Wind and solar eclipse coal capacity in China

For the first time ever, wind and solar energy in China have, as of June this year, collectively eclipsed coal in capacity, according to the latest data from the country’s National Energy Administration (NEA), reports Rystad Energy. Furthermore, Rystad forecasts that by 2026, solar power alone will surpass coal as China’s primary energy source, with a cumulative capacity exceeding 1.38 TW – 150 GW more than coal.

China’s pivot towards renewable energy is fuelled by an increasing focus on reducing reliance on fossil fuels. Prior to 2016, coal dominated with around 50 GW of annual installations, according to Rystad. However, from 2020 onwards, wind and solar installations have consistently surpassed 100 GW annually, tripling or even quadrupling coal additions. Last year, China achieved a record 293 GW of wind and solar installations, driven by large-scale projects connected to the national grid through NEA’s initiatives.

Conversely, the analysis shows China’s coal power sector is contracting. In 2023, approximately 40 GW of coal power was added, but this figure dropped to 8 GW in 1H2024. This decline is a result of stringent government restrictions on new coal projects aimed at meeting carbon reduction goals. Efforts are now concentrated on phasing out smaller coal plants, upgrading existing ones to reduce emissions and imposing stricter standards on new projects. The gap between coal and renewable energy capacity additions widened dramatically, with a 16-fold difference in favour of clean energy in early 2024.

‘We’re at a pivotal moment for both China and the global energy transition,’ says Simeng Deng, Senior Analyst, Rystad Energy. ‘With strong renewable energy project pipelines in place, the country is on track to shed its reputation as the world’s largest greenhouse gas emitter and power consumer. Solar energy will be central to this transformation, with advancements in supply chains, infrastructure and capacity additions set to surpass coal in future energy production. This shift could be a landmark achievement, potentially transforming China from a coal-dependent giant into a leader in clean energy.’

China installed a record 71 GW of new wind capacity in 2020, driven by the urgency to secure feed-in tariffs and subsidies before they were phased out by the government. The rise was followed by an immediate fall, with installations then dipping for the next two years. However, wind capacity rebounded last year with 75 GW of new additions, fuelled by accelerated project development to meet national targets for 2025. In the first half of this year alone, 25 GW of new capacity has been added, with Rystad predicting an additional 50 GW in the second half of the year.

Meanwhile, China installed a record 216 GW of new solar photovoltaic (PV) capacity in 2023, driven by accelerated development in large-scale projects and rooftop PV initiatives. With 105 GW added in the first half of this year, China is expected to exceed 230 GW in total new solar capacity for 2024, forecasts Rystad Energy.

However, the market analyst warns that as China’s clean power capacity grows, it faces significant challenges such as low utilisation and intermittency. Addressing these issues requires substantial upgrades to grid infrastructure to enhance transmission flexibility and storage capabilities. Battery storage will also be crucial for maintaining grid reliability, ensuring that stability is preserved as clean energy expands to meet the needs of a growing population and broader national targets, Rystad says.  

Wind and solar overtake EU fossil fuel power  

A transformative shift is also taking place in the EU, with new analysis from think tank Ember revealing that wind and solar generated more electricity than fossil fuels during the first six months of 2024 for the first time ever in a half-year period. Wind and solar accounted for an all-time high of 30% of the EU’s electricity, compared to 27% from fossil fuels, which fell by 17%.

Despite an 0.7% increase in electricity demand as the region recovered from the impacts of COVID-19 and the gas price crisis, fossil fuel use has dropped significantly. Coal power saw a nearly 24% decrease, while gas fell by 14%. The primary driver for this reduction was the growth in renewable energy, particularly wind and solar, which outpaced the rebound in demand.

‘With wind and solar on the rise, the role of fossil fuel power is narrowing,’ notes Ember analyst Dr Chris Rosslowe. ‘We are witnessing a historic shift in the power sector, and it is happening rapidly.’

Ember’s analysis suggests that renewables growth goes beyond seasonal trends. It found that mild weather and good hydro performance also contributed to the large fall in fossil generation, but that wind and solar growth was the largest single factor.

This reflects a longer term shift, following record-breaking capacity additions for both wind and solar in 2023. In response to Russia’s invasion of Ukraine, the EU and many member states have introduced accelerated policies to reduce reliance on gas imports and boost wind and solar. A continued focus on this from the EU is now anticipated following Ursula von der Leyen’s recent re-election as President of the European Commission.

‘If member states can keep momentum up on wind and solar deployment, then freedom from fossil power reliance will truly start to come into view,’ continues Rosslowe.

The rapid growth of wind and solar was visible across EU countries in the first half of the year. A total of 13 member states now generate more electricity from wind and solar than from fossil fuels, with Germany, Belgium, Hungary and the Netherlands hitting that milestone for the first time.

In May, over 50% of Spain’s electricity generation came from wind and solar, the first time this has ever happened. In the same month, Poland hit a third of generation coming from wind and solar. Hungary set consecutive monthly records for solar generation in April, May, and June 2024.

New UK renewable power generation records

Meanwhile, new statistics published by the UK government confirm that renewable energy generated a record annual percentage of the UK’s electricity in 2023, outstripping fossil fuels for the third time in four years. Onshore and offshore wind, and solar, set new records for electricity generation.

Renewables provided 46.4% of the UK’s electricity last year (135.8 TWh), up from 41.5% in 2022, compared to 36.7% from fossil fuels (107.3 TWh, mainly gas at 101.7 TWh).

According to the Department for Energy Security and Net Zero (DESNZ) report, the rise is due to increases in wind and solar generation capacity, which offset slightly less favourable weather conditions. The annual report also notes that the share of generation from low-carbon sources rose to a record 60.3% in 2023, as stable renewable generation combined with lower overall generation.

Wind remains the UK’s biggest source of clean power, generating a record 28.1% of the country’ s electricity in 2023 (a record 82.3 TWh).  

Solar generated 13.9TWh (4.7%) in 2023, compared to 13.3TWh (4.1%) the previous year.  

Commenting on the statistics, RenewableUK CEO Dan McGrail says: ‘As these record-breaking figures show, renewables are now the backbone of the UK’s electricity system, keeping the country powered up as we transition away from expensive fossil fuels towards cheap electricity and our net zero goals. The less gas we use, the more protection billpayers have against volatile gas prices, so every clean energy project takes us a step closer to energy independence and real security.’