, their total power sector emissions could start declining in 2027.

“China has started to change course towards a cleaner future,” said Jun Ying, country manager and head of research for China at Bloomberg New Energy Finance. “But despite significant progress in renewable energy deployment, coal looks set to remain dominant to 2030. More support for renewable energy, natural gas and energy efficiency will be needed if China wants to reduce its reliance on coal more quickly.”

Due in part to their reliance upon manufacturing, China has made large strides in the renewable energy sector, specifically in the solar and wind industry. This has led to an industry leading manufacturing infrastructure, supplying great swathes of the world’s photovoltaic and turbine products. Unsurprisingly, while economically beneficial to China, this industry leadership has also benefited the country’s power mix, especially in light of the need to minimise the horrific amounts of coal-based carbon emissions the country has been pumping into the atmosphere.

Bloomberg New Energy Finance analysed China’s power sector based on four separate scenarios — Traditional Territory, New Normal, Barrier Busting, and Barrier Busting with Carbon Price. The central scenario (New Normal) sees China’s total power generation capacity more than doubles by 2030. Together with an increase in renewables (featuring large hydro) enough to supply more than half of all new capacity additions, the scenario saw an increase in gas-based generation, which would drive the share of coal-fired power generation down from 67% in 2020 to 44% in 2030.

Even in the New Normal, however, coal’s production capacity is still set to grow rapidly until 2020, adding an average of 38 GW per year. Following 2020, coal will see smaller growth — only 10 GW per year — until 2030. Due to the longevity of China’s coal industry, the country’s carbon emissions and atmospheric problems causing poor air quality will continue through the next 10 to 15 years, and could take many more before any considerable beneficial effects are seen.

The remaining three categories are described as follows;

  • Traditional Territory — which sees a heavier reliance on coal and fossil fuels
  • Barrier Busting — in which barriers to the adoption of clean technologies are systematically eliminated by policy-makers
  • Barrier Busting with Carbon Price — which includes the above category and then includes a carbon price.

Commenting on the final scenario, BNEF noted that they belief themselves to be the first to produce “…the world’s first forecast of a Chinese carbon price, based on stated national goals for emission abatement.” Specifically;

An average carbon price of CNY 99/tCO2e ($16/tCO2e) will result in 23% fewer new coal plants being built compared to the New Normal scenario. The difference would be made up by more renewables and natural gas. The sector’s carbon peak would arrive four years sooner as a result, in 2023.

“The wide range of outcomes in our scenarios demonstrate the extreme uncertainty facing China’s energy sector,” said Milo Sjardin, head of Asia Pacific at Bloomberg New Energy Finance. “The future depends on a number of big questions, questions on which one can still only speculate: the cost at which China may be able to extract its shale gas reserves, the potential impact on fracking and thermal generation of water constraints; and potential accelerations in climate and environmental policy, including a potential price on carbon.”

“It is hard to underestimate the significance of China’s energy consumption growth and its evolving generation mix,” said Michael Liebreich, chief executive of Bloomberg New Energy Finance. “The impacts will reach far beyond China and have major implications for the rest of the world, ranging from coal and gas prices to the cost and market size for renewable energy technologies – not to mention the health of the planet’s environment.”

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About the Author

I'm a Christian, a nerd, a geek, and I believe that we're pretty quickly directing planet-Earth into hell in a handbasket! I also write for Fantasy Book Review (, and can be found writing articles for a variety of other sites. Check me out at for more.

  • ShaleGasExpert

    While the news from BNEF is welcome, it’s perhaps out of date. A report September 4 from Citi “The Unimaginable: Peak Coal in China” says the penetration of natural gas, renewables, new nuclear, efficiency and a switch from a less energy intensive economy to a services led one, all combined with the political imperative to reduce air pollution, will combine to achieve 1 Billion tons less of CO2, not in 2027, but by 2020.

    This isn’t unabashed good news for everyone of course, and Bloomberg NEF my be a case of someone more worried about their business model disappearing than CO2 reducing. Removing China’s1 billion tonnes, which isn’t too far off the entire coal capacity of most of the EU, highlights how inconsequential European efforts are. EU targets of 80% decarb, which were unlikely to be ever achieved by 2050, can now be replaced with more realistic targets of 50% by 2030. Let’s remember that 1 trillion tons of carbon is the maximum burn by 2040 according to the IPCC. Let’s use as little carbon as possible, as soon as possible. The logical choice is to pragmatically use gas instead of coal, instead of spinning coal out in the hope something else will come along that’s perfect, but currently unachievable economically, politically or physically. That describes the current state of play of nuclear, renewables, energy storage and CCS.
    What would appear to be achievable by 2040 are even more savings from substituting not only gas for coal, but gas for oil in marine, trucking railroad and mining internal combustion.

    • Bob_Wallace

      I don’t have any disagreement with you in terms of using gas in place of coal.

      If the gas industry stops (greatly minimizes) its leaks.

      But rather than looking for new places to use gas we should be looking for places we can go from petroleum to renewable electricity. Many of our trains already run on electricity, we generate that electricity on board with diesel generators. We could, as well, pull the electricity from overhead wires as much of the rest of the world does.

      Then, when we look at replacing a coal plant, first calculate how much of the capacity can be replaced with renewables. Add the wind, solar and geothermal that makes sense and then fill in with NG.

  • Jim Nelson

    “lays ahead”?
    “belief themselves”?
    “the world’s largest power generator (and subsequently, the world’s largest carbon emitter)”?

    Though you, dear Joshua, may belief yourself to be a competent writer in your mother tongue, more gentle mockery may lay ahead for you, as a subsequence of, let’s say, the limited editing applied to articles published in CleanTechnica.

    • Guest

      I imagine you meant to say “… believe yourself …”.

  • Kevin McGinnis

    China’s stride towards a cleaner future needs to happen if they don’t want to be known as the country with,by far, the worst air pollution.

  • Steeple

    Our Emissions here in the US are in decline. Meanwhile China’s are expected to peak in 2027? Maybe Fat Al should spend a little time preaching to the Chinese. Oh, that would require courage? I guess saving the world isn’t that important then, is it?

    • Bob_Wallace

      Do you get up in the morning thinking about how to be obnoxious during the coming day or does it come to you spontaneously?

      • Steeple

        We’re both trying to get to the truth, Bob.

    • JamesWimberley

      Chinese environmental protesters risk quite a lot more when they take to the streets of Kunming (or Ningbo or Dalian or Qidong or Guangzhou) than you do sneering at their efforts and Al Gore´s. ¨What did you do in the climate war, Grandpa?¨ Scribbling for the wrong side.

      • Steeple

        Don’t worry; we’re doing our part even if the Settled Science seems a bit wobbly.

        • Bob_Wallace

          The science is doing just fine.

  • JamesWimberley

    Is a growth path for coal of 38 GW a year politically sustainable in China? Air pollution is already a major headache for the oligarchy, which will do anything to stop it turning into a real threat to its survival. ¨Anything¨ here includes radical measures like halting growth in electricity consumption. Doubling wind and solar targets yet again will look like the easy option.

    Nuclear is irrelevant to the dilemma, simply because the plants take too long to build. There is no such thing as a nuclear crash programme.

    • JohnHartshorn

      “In China, now with 15 operating reactors on the mainland, the country is well
      into the next phase of its nuclear power program. Some 26 reactors are
      under construction and many more are likely to be so in 2012. Those
      under construction include the world’s first Westinghouse AP1000 units,
      and a demonstration high-temperature gas-cooled reactor plant is due to
      start construction. Many more units are planned, with construction due
      to start within three years. But most capacity under construction is the
      largely indigenous CPR-1000 design. China aims at least to quadruple
      its nuclear capacity from that operating and under construction by 2020.”

      • Bob_Wallace

        I would advise you bet nothing more than pocket change on that prediction.

        Since China put together its earlier nuclear plans the price of wind and solar generation has greatly fallen. It’s a brand new economic environment in which nuclear is getting shoved aside.

        The leaders of China do numbers very well. They know how to calculate both the cost per kWh and the amount of time needed to bring new generation on line.

        • JohnHartshorn

          And don’t overlook India either. The economics still seem to favor nuclear there as evidenced by this note affirming a start up date of September 2014 for the worlds’ first Thorium breeder reactor to be installed as part of a power grid. In time, the potential of Thorium will dwarf uranium as a nuclear fuel and India has an abundance.

          • Bob_Wallace

            Was wondering when the decision to build this reactor was made. Turns out 2004 was when construction started. That is, obviously, long before wind and solar became cheaper than new nuclear.

            “The Indira Gandhi Centre for Atomic Research(IGCAR) is responsible for the design of this reactor. As of 2007 the
            reactor was expected to begin functioning in 2010.[2]As of April 2011, it was expected to be commissioned in 2012. [3]As of July 2012, it was expected to begin operations in 2013.As of February 2013, it was expected to begin operations in September 2014.[4]Total costs, originally estimated at 3500 crore (35 billion) Rupees are now estimated at 5,677 crore (56 billion) Rs.”


            And while looking I ran across this bit that was news to me…

            “Some news agencies stated that in 2012, the Department of Atomic Energy for the first time admitted that the deaths of some employees and their dependents at the Kalpakkam nuclear site were caused by multiple myeloma, a rare form of bone marrow cancer linked to nuclear radiation.
            The DAE acknowledged that nine people, including three employees working at the Madras Atomic Power Station at Kalpakkam died of multiple myeloma and bone cancer between 1995 and 2011. This information came to light in response to a Right to Information (RTI) inquiry from October 2011. The DAE had previously stonewalled all previous requests for information.[5]BARC director R K Sinha dismissed press reports regarding cancer deaths around the Kalpakkam atomic power plant near Chennai caused by radiation as baseless.[6] ”


            It will be interesting to see how India decides to spend its money going forward.

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