Coal is losing ground but not letting go: Structural inertia and the struggle to shift coal’s role in China’s power system

The report argues that while coal's share of power generation in China has reached historic lows, institutional inertia—including capacity payments, inflexible dispatch rules, and a lack of a national retirement strategy—continues to drive high levels of new coal capacity additions. It highlights a disconnect where clean energy is growing rapidly but is often offset by the continued expansion and protection of coal assets, which are not fulfilling their intended role as flexible backups for renewables.

• Coal power capacity additions remain high, with 21 GW commissioned in the first half of 2025, the highest for any first-half period since 2016. Full-year additions for 2025 are projected to exceed 80 GW.
• There is a significant surge in early-stage coal project activity, with new and revived proposals totaling 75 GW in the first half of 2025, the highest such figure in a decade. This suggests developers are rushing to secure approvals before the 2030 carbon peaking deadline.
• Clean energy is expanding rapidly, with wind and solar additions expected to exceed 500 GW in 2025. Consequently, coal's share of power generation fell to a record low of 51% in June 2025, while renewables now account for 60% of total installed capacity.
• Coal power is failing to act as a flexible backup for renewables because dispatch practices and capacity payments prioritize upward ramping and baseload operation over scaling down during periods of high renewable supply.
• China lacks a coherent national strategy for coal retirement, and actual retirements are far below targets. Only 1 GW of coal power was retired in the first half of 2025, and only 16 GW have been retired since 2021, making the 14th Five-Year Plan goal of 30 GW by the end of 2025 unlikely.
• Institutional mechanisms, such as long-term contracts and administrative dispatch, structurally protect coal power, often forcing renewable energy plans to be adjusted when they conflict with coal's minimum operating levels.

APA

Qin, Q., & Shearer, C. (2025). Coal is losing ground but not letting go: Structural inertia and the struggle to shift coal’s role in China’s power system. Global Energy Monitor. https://globalenergymonitor.org/sites/default/files/migration/reports/CREA_GEM_China_Coal-power_H1-2025_3.pdf

Chicago

Qin, Qi, and Christine Shearer. Coal is losing ground but not letting go: Structural inertia and the struggle to shift coal’s role in China’s power system. Global Energy Monitor, 2025. https://globalenergymonitor.org/sites/default/files/migration/reports/CREA_GEM_China_Coal-power_H1-2025_3.pdf.

Wikipedia

{{cite report |last1=Qin |first1=Qi |last2=Shearer |first2=Christine |title=Coal is losing ground but not letting go: Structural inertia and the struggle to shift coal’s role in China’s power system |publisher=Global Energy Monitor |date=25 August 2025 |url=https://globalenergymonitor.org/sites/default/files/migration/reports/CREA_GEM_China_Coal-power_H1-2025_3.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{qin2025coal, author = {Qin, Qi and Shearer, Christine}, title = {{Coal is losing ground but not letting go: Structural inertia and the struggle to shift coal’s role in China’s power system}}, institution = {Global Energy Monitor}, year = {2025}, month = aug, url = {https://globalenergymonitor.org/sites/default/files/migration/reports/CREA_GEM_China_Coal-power_H1-2025_3.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }