China Sees First Decline in Coal and Gas Power Output in a Decade

Power generation from coal and gas-fired plants in China fell for the first time in a decade, according to official data released today. The decrease, amounting to 1%, brought total output down to 6.29 trillion kWh in 2025. This shift is largely attributed to the growing influence of alternative energy sources, particularly wind and solar.

In December alone, the output from coal and gas plants dropped by a more significant 3.2%. Despite this decline, overall electricity consumption in China increased by 5% compared to the previous year, highlighting the importance of this trend amid rising demand.

Rise of Alternative Energy Sources

The decrease in coal and gas generation is notable not only for its magnitude but also for the context in which it occurred. Alongside the decline in fossil fuel output, China experienced a boost in hydropower generation, which rose by 2.8% over the full year and 4.1% in December. The combination of these factors indicates a shift in the energy landscape, with non-hydrocarbon sources gaining traction.

Forecasts suggest that the downward trend in coal and gas output is likely to continue into 2026 as China emphasizes the expansion of its alternative energy capacity. However, analysts caution that reliance on these renewable sources can be unpredictable, influenced significantly by weather conditions. This unpredictability may lead to fluctuating demand for baseload power from coal and gas facilities.

Recent Trends in Wind and Solar Power

The decline in coal and gas generation aligns with prior expectations voiced by analysts. In mid-December, Bloomberg reported on anticipated trends based on official generation data, noting the significant roles of wind and solar energy in this shift. In November, wind power output surged by 22%, while solar power output increased by 23% compared to the same month in the prior year.

Despite these impressive gains, fluctuations remain evident. Just a month earlier, in October, wind power output had decreased by 12%, and solar power growth was limited to 5.9%. This variability underscores the challenges faced by China’s energy sector as it transitions towards a more sustainable future.

The evolving energy dynamics in China reflect broader trends in the global energy market, where countries are increasingly prioritizing renewable sources. As the nation works towards its climate goals, the impact of this transition will continue to be closely monitored by analysts and industry stakeholders alike.