China’s power needs will nearly triple to 15000 TWh by 2030 and most of it will still be coal power

“It is very unlikely that demand for thermal coal in China will peak before 2030,” said William Durbin, the Beijing-based president of global markets with Wood Mackenzie, an energy research and consulting firm, in a statement accompanying the release of a new report entitled “China: The Illusion of Peak Coal.”

“Despite efforts to limit coal consumption and seek alternative fuel options, China’s strong appetite for thermal coal will lead to a doubling of demand by 2030,” the report concludes. Coal consumption in China, bolstered by a period of rampant construction of coal-fired plants that has only recently slowed, must rise to feed China’s explosive demand for power, which will nearly triple to 15,000 TWh by 2030. This assumes power demand per unit of GDP to fall by half in just 17 years. If efficiency gains are not achieved then China’s power demands will be even higher.

China’s strong appetite for thermal coal will lead to a doubling of demand by 2030. China’s demand will grow to approximately seven billion tonnes per annum (btpa) of thermal coal which is contrary to speculation that China’s thermal coal demand may be reaching a peak in the next decade.

Solar would need massive breakthroughs and scale one hundred times instead of just ten times

Despite massive investments in nuclear, wind, and solar power, along with a crash program to develop domestic natural gas reserves, no other energy source can replace coal as a source of primary power in the next two decades. China’s leaders are determined to replicate America’s shale gas boom, but “natural gas supplies will struggle to meet demand growth due to modest investment in conventional reserves and the very slow development of domestic unconventional shale gas reserves,” Wood Mackenzie states.

There are hopes that solar could have a 400-600 gigawatt market which is about 400-600 TWh by 2020. Almost none of that will displace large scale energy plants.

China’s gas price and power tariff regulations will need to be reformed in order to create incentives for the national oil companies (NOCs) to make expensive investments in unconventional gas. Mr. Durbin highlights, “Our analysis already assumes an intensive investment program in unconventionals post-2020. To ramp up shale gas developments and production faster to displace coal will require a near-doubling of investment. We expect coal to hold its cost advantage until shale gas breakeven costs fall by 40-50%.”

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