China has issued a 3-year action plan to promote the low-carbon transformation of coal-fired power, with plans to diversify financing channels and grant preferential loan policies to qualified projects. The plan will focus on the development of co-firing methods together with CCUS and electricity transmission.

The plan also includes improving carbon reduction technologies for coal-fired power, as well as new infrastructure construction. This will help to ensure China’s energy security amid the global green energy transition, experts said. The plan, co-issued by the National Development and Reform Commission and the National Energy Administration (NEA), will enhance financial support for coal-fired power low-carbon transformation projects. It will be based partly on funds raised via ultra-long special treasury bonds, and there will be policy support based on local conditions.

Coal-fired power low-carbon transformation projects will be encouraged to diversify their financing channels through methods such as issuing green bonds or applying for technology transformation loans. Financial support and preferential loan policies will boost financing, and more private funds may be directed into the field of coal-fired power low-carbon transformation, according to Lin Boqiang, director of the China Centre for Energy Economics Research at Xiamen University.

Data from the NEA showed that from January to May this year, China’s total installed power generator capacity reached over 3000 GW, up 14.1% year-on-year. About 1400 GW of this is provided by coal-fired power generation, representing almost half of the installed capacity and indicating the vital role of coal in China’s energy structure.

The plan also noted that by 2025, the first batch of coal-fired power low-carbon transformation construction projects will all have started, and the carbon emissions of the related projects will be reduced by around 20% compared to the average carbon emissions level of similar coal-fired power units in 2023. By 2027, the low-carbon coal-fired power generation technology route will be further expanded, with significant reductions in construction and operating costs, with the carbon emissions aiming to achieve about a 50% reduction from the level in 2023.