Renewables helped drive 62% drop in new coal power capacity in 2016, finds report

Bucking a decade-long trend of coal power capacity expansion, 2016 saw new coal power plant construction starts fall globally by 62% as leading coal consumers such as China and India leaned more heavily than ever on renewable energy capacity, finds a new report by CoalSwarm, Sierra Club and Greenpeace.

The report, titled Boom and Bust 2017: Tracking the global coal plant pipeline, concludes that coal power is in “freefall”, and finds a 48% reduction in pre-construction activity and a 19% fall in ongoing construction. Globally, the coal power pre-construction pipeline now stands at 570 GW, down from 1,090 GW in January 2016.

And while these are still huge numbers, the trend could prove debilitating for coal in only a matter of years, the report’s authors believe. China and India have collectively frozen 68 GW of coal power construction at more than 100 project sites, while as much as 64 GW of coal capacity has been retired over the past two years – largely in the U.S. and the European Union (EU).

Optimism from the findings of the report was tempered by a warning that in many nations, coal power capacity additions are accelerating, namely in Indonesia, Turkey, Vietnam and Japan, while the recent slowdown in India and China could cease if further policies to support renewable energy are not reinforced.

However, the potential impact of clean energy policies in China should not be underestimated. CoalSwarm analysis shows that up to 300 GW of coal power plans have been put on hold until the current Five Year Plan (2016-2020) expires. This figure includes 55 GW of capacity that was already under construction.

In India, the National Solar Mission and the government’s intent of reaching 175 GW of installed renewable energy capacity by 2022 has punctured coal’s growth, where 13 GW of potential coal capacity is currently paused.

Between 2006 and 2016, China and India accounted for 86% of all coal power built globally, which highlights how vital it is for these two nations in particular to continue to pursue clean energy policies.

In more developed economies such as in Europe and the U.S., it is the retirement of existing coal power plants that is having the most impact. In 2016, 27,041 MW of coal plants were retired globally, with 36,667 MW retired in 2015. It is renewable energy that is helping to facilitate this shift.

The report stresses that, in order for the global temperature increase to be kept below 2C by 2050 (as outlined in the Paris Agreement), China and India must stay the low-carbon course, emerging economies must seek to leapfrog to renewables as soon as possible, and OECD nations must aggressively replace aging coal plants with clean energy.

“The decline in new coal plants in Asian countries is truly dramatic,” said Paul Massara, head of North Star Solar and former chief executive of RWE Npower. “This shows how a perfect storm of factors are simply making coal a bad investment.”

Sierra Club senior campaigner Nicole Ghio added that markets are now demanding clean energy, and railed against U.S. President Donald Trump’s recent calls to help support the country’s ailing coal industry. “No amount of rhetoric from Donald Trump will be able to stop the fall of coal in the U.S. and across the globe.”

Recent data from SolarPower Europe revealed that 76.2 GW of solar capacity was added globally in 2016 – a 50% increase in the space of one year. Cumulatively, the world now has 305 GW of solar power installed, up from just 50 GW in 2010.