A coal-powered power station emits smoke in Datong, China's northern Shanxi province, in November, 2021.NOEL CELIS/AFP/Getty Images
Canada is embracing the carbon business again. New oil pipelines are almost certainly coming and the Alberta tar sands will expand to feed them. In the European Union, natural gas plants are under construction and coal lives on in some countries.
All in all, this is bad news for the health of the planet, but can you blame the overhauled Canadian and European energy plans? No Canadian or European leader will admit so publicly, but it appears that they realize that any of their own carbon savings would be more than offset by the still-rising output of greenhouse gases in China. U.S. President Donald Trump figured that out long ago.
The corporate bosses in the EU, home to crippling electricity prices, are especially galled by the failure of the green agenda to bring down power bills. Deindustrialization is the outcome while coal-mad China goes in the opposite direction, as the latest trade figures suggest. According to China’s customs agency, the country’s trade surplus in the first 11 months of 2025 will exceed US$1-trillion, in spite of the Trump tariffs, putting it on a record trajectory for the full year. China can keep its trade surplus intact in good part because of cheap, plentiful energy produced from hydrocarbons, especially coal.
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China plays a clever PR game: Ever-rising output of renewable energy and low- or zero-carbon products, like electric vehicles (EVs), make the headlines; the country’s rising carbon emissions receive much less publicity. China is certainly a green-energy champion but continues to rely on coal plants to generate more than half of its electricity.
There is no doubt that China is turning its green agenda into a world-beating force. In 2024, EVs accounted for almost half of all Chinese car sales, according to the International Energy Agency. The 11 million EVs sold in China last year were greater than total global sales of such cars just two years earlier.
At the same time, some 85 per cent of global lithium-ion battery cell manufacturing is done in China. About 80 per cent of solar panels sold around the world are Chinese. China also dominates the production of wind vanes used to make electricity. China would rather you ignore the fact that much of the domestic production of these products is powered by fossil-fuel plants, as is the electricity for charging EV batteries.
Generating electricity from coal, as China has learned, has huge advantages.
Coal plants can be built quickly and relatively cheaply. There are endless supplies of thermal coal and today’s prices are a quarter of their peak in 2022 and 2023, when the pandemic recovery sent electricity demand in China, India and elsewhere soaring. Coal power is also more flexible; output from coal plants, unlike that of nuclear power, can be quickly ramped up or down depending on demand.
No wonder that the construction of coal plants in China never ceases. Britain’s Carbon Brief climate website earlier this year reported that China accounted for 93 per cent of all new coal-plant construction in 2024. If completed, those plants would boost electricity generation capacity by almost 95 gigawatts (GW), the highest rate in a decade. That’s the equivalent of about 60 per cent of Europe’s total nuclear power production, and seven times that of Canada’s.
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There is every reason to believe that China’s coal-plant construction pace continued this year, in spite of Beijing’s pledge to “strictly control” the rollout of new capacity, and will continue in the years to come. China’s demands for energy security means coal will live on even though the fuel is the top source of carbon dioxide emissions from electricity production.
The EU has spent decades winding down its coal program. Poland is the only large EU country where half or more of its electricity comes from burning the grubby fuel. The plants face their last gasp in 2049, when the last of Poland’s coal mines is set to close.
But with electricity prices atrociously high in the EU and energy-intensive industries closing or decamping to cheaper countries, hydrocarbon-fueled electricity production is far from dead. Germany is building 10 GWs of gas-fired power plants on the condition that they can run on hydrogen power at some point. Italy, Greece and several other EU countries are doing the same in an effort to keep a lid on electricity prices and ensure that supplies are secure when the sun doesn’t shine and the wind doesn’t blow. Elsewhere, net-zero power projects are being postponed or cancelled.
Europe has come to the belated conclusion that renewable energy alone cannot keep its industrial base intact or its voters happy. Germany, Britain and Italy, each watching the erosion of its industrial base, have the highest industrial electricity prices in the developed world, roughly twice those of the U.S. and 50 per cent more than China, according to a recent Wall Street Journal report.
Europe realizes it cannot compete with China or the U.S. if it delivers a death sentence to all its hydrocarbon plants. The net-zero agenda will be delayed to preserve industries and their jobs. China knew that all along, not Europe.