Why is China building new coal-fired power plants despite its green energy goals?

China’s rapid economic growth and energy needs have created a paradox: while the country is a leader in renewable energy investment, it continues to build new coal-fired power plants. Why is this happening, and what are the global implications?

New Coal Plants: Expansion vs. Sustainability

China has approved more than 100 GW of new coal-fired capacity by 2023, more than the rest of the world combined. These plants, mostly located in industrial hubs such as Inner Mongolia, Shanxi, and Guangdong, are aimed at stabilizing the grid as energy consumption grows.

Government Strategy: Energy Security Over Emissions?

The Chinese government argues that coal is a “backup” for renewable energy sources, ensuring electricity reliability. But critics warn that expanding coal production runs counter to China’s goal of carbon neutrality by 2060 and could slow the transition to clean energy.

Global impact: A setback for climate goals

As the world’s largest carbon emitter, China’s coal expansion has raised concerns about global climate commitments. The UN and environmental groups have warned that continued reliance on coal could hamper efforts to limit global warming to 1.5°C.

Urban challenges: Smog and health risks

Cities such as Beijing and Shanghai already struggle with air pollution. More coal-fired power plants could worsen respiratory diseases and worsen the environment, despite efforts to cut emissions with advanced filtration technology.

Financial costs: Is coal still cheap?

Coal investment remains high, with costs ranging from $1 billion to $2 billion per plant. However, solar and wind prices have fallen significantly, making coal less economically competitive in the long term.

Business vs. Environmentalists: A Divided Debate

The industry supports coal as a sustainable energy source for manufacturing, but environmentalists argue that favoring renewables will create long-term economic and environmental benefits. Many are pushing for a faster transition to battery storage and grid modernization.

A Critical Crossroads

China’s energy policy balances economic growth, energy security, and climate commitments. Whether the country accelerates its transition to renewables or remains reliant on coal will determine the global energy future.