Russell: China's coal consumption and output is increasing, while renewable energy surges.
China's thermal energy generation grew in August, the first time it has done so in four months. However, it is still behind the overall increase in electricity production as renewables continue to grow.
According to data released by the government on September 14, electricity from thermal sources increased 3.7% from August of last year to 614,9 billion kilowatt hours (kWh).
Thermal power is almost exclusively coal-fired in China, with natural gas making up a very small percentage.
The increase in thermal production was lower than the 5.8% growth in total electricity output, which reached 907.4 billion kWh. This reflects the significant increase in clean energy.
The hydropower sector grew 10.7% from August 2023, reaching 163.5 billion kWh. However, the rate of growth slowed from July's 36.2% increase.
Solar output grew by 21.7% compared to a year ago, and wind increased by 6.6%. Nuclear generation rose 4.9% in August.
Two trends are evident in the August data on China's power generation.
First, renewables continue to take a larger share of the total electricity production.
Second, while coal's share of generation is declining, it is still the backbone of China's power system and will likely remain so for at least another ten years.
Wind and solar will meet a large part of the future demand for electricity.
Solar capacity installed in the first seven month of this year reached 124 gigawatts, an increase of 28 percent from the same period of 2023.
The installed wind capacity increased by 38 GW during the same period. This is a 6% increase from the first seven month of 2024.
In contrast, during the first seven-month period of 2024 a new thermal power generation capacity of 24 GW has been commissioned. Hydropower only saw a slight increase, and nuclear remained stable.
COAL HOLDS ON
The amount of electricity generated by coal continues to rise, and is likely to continue doing so.
China continues to build new coal-fired power plants at a rapid rate. According to the Global Energy Monitor, 173.5 GW are currently under construction. This is approximately 76% of global total.
China will continue to grow its coal generation in the coming years, despite retiring older coal-fired power plants.
The world's largest coal importer and producer is likely to mine more coal and purchase even more.
China's coal production increased 2.8% from a year ago to 396.55 millions metric tons, as the production ramped-up to meet an increase in electricity demand. This was in turn fueled by higher-than-usual temperatures in summer.
The demand for coal in industrial processes, such as cement or coal-tochemicals, is also on the rise.
The price of thermal coal has risen in China. The price of thermal coal at Qinhuangdao, a northern port.
The firm domestic prices kept seaborne imports affordable. According to data from commodity analysts Kpler, arrivals in August were 30,42 million tons, up from 28,55 million tons in July.
Kpler estimates that September seaborne thermal coal imports will also be robust. This figure is likely to increase as more cargoes arrive for assessment by the end the month.
These are the opinions of the columnist, an author for.
(source: Reuters)
