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China coal power rises for fourth straight month as Hormuz disruption squeezes gas and oil imports
Shipping disruptions cut China's crude and gas imports sharply in April, forcing greater coal burn even as solar additions slumped 31%.
Coal-fired power generation in China rose for the fourth consecutive month in April, driven by a combination of weak renewables output and a sharp fall in fossil fuel imports linked to Strait of Hormuz shipping disruptions, according to Centre for Research on Energy and Clean Air data published on Friday (2026-05-21).1
Crude oil and natural gas imports fell by around 20% and 13% year-on-year, respectively, in April, CREA analysts Qi Qin, Danny Hartono and Lauri Myllyvirta reported. The fossil fuel squeeze added pressure on the chemical industry and pushed grid operators toward domestic coal.1
Total power generation rose an estimated 6.6% year-on-year in April, but weak wind conditions, subdued solar output and extended nuclear refuelling outages left coal as the swing fuel.1 Wind power additions did rise 8% in April, but that came too late and too slowly to offset the broader shortfall.1
The coal rebound sits awkwardly alongside China's own commissioning data. Thermal power capacity additions in the first quarter surged more than 160% year-on-year to a record high, while solar capacity additions fell 31% over the same period against a high base from early 2025.1 Solar additions still exceeded the level seen in the first quarter of 2023, meaning the technology is still scaling — but more slowly than the grid requires right now. A construction site for the Ningxia Electric Investment Yongli 2×660 MW coal-fired power project in Yinchuan was active in March 2026, a visible sign that new coal capacity is still being built as clean energy deployment cools.1
Solar cell production fell 25.6% year-on-year in April, reflecting both weaker domestic installations and a slight pullback in exports after March.1 Battery output moved the other way, rising 55.6% year-on-year, supported by energy storage demand and exports. New energy vehicles continued to gain share in total vehicle production.1
China's coal import picture adds another layer. Imports fell 6% year-on-year in March 2025 to 38.73 million metric tonnes, a historic low as domestic production surged and prices dropped to their lowest levels in four years, according to data from China's General Administration of Customs.4 Analysts attributed the decline to weak demand, high port inventories and narrowing import profit margins — dynamics that have pushed Chinese buyers toward local mines and away from overseas suppliers.4
Against that backdrop, ICE Brent crude front-month stood at $84.53 as of 05:12 UTC on Thursday (2026-07-16), down 0.28% on the session. [LIVE_PRICES] ICE Endex TTF front-month was at €54.37, up 2.47%, as of 20:05 UTC on Wednesday (2026-07-15). [LIVE_PRICES] JKM for Asian LNG was flat at $19.93 as of 05:12 UTC on Thursday (2026-07-16). [LIVE_PRICES] With gas import costs elevated and seaborne supply constrained, the relative economics continue to favour domestic coal over imported gas for Chinese grid operators.
Longer-term forecasts point firmly toward solar. BloombergNEF projects solar will surpass coal, oil and natural gas as the largest source of power globally by 2035, with panel costs expected to fall another 30% over the coming decade.3,2 But near-term grid management in China is being determined by shorter cycles: seasonal import disruptions, a high renewables base from 2025 distorting year-on-year comparisons, and commissioning pipelines that were locked in years before the current clean energy slowdown.
Industrial value-added growth also slowed in April, CREA noted, adding uncertainty around whether demand will recover quickly enough to require a rapid scale-up of any particular fuel.1
Whether solar deployment recovers pace in the second half of the year will determine how long coal holds its current position as the marginal supply source. If domestic installation momentum does not pick up and Hormuz-related shipping constraints persist into the second half, the gap filled by coal in April is unlikely to narrow quickly.1