By Dean Baker
The New York Times ran a piece noting the huge increase in China’s use of solar power, but also highlighted concerns about its decision to build more coal-powered electricity plants. (The headline was “China Is Winning in Solar Power, but Its Coal Use Is Raising Alarm”) The piece talked about how John Kerry, President Biden’s special envoy for climate change, plans to raise the issue of coal with his Chinese counterpart at a meeting that starts Friday and that the issue is also likely to come up at a summit meeting with Biden and Xi next month.
While it is discouraging to see China continuing to build coal-powered plants, it is continuing to add wind and solar generation capacity at an incredibly fast pace. It is adding almost as much as the rest of the world combined, as this article notes.
The pace at which it adds capacity shows no evidence of slowing and may in fact accelerate if Xi decides to incorporate clean energy in a stimulus package. As a result of its rapid adoption of clean energy, its greenhouse gas emissions may peak next year, well ahead of its 2030 target. As it continues to add wind and solar capacity, its emissions will fall, especially in the context of its widely touted growth slowdown.
This raises the question of why it continues to build coal-powered plants. If China’s wind and solar capacity is growing more than its demand for electricity, this would imply less need for energy from coal-power plants, not more. And, once you have wind and solar capacity in place, it is far cheaper to get energy from these sources than from a coal-powered plant.
I can’t claim much knowledge of China’s politics, but I can see an analogous story in the United States. The Biden administration is pushing ahead with leasing large amounts of federal land for oil and gas development, even as it has put in place by far the most aggressive program for promoting clean energy the country has seen.
If the push for solar and wind energy is successful, there will be little demand for oil and gas from the land now being put up for lease. In that context, the leasing of land is an empty gesture to the oil and gas industry that will have little impact on future greenhouse gas emissions. (If it seems hard to imagine that major companies would put up tens of millions of dollars for leases that may never be used, consider that venture capitalists put up billions of dollars to finance We Work, a company whose great innovation was renting office space.)
If Xi faces comparable political considerations in China, it may make sense to allow politically connected interest groups to build coal-powered plants, even if there will be very little demand for their electricity once they are completed. Again, I have no way of knowing if Xi is making this sort of political calculation, but I do know that it is much cheaper to get electricity from wind and solar capacity that is already installed than from a coal-powered plant. Unless the plan is to subsidize the use of electricity from coal, most of these plants will never generate much electricity. From that standpoint, if China continues to aggressively add wind and solar capacity, we don’t really have to worry much about its construction of coal-powered plants.
This first appeared on Dean Baker’s Beat the Press blog.