The Financial Times recently reported that renewable energy has surpassed coal as the largest source of power capacity worldwide. While this magnificent feat would not have been possible without the collective efforts of the residential, commercial, and government sectors throughout the world; this achievement is due, in large part, to China and it’s coal cap plan.
Coal Cap Plan: An Overview
Last year, roughly half a million solar panels were installed every single day. Likewise, two wind turbines went up every hour. It seems a little excessive on paper, but China’s Coal Cap Plan has greatly aided the movement towards more sustainable energy usage. The overall objective of the plan is to reduce coal consumption to under 2.5 billion tons of coal by 2020.
“There will be huge uncertainty in China’s future energy consumption mix and carbon emission outlook. Even if total energy consumption growth rate is zero, to replace 1% coal consumption requires 10% growth in clean energy. Professor Boqiang Lin, Dean of the Institute for Studies in Energy Policy at Xiamen University.
Despite increasing installed capacity of renewable energy, utilization hours and profitability are decreasing. According to industrial sources, last year saw the worst wind curtailment. Energy supply was excessive in general and the utilization hours of thermal power plummeted further.”
Renewables have overtaken coal as the world’s largest source of power capacity, and the sector is growing far faster than anyone thought, according to the International Energy Agency.
The IEA says renewables growth has been powered by dramatic falls in the cost of solar and onshore wind power. But the agency also cautions that further growth still depends heavily on government policies. (FT)
Notwithstanding the addition of 71.6GW of new thermal power capacity, as a result of the high marginal cost of thermal supply, total thermal generation declined 2.7%, reports IEEFA. Thermal power plant utilisation rates declined from 56.2% on average over 2014 to a record low 50.9% in 2015.