China's CO2 Emissions Fall for the First Time as Clean Power Outpaces Demand Growth

China's CO2 Emissions Fall for the First Time as Clean Power Outpaces Demand Growth Carbon Brief data shows China's emissions fell 1.6% in Q1 2025 even as power demand grew, while Taiwan orders 2,400 MW of gas to replace coal. For the first time, the growth in China's clean power generation has caused the nation's carbon dioxide emissions to fall despite rapid power demand growth, according to a new Carbon Brief analysis. China's emissions were down 1.6% year on year in the first quarter of 2025 and by 1% in the second quarter.⁷ That matters because China's power sector has been the single largest driver of global emissions growth for a decade. Carbon Brief showed that coal generation fell simultaneously in China and India in 2025 for the first time in 52 years, after each nation added record amounts of clean energy. Coal generation in India dropped 3.0% year on year, or 46 TWh. China's fell 1.6%, or 90 TWh. Together, the power sectors of these two countries drove 93% of the rise in global CO2 emissions from 2015 to 2024.⁶ The reversal has not come from reduced demand. China's economy keeps growing. Last year the country burned 4.9 billion tonnes of coal. The Economist described the scale by analogy: imagine a Great Pyramid of Giza, then a line of 1,500 more behind it. Three factors combine to make the appetite so large: a huge economy, an energy-intensive industrial base, and heavy reliance on coal for power.⁴ But the economics are shifting. Renewables are now cheaper than coal in most markets. Solar and wind are growing at what the Economist called a blistering pace. Yet China probably will not greatly reduce its reliance on coal, the same publication argued, because energy security concerns and the political economy of coal-dependent regions like Shanxi province create institutional resistance to retirement.^5,1 The installed base is enormous. Global coal power capacity stands at approximately 2,100 GW as of 2024, down slightly from peak as retirements in developed economies partially offset new construction in developing ones. Coal accounts for roughly 35% of global electricity supply. The retirement timeline for this fleet is the central variable in climate projections.¹ In the US, the power sector is evolving on a different timeline. The EPA reported that the sector contributes approximately 30% of domestic CO2 emissions and 25% of overall greenhouse gas emissions. Nearly 90% of all US coal capacity now features pollution control technologies. Older generation sources are retiring as gas, wind, solar, and battery storage take their place.² Data centre demand is accelerating the transition. EIA projects that data centre server electricity consumption will reach between 446 and 818 billion kWh by 2050. Servers accounted for an estimated 7% of commercial sector electricity consumption in 2025 and could reach 22-33% of commercial building electricity use by 2050. In ERCOT, solar generation is expected to reach 78 billion kWh in 2026, surpassing coal at 60 billion kWh.³ Taiwan's Mai-Liao project illustrates the coal replacement model at scale. Siemens Energy signed an agreement to provide equipment for a 2,400 MW gas-fired combined cycle facility that will replace 1,800 MW of existing coal generation. Emissions per unit of electricity are projected to decrease 58%. The plant will generate nearly 14 billion kWh annually, about 5% of Taiwan's total supply.⁸ The question is speed. China's clean energy additions are large enough to offset demand growth and push emissions down. But the coal fleet is not retiring. China could simultaneously add record renewables and maintain record coal capacity, using coal as a backup that runs fewer hours but stays connected. That path reduces emissions intensity without reducing the installed base.^7,5 What to watch is whether China's Q3 2025 emissions data confirms the downward trend established in the first half, and whether Taiwan's Mai-Liao deal triggers similar coal-to-gas replacements across Southeast Asia. If China's coal generation decline accelerates while coal capacity stays online, the market is pricing a fleet transition that takes decades rather than the rapid retirement some climate models assume.^7,8