Coal power overcapacity in China: Province-Level estimates and policy implications

Since the project approval right was decentralized from the central government to the local governments in 2014 in China, a large quantity of coal power projects has been approved and built, resulting in low operation efficiency and calling for strict de-capacity policy. In this paper, we estimate coal power overcapacity with a cross-province power and energy balance model. We estimate the overcapacity situation in 2015 at 140-160 GW with a comprehensive dataset. The 2020 overcapacity scenario is estimated with detailed representation of official planning and new projects under construction. The results show that there is a general trend of growing overcapacity in most provinces by 2020 and the national excess scale will be around 210 GW under the basic scenario and may even reach 240-260 GW under a High scenario. Relevant policy suggestions are put forward to address the overcapacity issue.