Overseas renewable energy projects a growing focus under China’s Belt and Road Initiative: report

Renewable projects account for nearly 60 per cent of 80 gigawatts (GW) overseas power capacity expected to come online under the belt and road plan, according to a new analysis published by consultancy Wood Mackenzie on Monday.

Although coal and gas projects continue to account for a majority of the existing overseas power capacity, the share of renewables in the aggregate capacity has grown over the years, the report found.

“China is changing its overall strategy, so we expect to see more focus on renewables, and more direct investment than the bilateral lending that was more common in the early years of the Belt and Road Initiative,” said Alex Whitworth, vice-president and head of Asia-Pacific power and renewables research at Wood Mackenzie in the report.

The report comes on the heels of the 10th anniversary of the initiative, which was launched with the aim of improving regional integration and for increasing trade between Asia, Africa, and Europe. Since the launch, China has installed 128GW of power capacity, exceeding Australia’s total installed capacity, via more than 300 projects involving total investments of around US$200 billion, according to Wood Mackenzie.

The completed projects include 62 coal and 30 gas power projects, representing 57 per cent of the total belt and road project capacity, and another 37 per cent were contributed by 199 renewable projects, which include wind, solar, and hydro power units. The share of renewables in newly built capacity has also increased to 47 per cent in 2022 from 19 per cent 10 years ago, the report found.