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THE carbon emissions produced by China’s power sector are to peak by 2030 as natural gas and renewables take the place of coal, according to a report by Bloomberg New Energy Finance.

In its report on The Future of China’s Power Sector, the analyst and research group predicts that over the next 17 years the country will more than double its current power generation capacity. By 2030, it will be generating more than 2,700 GW, adding capacity equivalent to that of the entire UK every year.

Though coal – which currently generates more than two-thirds of China’s power – will probably remain the biggest player in China’s energy mix by a wide margin, the analysts predict that the majority of new capacity will come from renewables. According to their model, by 2030 some 44% of the country’s power would have been generated by solar, hydro, wind or biomass.

Natural gas is also expected to grow over the coming decades, supplying around 6% of China’s power.

“The new Chinese leadership is responding to calls for more equitable and sustainable economic growth, a faster pace of reform, and to concerns over environmental degradation,” the Bloomberg analysts write.

“Expected structural reforms will gradually reduce the government’s interference in the economy, allow more private capital to enter state-dominated sectors such as energy, and impose further environmental controls.”

One of the consequences of this move toward renewables and comparatively low-carbon gas instead of coal is that the power sector’s carbon emissions are expected to peak within just 14 years, before slowly falling off in the face of cheaper, more efficient renewables.

All of this will come at a price, however. Bloomberg estimates that China will have to spend around US$159bn/y building up new capacity – some 2% of its GDP. Of this, around US$77bn will be spent on renewables. The extra capacity will also force the country to spend US$57bn/y on new power infrastructure, especially the smart grid and storage projects needed to cope with the intermittent nature of renewables.

“To stimulate a cleaner supply mix, stronger support for renewable energy, natural gas, energy efficiency and clean coal technologies needs to be provided,” says the report. “Shale gas has major potential, but its development is heavily dependent on the right regulatory conditions and addressing water availability issues.

“A well structured carbon pricing mechanism, such as a tax or an emissions trading scheme, will give the right incentives to ensure power sector emissions peak early in the next decade.”