3-Years later: Impacts of China's Overseas Coal Power Ban

In September 2021, Chinese President Xi Jinping pledged at the United Nations General Assembly (UNGA) that China would halt the building of new coal fired power plants abroad whilst increasing support for green and low-carbon energy infrastructure in developing countries. However, according to CREA’s third annual review of China’s overseas coal ban,with People of Asia for Climate Solutions (PACS), the amount of coal capacity that was cancelled in 2024 has fallen significantly to 5.6 gigawatts (GW), from the 15.9 GW between 2022 and 2023.

In addition to cancellations of China’s overseas projects slowing down, since the publication of CREA’s 2023 report, 7.9 GW of China-backed coal plant capacity has become operational, bringing the total operational capacity to 26.2 GW, up from 18.3 GW in 2023 and 9.2 GW in 2022. The findings indicate that whilst China has shown progress, the country still faces significant challenges in meeting its pledge.

Over the three years following the pledge, a total of 42.8 GW of projects have been cancelled, resulting in a total avoided 4.5 billion tonnes of cumulative lifetime carbon emissions. Yet, 52 power plants remain in the permitted, pre-permit, and construction phases, representing a total additional capacity of 49.5 GW. According to our analysis, cancelling these plants could prevent 202.5 million tonnes of carbon dioxide (CO2) emissions annually, totalling an estimated 5.1 billion tonnes by 2050.

The last year has seen an additional 3.4 GW from previously unannounced overseas power projects advanced directly into the construction phase and 4.9 GW into the pre-permit phase. At least three of these proposed projects are for coal power generation — 1.5 GW in Kyrgyzstan, Zambia and Zimbabwe —in direct violation of the 2021 pledge. Additionally, 700 MW of China-backed coal capacity that had been shelved in the past has been pushed forward or revived in the last year.

To address these barriers to meeting China’s overseas coal ban, we propose the following policy recommendations:

Policy recommendations

· Expand the overseas coal ban to include captive energy projects, which fall into a grey area of the ban whilst representing some of the largest continued expansions of coal power.

· Financiers of overseas projects should shift their focus towards financing renewable energy projects, such as solar, wind, and hydroelectric power.

· Host countries should prioritise and clearly signal their desire to transition towards more sustainable energy solutions, thereby attracting greater investment in this area.

· China should provide technical and financial support for the development of transition strategies in host countries to avoid the possibility of those countries proceeding with coal projects even without Chinese investment.

· Host countries should avoid transitioning from coal to gas, which would only delay the shift to truly sustainable energy sources.

· Financiers should establish transparent reporting mechanisms and public disclosure requirements for all overseas energy projects to allow all stakeholders to monitor the status.