China Stops Construction on 17 GW of Coal Capacity

In yet another sign of China’s overcapacity problem, especially in its coal sector, the central government has reportedly ordered a halt to construction on at least 30 coal-fired plants totaling 17 GW of capacity.

A continuing slowdown in China’s economy has thrown its power-sector planning into chaos, as estimates of future demand growth made in the early 2010s have proven wildly optimistic. The government has been frantically working to slow further expansion of its generating capacity throughout 2016 with increasingly drastic moves.

In April, the nation’s National Development and Reform Commission and National Energy Administration suspended or slowed plans for more than 100 GW of coal-fired capacity across the country and sped up planned retirements of older plants.

In July, reports emerged that the 13th Five-Year Plan would extend a ban on new coal plant construction nationwide at least through 2018, though it would allow many projects already under construction or advanced development to proceed. But the following month the government warned that even projects under construction could be halted.

On October 10, according to a Chinese-language report, the government made good on the August warning and moved to stop construction on 30 GW of coal capacity. Greenpeace Asia reported that the official announcement also included orders to scale back plans for transmitting coal-fired power from development regions in the nation’s interior to population centers in the east. Those plans also spell the end for 10 additional coal plants currently under construction, as they will have no connection to the grid without the planned transmission lines.

—Thomas W. Overton, JD is a POWER associate editor (@thomas_overton, @POWERmagazine).

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