Power generation at thermal power plants (TPPs), including coal- and gas-fired ones, as well as those powered by fuel oil, increased by 1.5% in 2024, reaching 6,344 terawatt-hours (TWh). A double-digit increase in wind and solar generation notwithstanding, the share of TPPs in the country’s overall energy mix rose from 35% to 37%. This trend has been aided by new capacities: according to Global Energy Monitor, China connected 8.6 GW of coal-fired TPPs to the grid in the first half of 2024, outpacing every country in the world.
Coal-fired TPPs have retained their share due to the spread of technologies that help producers save solid fuel during power generation. This refers to the so-called “ultra-supercritical” coal-fired TPPs, whose efficiency ranges from 44% to 46% (versus 37–40% for “supercritical” TPPs and 33–37% for “subcritical” ones). While ultra-supercritical coal-fired TPPs make up 32% of the coal-fired TPPs operating across China, they amount to 95% of the power plants under construction. In this regard, China is significantly ahead of India, where only 2% of the capacity of coal-fired TPPs is represented by ultra-supercritical plants.
The metals industry, the second-largest coal consumer, reduced its demand for solid fuel last year. An indirect sign of this is that the production of raw materials for steelmaking in China fell by 1.7% in 2024 (to 1,005 million tons). This was partly affected by the crisis in the real estate market, which contributed to the slowdown of the Chinese economy. According to the IMF’s October estimate, China’s GDP growth is slowing down from 5.2% in 2023 to 4.8% in 2024 and 4.5% in 2025.
An offsetting role in this regard, however, was played by the policy of increasing commercial reserves, which was adopted by regulators after 2021, when many power plants were left without sufficient fuel against the backdrop of recovering energy demand. According to the International Energy Agency (IEA), China’s commercial coal reserves exceeded 370 million tons by August 2024, rising from just under 250 million tons in late 2021.
China will most likely continue to increase its coal production in the coming years. The growth will be facilitated by large-scale capital investments in the industry: according to the IEA, annual investment increased from $78 billion in the pre-COVID 2019 to $100 billion in 2023, and was expected to reach $102 billion by the end of 2024 (all values are given in constant prices).
