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More China-backed coal-fired power plants worldwide canceled than commissioned

More China-linked coal-fired electricity capacity has been shelved or canceled over the past five years, according to a new report.

The Center for Energy and Clean Air Research (CREA) said this finding indicates that, despite massive domestic construction, China’s overseas coal projects in most host countries face significant political and financial challenges.

More than 120 GW of coal-fired capacity currently operating can be linked to China. Between 2000 and 2017, Chinese companies invested about $115 billion (£82 billion) in overseas power plants, the report found.

Since 2017, a spate of project cancellations has hit China-backed investment in coal energy – 4.5 times more capacity has been shelved or canceled than has been built. In 2018, a study found that two-fifths of the world’s coal-fired power plants were already operating at a loss.

In addition to the damaging impact on the environment and high CO2 emissions, the price of renewable energy has fallen dramatically in recent years, making new coal plants seem less efficient by comparison.

Indeed, the CREA report specifically cited the “weakening of coal’s economic competitiveness” as one of the factors behind project suspensions. Public opposition and concerns about negative environmental and social impacts, as well as existing overcapacity in recipient countries, were also to blame.

Overseas coal projects with Chinese involvement have much higher air-polluting emissions than allowed for coal-fired power plants in China, the report said, with stated emission limits averaging six, four and seven times higher than the NOx, PM and SO2 emission limits in China, respectively. the Chinese regulations.

Moreover, in terms of CO2 emission intensity, only three out of 16 projects were found to meet China’s domestic thermal efficiency standards. On average, the projects had an 8 percent lower thermal efficiency than the minimum under China’s thermal efficiency standards.

CREA speculates that recent policy signals from recipient countries may have made Chinese banks and suppliers more cautious about taking on new projects, although it does not yet have the data to substantiate this assumption.

In May, the Industrial and Commercial Bank of China, the world’s largest bank by assets and a major source of global coal financing, said it was drafting a “roadmap” to exit the coal sector.