Coal-rich, gas-poor China needs more carbon capture and energy storage tech for new power system, analysts say
- China announced last year that it would build a new type of power system featuring a gradual increase in the contribution of renewable energy sources
- To ensure power security under the new system, China must develop more energy storage technologies to keep intermittent wind and solar power supply more stable, analyst says
“Coal power plants can be kept while making room for wind and solar power by reducing their utilisation rates. With the proportion of wind and solar power becoming larger, the utilisation rates of coal power plants can be lowered,” Lin said.
China, the world’s largest greenhouse gases emitter and coal consumer, announced last year that it would build a new type of power system featuring a gradual increase in the contribution of renewable energy sources such as solar and wind. The new system will help it reduce its reliance on coal and support the country’s goal to meet carbon neutrality by 2060.
However, the country continues to lead the world in setting up coal power plants, driven especially by Beijing’s determination to ensure power security following a crisis last year due to coal shortages. In April, Chinese Premier Li Keqiang called for boosting coal production by 300 million tonnes this year, equal to 7 per cent of last year’s output of 4.1 billion tonnes.
“New coal power plants would mean a negative shift in the carbon emissions trajectory of the power sector in upcoming years, or would require carbon capture, utilisation and storage (CCUS), whose prospects are still highly uncertain,” said a report on China’s power system development published last week by the Helsinki-based Centre for Research on Energy and Clean Air (CREA) and Beijing-based Draworld Environment Research Centre.
China’s continuing buildout of new coal power plants goes against the country’s road map towards meeting climate targets and economic rationality, the report said.
Analysts, however, said that China lacked the infrastructure and availability of natural gas capacity in the short term, and has to rely on coal to ensure power security during its green power transition.
“In the next few years, there is almost zero chance that they can build up gas infrastructure and have more gas available for the power sector,” said Lucas Zhang Liutong, director of Hong Kong-based consultancy WaterRock Energy Economics.
China is the world’s largest natural gas importer due to its “rich in coal, poor in oil and short of gas” situation, and its total natural gas imports increased by 19.9 per cent year on year in 2021, according to S&P Global.
Given the current high gas prices – driven up by the conflict in Ukraine and limited gas availability in Asia – developing gas-fired power capacity is not economical in the short term, and that is one of the main reasons why the central and provincial governments have relaxed their policies related to new coal capacity, Zhang said.
To ensure power security under the new system, China must develop more energy storage technologies to keep intermittent wind and solar power supply more stable. The other way is to use CCUS technologies on coal power plants to reduce carbon emissions on-site, said WaterRock’s Zhang.
“China has also been pushing to incentivise investment of demand-response and energy-storage solutions. Both central and provincial governments have released several policies on those two in the past one or two years, but more needs to be done,” he added.