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China’s climate and energy policies present something of a paradox: while expanding clean energy at breakneck speed, China has also been building new coal power plants.
In 2023 alone, 70 gigawatts (GW) of new coal-fired power capacity was constructed in China, up four-fold since 2019 and accounts for 95% of the world’s new coal power construction activity in that year.
This surge of coal capacity raises concerns about China’s carbon dioxide (CO2) emissions and climate goals, as well as the risk of stranded assets down the line.
Coal is being pitched by the Chinese government as the means to guarantee energy security and to meet rapidly-rising peaks in electricity demand, because solar and wind output is variable.
At the same time, China’s electricity sector is seeing major changes in terms of costs, demand patterns, regulation and market operation. Our new study indicates that the traditional economic calculus used to justify new coal capacity may be outdated.
Using a simple, analytical metric for evaluating the most economic way to meet peak demand, we show that a combination of solar plus battery storage may be a more cost-effective option than new coal.
- How has China’s electricity landscape changed?
- How does an alternative metric evaluate the cost?
- What is the most economic way to meet peak demand?
- How can our solution help China with its climate goals?
How has China’s electricity landscape changed?
Over the past decade, the costs of renewables and battery storage have decreased substantially, peak-time residential and commercial demand has surged, and wholesale electricity markets have gained greater traction.
Meanwhile, China also announced “dual carbon” goals of peaking CO2 emissions before 2030 and reaching carbon neutrality by 2060. Given these transformations, building more unabated coal power conflicts with China’s long-term climate commitments and may no longer be the most cost-effective option to meet demand growth. It also diverts much-needed capital from the transition toward a clean power system.
How does an alternative metric evaluate the cost?
Our study introduces an alternative metric for calculating the cost-optimal investments needed to meet rising peak electricity demand.
This metric, “net capacity cost”, is the annualised fixed costs of investment in infrastructure needed to meet peak demand minus electricity market revenues earned by this infrastructure, or its “system value”. In this metric, a negative figure means that instead of a cost, such investments would turn a profit.
To explore this metric in a Chinese context, we use a simple example of a 1,500 megawatt (MW) increase in peak electricity demand and a 6,570 gigawatt hour (GWh) rise in demand across a full year, in a hypothetical province.
We then outline five strategies (cases) for meeting these peak and annual energy demands, ranging from heavy reliance on coal through to a combination of solar and battery storage.
In the different cases, resources are sized based on how much they can reliably contribute to peak supply needs and annual energy needs:
- Case 1: New coal power capacity meets all of the growth in both peak and annual energy demand.
- Case 2: Solar meets 70% and coal meets 30% of annual energy demand growth; solar contributes 525MW to peak supply needs – based on a “capacity credit” to discount solar capacity because it may not generate during peak periods – while coal provides the remaining 975MW.
- Case 3: Solar meets all annual energy demand growth; solar and coal both contribute 750MW to peak supply needs, again discounting solar with a capacity credit.
- Case 4: Solar meets all annual energy demand growth; solar and batteries both contribute 750MW to peak supply needs; batteries provide frequency regulation reserves (backup power for managing minute-to-minute differences between supply and demand).
- Case 5: Solar meets all annual energy demand growth; solar and batteries both contribute 750MW to peak supply needs; batteries provide energy arbitrage (charge when prices or costs are low, discharge when they are high).
For each case, shown in the table below, we calculated the annual net cost for both the individual resource (coal, battery or solar), as well as for the system as a whole for securing one kilowatt (kW) of power generation capacity in yuan per year.
The resource net capacity cost in the top half of the table is the net cost of that resource (i.e., the annualised fixed cost minus annual revenue that resource earns from providing energy and ancillary services, such as frequency regulation). Positive numbers show a net cost to the grid operator in adding or procuring that resource.
The total system net capacity cost, in the second half of the table, is the net cost of meeting peak demand growth with the combination of resources in each case.
The weighting that we used to calculate system net costs is based on the ratio of installed capacity and peak demand growth.
Cost of different combinations of energy sources to meet electricity demand
| Case 1 | Case 2 | Case 3 | Case 4 | Case 5 | |
|---|---|---|---|---|---|
| Resource net capacity cost (yuan per kW per year, per kW of installed capacity) | |||||
| Coal | 424 | 424 | 512 | ||
| Battery | 248 | 781 | |||
| Solar | -128 | -128 | -128 | -128 | |
| System net capacity cost (yuan per kW per year, per kW of capacity used to meet peak demand, after capacity credit) | |||||
| Coal | 471 | 306 | 236 | ||
| Battery | 138 | 434 | |||
| Solar | -223 | -319 | -319 | -319 | |
| Total | 471 | 83 | -83 | -181 | 115 |
Cost of capacity with different combinations of coal, solar and storage for meeting peak demand. Source and credit: Lin and Kahrl (2024)
In order to stress-test this simple analysis, we looked at sensitivities of a variety of prices for different sources.
With solar prices in China already very low, our sensitivity analysis focused on the price of coal, batteries and other inputs to the analysis.
What is the most economic way to meet peak demand?
Our results indicate that when battery storage provides frequency regulation reserves (case 4), a combination of solar and storage is the most cost-effective option for meeting peak demand growth.
This combination could cost grid operators -181 yuan (about -$25 or -£20) for each kilowatt of capacity added.
In contrast, building new coal capacity to meet peak demand growth (case 1) is the most expensive option, with a net capacity cost of 471 yuan (about $65 or £52) for securing one kilowatt of capacity per year.
Case 3, in which large coal power plants are only used for backup power (little to no generation), may not be politically feasible in China, at least in the near term.
The other two cases (case 2 and case 5) are more comparable, but given that battery prices have fallen by more than 30% since this analysis was performed – to about 1 yuan (about $0.14 or £0.11) per watt-hour (Wh) of capacity – the batteries in case 5 are likely more economically attractive than the coal in case 2.
How can our solution help China with its climate goals?
To navigate this changing landscape, our analysis suggests that a near-term strategy for meeting China’s rising energy demand while also working towards its climate goals involves enabling battery storage participation in electricity markets.
Currently, the Chinese government allows “new energy storage”, including batteries, to participate in the electricity market. However, the detailed regulations are ambiguous and battery participation could be made simpler.
For example, battery storage is not allowed to provide “operational reserves” referring to capacity that is held in reserve to manage unexpected differences between supply and demand. Making battery storage eligible for this would enhance its business case.
Allowing greater market participation for battery storage would foster continued innovation and cost reductions in battery storage systems, while offering valuable operational experience for system operators.
Such a strategy would be consistent with market outcomes and reflects recent electricity market experience in the US and Europe.
It would also help to resolve near-term capacity and energy needs, as batteries and solar generation can typically be built more quickly than coal-fired power plants.
Moreover, it would help to alleviate future conflicts between new coal generation and renewable energy. New coal generation built mainly as a backup for renewable generation will either rarely operate or encroach on operating hours and net income for other existing coal generators, creating new stranded asset risks.
Continued electricity market reforms would also facilitate more efficient investments in renewable generation and electricity storage.
Allowing wholesale electricity prices to be set by the market and allowing renewable generation and electricity storage to participate in wholesale markets can enhance their revenue and profits.
Furthermore, the reforms would encourage the efficient utilisation of electricity storage, which is our key finding. Electricity storage can provide a variety of functions for the electricity system; wholesale prices can help to guide the operation of storage toward those functions that have the highest value at the lowest cost.
The recent directive from China’s national energy administration (NEA) that integrates new types of storage facilities (non-pumped hydro) into grid dispatch operation is a step towards the reforms we outline.
Appropriate compensation mechanisms, such as capacity payments in some provinces, for all the services that such storage facilities provide, may need to be further defined to promote the sustainable development and integration of these storage facilities into the grid.
Finally, additional supply alone is unlikely to be the lowest-cost way to meet growth in electricity demand in China. Improving end-use efficiency and “demand response” can also help to reduce the overall cost of supplying electricity.
As China continues its electricity market reforms, regional market designs linking multiple provinces, as well as and regional approaches to resource adequacy that encourage resource sharing among provinces, could also help to meet China’s rising electricity use and peak demand in the most cost-effective and lowest-carbon way possible.
The post Guest post: Solar plus batteries ‘cheaper than new coal’ for meeting China’s rising demand appeared first on Carbon Brief.
Guest post: Solar plus batteries ‘cheaper than new coal’ for meeting China’s rising demand
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An older teaching about land acknowledgement
As I have come to understand the spirit and intention of land acknowledgement, I often return to fond memories of my grandmother and her words of wisdom. She taught that the health of the places we call home comes first, because the wellbeing of the people depends on it.
In her teaching, land acknowledgement began with the land. Long before it became a paragraph read at the start of a meeting, it was a way of recognizing a homeland: its waters, its species, its seasons, and the spirit that revealed whether the place was well.
Her teaching echoes a practice found across many Indigenous Nations. Haudenosaunee gatherings, for example, have long opened with the Ohén:ton Karihwatéhkwen, the Thanksgiving Address, often translated as “the words that come before all else.” The speaker greets and gives thanks to the people, the earth, the waters, the plants, the animals, the winds, the sun, the moon and the stars. Only after everything that sustains life has been acknowledged does the gathering turn to its own business.
That order changes what an acknowledgement is for. Its purpose was to share the story of a place with neighbours and to draw them into the work of tending it. People entered the story second, as the ones responsible for what had just been named.
Understood this way, an acknowledgement does more than open a meeting. It asks us to reconsider where we stand, and what we owe the ground beneath us.
Nations among nations
In her teaching, people are one nation among many. The salmon are a nation. So are the cedars, the bison, the medicine plants, and the pollinators. Each belongs to a place, carries its own responsibilities, and offers gifts no other nation can give.
This idea of kinship runs through many Indigenous philosophies. The phrase “all my relations,” heard in ceremonies and gatherings across Turtle Island, is a reminder that family extends beyond people to the animals, plants, waters and lands that make life possible. Some Indigenous languages carry the same understanding in their grammar, speaking of many plants, animals and natural forces as living beings rather than objects.
Sovereignty, understood through this relationship, is a kind of standing more than a form of control. Each nation belongs fully to its place and carries its share of that place’s life. No nation thrives alone, and none thrives by taking over the whole.
The land is also the source of instruction. Over generations, people watched how a river valley or a stretch of prairie kept itself well: who arrived when, who fed whom, and how much could be taken before the giving stopped. In my grandmother’s telling, those observations became instructions, and those instructions helped shape law and protocol. They guided when to harvest, where to camp, how to enter a neighbour’s territory, and what was owed in return.
Indigenous legal scholars today often describe this as law that comes from the land itself, learned by watching how living systems sustain one another. A plainer name for it is knowing how to live somewhere.
The host and the guest
One of the clearest teachings in this understanding of the world is the relationship between host and guest. My grandmother invited us to recognize that relationship in the lives of plants and animals.
A host prepares the place before anyone arrives. A beaver family dams a stream, and the pond becomes a home for fish, frogs, birds and plants. A fallen tree becomes a nurse log, feeding the next generation of seedlings as it returns to the soil.
A host offers first. A flowering plant sets out nectar. A berry bush ripens fruit. These provisions come in their own season, not whenever a visitor happens to want them.
A host also makes its presence known. Birdsong, scent and the marks left along a trail tell newcomers that a place is already inhabited. The visitor does not arrive in an empty world.
The guest has responsibilities too. A guest attends to the season and to what the place can offer. A guest does not assume that everything within reach is theirs to take. A guest leaves something that helps sustain the relationship.
A bee takes nectar and carries pollen. Read through this teaching, that exchange offers an image of visiting well: receiving a gift while helping the host continue its life.
Many Indigenous harvesting protocols carry the same ethic into daily practice: ask before taking, take only what is needed, offer thanks, and leave enough for others and for the plant or animal to recover.
None of this suggests that every relationship in nature is peaceful or generous. These are ways of seeing responsibilities that people can learn to carry.
Everyone is both
No being is only a host or only a guest.
A tree makes room for other life while depending on soil, water, sunlight, fungi, and relationships beyond itself. People, too, may welcome others into their homes while remaining dependent on the larger homeland that sustains them.
The distinction between host and guest is therefore about roles, not ranks. Everyone receives. Everyone has something to give.
The question is whether the exchange sustains the place.
A visitor who takes without restraint leaves less for those who come next. A host who neglects the place has less to offer. Both have responsibilities, and neither can fulfil them alone.
This is the heart of reciprocity, a principle found across Indigenous philosophies: relationships stay healthy when gifts move in both directions. The Haudenosaunee teaching of the seventh generation extends that exchange across time, asking that decisions made today leave the place well for those not yet born.
Mutual benefit begins here, with the recognition that different beings carry different gifts and obligations.
What people carry forward
My grandmother’s teaching connects these relationships to the ways people meet their neighbours.
The host prepares a place, offers food and rest, and explains where the visitor has arrived. The guest makes themselves known, explains why they have come, listens to the terms of the visit, and brings something in return. The gift may be material. It may also be labour, knowledge, news, or a commitment to help.
Nations around the Great Lakes carried this ethic into treaty. The Dish with One Spoon, an agreement among the Haudenosaunee, Anishinaabe and allied Nations, describes shared hunting grounds as a single dish. Everyone eats from it with one spoon, takes only what they need, leaves enough for others, and keeps the dish clean. The Two Row Wampum, between the Haudenosaunee and European newcomers, shows two vessels travelling side by side on the same river, each keeping its own ways and neither steering the other.
In this understanding, acknowledgement is more than naming the people associated with a territory. It is learning enough about a homeland to behave responsibly within it.
Whose home is this? What sustains it? What laws and agreements guide our presence? What can we receive, and what must we return?
These questions make acknowledgement a relationship rather than a recital.
They also make it diplomatic. A guest who recognizes the host’s homeland recognizes that they have entered a place with its own relationships and responsibilities. A host who welcomes the guest makes room for an encounter governed by those relationships.
Neither arrives without standing. Neither arrives without obligations.
Beginning with place
I write from the shores of the Bay of Quinte. Here, the teaching asks me to begin with the water, the shoreline, and the life they sustain. Before I describe myself, I must attend to where I am.
That does not make people or history less important. It places them within the homeland that gives them meaning. The people, their laws, their agreements, and their responsibilities all belong to the place.
In a time of longer fire seasons, troubled waters, and uncertainty about what the next season will bring, this teaching asks something difficult and useful of us: pay attention before you speak.
An acknowledgement cannot tell the story of a place if the speaker has stopped noticing it.
The land came first. Beginning there again means learning to name what sustains us, and accepting that what sustains us also asks something of us.
By Rye Karonhiowanen Barberstock
Photo by Andrik Langfield on Unsplash
The post The Land Came First appeared first on Indigenous Climate Hub.
Carbon dioxide (CO2) emissions from fossil fuels and cement are projected to fall by around 0.4% in 2026 to 38.2bn tonnes of CO2 (GtCO2), according to new figures from the Global Carbon Project.
This guest post is by:
- Dr Zeke Hausfather, Carbon Brief’s climate science contributor
- Prof Pierre Friedlingstein, chair of mathematical modelling of climate systems at the University of Exeter and part of the Global Carbon Project team.
Carbon dioxide (CO2) emissions from fossil fuels and cement are projected to fall by around 0.4% in 2026 to 38.2bn tonnes of CO2 (GtCO2), according to new figures from the Global Carbon Project.
The 21st edition of the annual “global carbon budget” report, published today, says that this small decline is largely due to a 1.9% drop in emissions from oil and the energy shock triggered by the Iran conflict and the closure of the strait of Hormuz.
Emissions from coal continue to increase slightly.
The Global Carbon Project’s projections for fossil fuel and cement CO2 emissions in 2026 are preliminary, with a range that spans a fall of -1.5% to a rise of +0.6%.
This means a small increase in emissions can not be ruled out.
Emissions from land-use change, such as deforestation, are projected to rise in 2026.
This is primarily driven by peat fires and forest degradation in south-east Asia and is linked to the development of a strong El Niño event this year.
As a result, total CO2 emissions from fossil fuels and land use are projected to reach a record high of 43.3GtCO2 in 2026 – marginally above 42.8GtCO2 in 2025.
Research published alongside the report by the same team in