By May 12, 2017 Read More →

Approvals for new coal fired power plants in 29 Chinese provinces suspended

Coal fired power

The Chinese government is suspending approvals for coal fired power plants in 29 provinces. Getty Images photo.

Coal fired power plants would create environmental risks

Approvals for new coal fired power plants in 29 provinces in China will be suspended, according to a report in the official China Securities Journal on Friday.

Reuters reports the National Energy Administration (NEA) has put as many as 25 provinces on “red alert”, meaning the new projects would create severe overcapacity or environmental risks.  Another four provinces were put on “orange alert”, according to the newspaper.

Of the 32 Chinese provinces, Tibet was not subject to a capacity warning and two others were awarded “green” status.

Utilization rates at coal fired power plants in China have fallen due to slowing growth in power consumption and the NEA has designed the warning system to identify areas that need to curb overcapacity.

That overcapacity has reduced margins of major coal fired power producers, especially in areas under pressure to meet state requirements to raise use of renewable energies.

In March, Beijing announced in a report that it is looking to close down, cancel or slow down the construction of over 50 gigawatts (GW) of thermal power capacity in 2017.

NEA data shows average utilization rates at the country’s predominantly coal fired thermal plants was down 4.6 per cent to 4,165 hours last year.  Despite the reduced use, total thermal capacity, including oil and gas fired plants, rose by 5.3 per cent to 1,054 GW in 2016.

According to the industry lobby group, China Electricity Council, in April, utilization rates had fallen further in some areas in the first quarter of this year, particularly in the northeast and northwest.  The drop put margins at power plants under further pressure.

The warning system also takes into account the resources and pollution levels of each area.  Some coal-dependent provinces are facing extreme water shortages or are under pressure to control smog, including Beijing.

At the end of 2016, China’s total coal fired capacity was 940 GW and by the end of 2020, is expected to reach 1,300 GW, much higher than the 1,100 GW target in China’s 2016-2020 five-year plan.








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