China's CO2 emissions: A 21-month plateau and the road ahead
China's carbon emissions have been flat or falling for 21 months, a trend that began in March 2024 and continued into the final quarter of 2025. This is a significant development, as it marks nearly two years of stabilization or decline in China's CO2 emissions, which have historically been a major contributor to global greenhouse gas emissions.
But here's the catch: the overall emissions picture is a delicate balance. While emissions have fallen in most sectors, including transport, power, cement, and metals, they have risen in the chemicals industry. This mixed trend has resulted in emissions plateauing at slightly lower levels than the peak reached in early 2024.
Sectoral Breakdown
- Power Sector: Power sector emissions fell by 1.5% in 2025, with coal use decreasing by 1.7% and gas use increasing by 6%. This reduction was driven by a 3% drop in transportation emissions and a 7% decline in emissions from cement and other building materials.
- Chemical Industry: The chemicals industry stands out as the main source of CO2 emissions growth, with a 12% increase in emissions. This is due to a 15% rise in coal use and a 10% increase in oil use, which more than offset the reductions in other sectors.
- Clean Power: Solar and wind power generation increased by 43% and 14%, respectively, while nuclear power grew by 8%. This clean power surge helped reduce coal generation by 1.9%.
- Energy Storage: Energy storage capacity experienced a record growth of 75GW, outpacing the rise in peak demand of 55GW. This trend is crucial as it allows for a more flexible and sustainable energy system.
Implications and Challenges
- Carbon Intensity: China's carbon intensity, measured as fossil fuel emissions per unit of GDP, fell by 4.7% in 2025. However, this is short of the 18% target set by the 14th five-year plan for the 2020-2025 period.
- Paris Agreement Commitments: To meet its key climate commitments under the Paris Agreement, China needs to reduce carbon intensity by around 23% over the next five years. This is a significant challenge, especially with the upcoming publication of the 15th five-year plan.
- Peak Emissions: The question of whether China's emissions have already peaked or will rise again is crucial. Official plans aim for emissions to peak before 2030, but the current plateau could be a temporary respite before a rebound.
Clean Power and Energy Storage: The Way Forward?
The growth in clean power generation and energy storage capacity is a promising sign. In 2025, clean power additions met all the growth in electricity demand, and energy storage capacity grew faster than peak electricity demand. This trend, if sustained, could help China transition to a cleaner energy mix and potentially peak its CO2 emissions.
However, there are challenges. The growth in solar and wind power generation has not kept pace with capacity increases, indicating underutilization. This is likely due to grid congestion and curtailment issues, which need to be addressed to fully harness the potential of renewable energy.
The Chemical Industry's Impact
The chemical industry's emissions growth is a notable concern. Without this sector's increase, China's total CO2 emissions would have fallen by an estimated 2% in 2025. The coal-to-chemicals industry's expansion plans and the development of oil and gas prices will significantly influence China's future emissions trajectory.
Outlook and Uncertainties
China's CO2 emissions have been stable or falling for 21 months, but a small increase could push them beyond the previous peak. Official plans call for emissions to peak before 2030, but the country's commitment to its 2030 carbon intensity pledge is uncertain. The upcoming 15th five-year plan will be a critical indicator of China's climate ambitions.
The clean energy boom has been a driving force for GDP growth and investments, but the future of this trend is not guaranteed. The role of provincial and state-owned enterprise plans could be pivotal in raising ambition, as they have in the past.
The question remains: Can China sustain its clean energy momentum and meet its climate commitments? The answers will shape not only China's energy landscape but also its global climate leadership role. And this is the part where your opinions and insights can make a difference. What do you think are the key challenges and opportunities for China's energy transition? Share your thoughts in the comments below!
