The pace of China’s overseas coal project cancellations has slowed in the past year.
In September 2021, Chinese President Xi Jinping pledged at the United Nations General Assembly to halt the construction of new coal-fired power plants abroad. However, according to a recent report by the Centre for Research on Energy and Clean Air (CREA), progress in 2024 has been slower compared to previous years. Between 2023 and 2024, China cancelled only 5.6 GW of coal capacity, down from 15.9 GW in the previous year.
Since the pledge, Chinese companies and banks have cancelled a total of 42.8 GW of coal projects, avoiding 4.5 billion tonnes of cumulative carbon emissions.
However, as projects initiated before the pledge, 52 China-backed coal plants remain in the permitted, pre-permit, or construction phases. The capacity of operational coal plants has also increased over the past year, reaching 26.2 GW, up from 18.3 GW in 2023 and 9.2 GW in 2022.
The report also raises concerns about the continued expansion of “captive power” projects, which are designed to supply energy to specific industrial facilities rather than for grid consumption. It noted that in the past year, 3.4 GW of previously unannounced captive power capacity has entered the construction phase, mainly supporting mining and metals industries relevant to the green energy transition in Belt and Road Initiative (BRI) countries.
The future of projects where Chinese investments have been withdrawn also warrants attention. Coal power plant projects in Vietnam and Turkey have been terminated by their respective governments after being dropped by Chinese investors. However, in Cambodia, the government has been looking instead to turn coal-power projects such as Botum Sakor power station into natural-gas-fired plants. This raises concerns that without sufficient support for their energy transitions, some BRI countries may still pursue power projects that hinder emission reduction efforts.
Read Dialogue Earth’s previous analysis of how China can support Southeast Asia’s energy transition.