Built to peak: Coal power expansion runs out of room in China

This report by Global Energy Monitor and the Centre for Research on Energy and Clean Air (CREA) analyzes the state of coal power expansion in China as of February 2026. It highlights a critical divergence where coal capacity reached a decade-high in 2025 despite falling generation and the rapid growth of clean energy and storage. The authors argue that current investment incentives and a large project pipeline risk locking in overcapacity and hindering China's 2030 climate targets, urging a fundamental shift in coal's role from baseload power to a flexible, residual support resource during the 15th Five-Year Plan.

• In 2025, China's coal power capacity additions reached their highest level in ten years, with 78 GW newly commissioned. This surge occurred despite a 1% year-on-year decline in coal power output and the fact that wind and solar absorbed 94% of net growth in power demand during the same year.
• There is a record-high surge in proposals for new and reactivated coal power projects, totaling 161 GW in 2025. This is attributed to industry stakeholders rushing to advance projects before the 15th Five-Year Plan (FYP) and 2030 carbon-peaking targets introduce tighter constraints.
• China's coal power pipeline remains extensive, with 291 GW of projects under construction or permitted, representing 23% of current operational capacity. This pipeline, combined with 83 GW starting construction in 2025, risks extending rapid capacity growth into the early years of the 15th FYP.
• New coal capacity is dominated by ultra-large units of 1 GW or more, with 52 such units entering operation in 2025. These units are designed for high-utilization baseload operation and are poorly suited for the flexible, load-following roles required in a system with high renewable penetration.
• Financial incentives for coal power are misaligned with system needs, as revenues remain heavily dependent on electricity output rather than flexibility services. Capacity-related revenue accounted for only about 5% of total coal power income in 2024, and even after 2026 reforms, it is expected to reach only around 8%.
• Coal power retirements are not keeping pace with new additions. While the National Energy Administration's 30 GW target for the 14th FYP may be met, many units are managed under 'retire but not dismantle' arrangements, remaining as emergency backup rather than being permanently removed.
• To meet its 2030 Nationally Determined Contribution (NDC) target of reducing carbon intensity by more than 65% from 2005 levels, China must shift coal power away from baseload operation. If coal generation remains flat, expanding capacity to 1,558 GW would drop average utilization to approximately 42% (3,695 hours per year), down from the previous decade's average of 51% (4,500 hours).

APA

Qin, Q., Shearer, C., & Schaepe, B. (2026). Built to peak: Coal power expansion runs out of room in China. Global Energy Monitor. https://globalenergymonitor.org/sites/default/files/migration/reports/CREA_GEM_China_Coal-power_H2-2025_3.pdf

Chicago

Qin, Qi, Christine Shearer, and Belinda Schaepe. Built to peak: Coal power expansion runs out of room in China. Global Energy Monitor, 2026. https://globalenergymonitor.org/sites/default/files/migration/reports/CREA_GEM_China_Coal-power_H2-2025_3.pdf.

Wikipedia

{{cite report |last1=Qin |first1=Qi |last2=Shearer |first2=Christine |last3=Schaepe |first3=Belinda |title=Built to peak: Coal power expansion runs out of room in China |publisher=Global Energy Monitor |date=February 2026 |url=https://globalenergymonitor.org/sites/default/files/migration/reports/CREA_GEM_China_Coal-power_H2-2025_3.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{qin2026built, author = {Qin, Qi and Shearer, Christine and Schaepe, Belinda}, title = {{Built to peak: Coal power expansion runs out of room in China}}, institution = {Global Energy Monitor}, year = {2026}, month = feb, url = {https://globalenergymonitor.org/sites/default/files/migration/reports/CREA_GEM_China_Coal-power_H2-2025_3.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }