China’s electricity consumption continues to outpace its GDP growth – Power Technology

Report on China’s Electricity Sector and Sustainable Development Goal Alignment

Electricity Demand and Economic Context

China’s electricity consumption is projected to experience significant growth, outpacing its Gross Domestic Product (GDP). This trend is driven by a strategic shift towards energy-intensive industries and the rapid electrification of key sectors, aligning with several Sustainable Development Goals (SDGs).

• Projected Power Consumption (2030): 13,757 TWh
• Compound Annual Growth Rate (2024-2030): 6.3%
• Real GDP Growth (2024-2030): From $2.01bn to $2.31bn

This robust increase in electricity demand is progressively being met by clean energy sources, reflecting a national commitment to SDG 7 (Affordable and Clean Energy) and SDG 13 (Climate Action).

Transition Towards Sustainable Energy: A Focus on SDG 7 and SDG 13

China is actively transitioning its energy matrix to mitigate climate impact and ensure energy security. While coal is expected to remain a primary generation source in the short term, significant policy measures are in place to foster a sustainable energy future.

1. Growth in Renewables: Generation from hydropower and other renewable sources is expanding, reducing reliance on fossil fuels.
2. Coal Moratorium: In pursuit of SDG 12 (Responsible Consumption and Production), the government has halted the construction of new coal-based power plants in key economic regions, including Hong Kong, Shanghai, and Beijing.
3. Economic Pivot: The national shift from heavy industry to service and high-tech sectors is anticipated to further decrease the demand for coal.

Sectoral Analysis of Power Consumption and Industrial Innovation

Consumption Breakdown by Sector (2024)

The industrial sector remains the dominant consumer of electricity, highlighting the importance of energy efficiency and sustainable industrialization practices under SDG 9 (Industry, Innovation, and Infrastructure).

• Industrial Sector: 67%
• Residential Sector: 15.6%
• Commercial Sector: 4.4%
• Transport Sector: 2.3%
• Other Segments: 10.7%

Emerging Industries Propelling Sustainable Infrastructure (SDG 9)

The rapid growth of electricity-dependent emerging industries is a primary driver of future power demand. This development is central to achieving SDG 9 by building resilient infrastructure and fostering innovation.

• Electric Vehicles (EVs)
• Artificial Intelligence (AI)
• Data Centres
• Semiconductors
• 5G Infrastructure

Investment Opportunities in Sustainable Energy Infrastructure

Renewable Energy Expansion

Significant investment opportunities exist in China’s clean energy sector, directly supporting the objectives of SDG 7.

1. Gas-Based Generation: As a transitional energy source, gas-based power generation is poised for growth due to government initiatives to curtail coal.
2. Wind and Solar Power: China has made substantial advancements in wind and solar energy, with both sectors set for continued expansion.
3. Offshore Wind Development: The country is committed to expanding its offshore wind capacity by aligning electricity costs with market prices and constructing larger, more efficient turbines.

Smart Grid Development for Enhanced Efficiency

The government’s commitment to modernizing public electricity supply infrastructure presents major investment opportunities in smart grid technology. This focus on efficiency and resilience is critical for supporting SDG 7 (Affordable and Clean Energy), SDG 9 (Resilient Infrastructure), and SDG 11 (Sustainable Cities and Communities).

Analysis of SDGs, Targets, and Indicators

1. Which SDGs are addressed or connected to the issues highlighted in the article?

1. SDG 7: Affordable and Clean Energy
2. SDG 8: Decent Work and Economic Growth
3. SDG 9: Industry, Innovation, and Infrastructure
4. SDG 13: Climate Action

2. What specific targets under those SDGs can be identified based on the article’s content?

1. SDG 7: Affordable and Clean Energy

   • Target 7.2: By 2030, increase substantially the share of renewable energy in the global energy mix. The article states that the “robust increase in electricity demand is progressively supported by clean energy” and highlights that “growth in generation from hydropower and renewable energy sources” is significant. It also mentions that “wind and solar energy poised for continued expansion,” directly aligning with this target.
   • Target 7.3: By 2030, double the global rate of improvement in energy efficiency. The article identifies “smart grid infrastructure” as a principal area of investment, driven by the “government’s commitment to enhancing the public electricity supply infrastructure and increasing efficiency.” This directly addresses the goal of improving energy efficiency.

2. SDG 8: Decent Work and Economic Growth

   • Target 8.4: Improve progressively, through 2030, global resource efficiency in consumption and production and endeavour to decouple economic growth from environmental degradation. The article highlights a challenge to this target by stating that “China’s electricity consumption continues to outpace its gross domestic product (GDP) growth.” However, the shift towards clean energy and away from coal represents an effort to decouple economic activity from the most severe environmental impacts of power generation.

3. SDG 9: Industry, Innovation, and Infrastructure

   • Target 9.1: Develop quality, reliable, sustainable and resilient infrastructure, including regional and transborder infrastructure, to support economic development and human well-being. The article discusses the rapid development of “EV infrastructure,” “data centres,” and “5G infrastructure,” all of which are critical components of modern, sustainable infrastructure. The investment in smart grids also contributes to creating a more reliable and resilient electricity infrastructure.
   • Target 9.4: By 2030, upgrade infrastructure and retrofit industries to make them sustainable, with increased resource-use efficiency and greater adoption of clean and environmentally sound technologies and industrial processes. The article details China’s pivot from heavy industries to high-tech sectors and its efforts to upgrade its energy infrastructure. This includes the “moratorium on the construction of new coal-based facilities,” the “initiative to curtail coal-based power generation,” and the expansion of renewable power, all of which represent a move towards cleaner technologies and more sustainable industrial processes.

4. SDG 13: Climate Action

   • Target 13.2: Integrate climate change measures into national policies, strategies and planning. The article provides clear examples of this integration, citing the “Chinese government has imposed a moratorium on the construction of new coal-based facilities in the key economic regions” and the “government’s initiative to curtail coal-based power generation.” These are direct policy actions aimed at mitigating climate change.

3. Are there any indicators mentioned or implied in the article that can be used to measure progress towards the identified targets?

1. For Target 7.2 (Increase renewable energy share):

   • Indicator: Share of renewable energy in total electricity generation. The article implies this indicator by stating that the “growth in generation from hydropower and renewable energy sources has resulted in excess generation capacity at numerous coal-fired power plants” and that “wind and solar energy poised for continued expansion.” Tracking the percentage of electricity generated from these sources would measure progress.

2. For Target 8.4 (Decouple growth from resource use):

   • Indicator: Energy intensity measured in terms of electricity consumption per unit of GDP. The article provides the data points to calculate this, noting that “electricity consumption continues to outpace its gross domestic product (GDP) growth.” It forecasts power consumption to grow at a “compound annual growth rate of 6.3% during 2024-2030,” while real GDP is set to increase from “$2,01bn in 2024 to $2,31bn in 2030.” Comparing these growth rates serves as a direct measure of energy intensity.

3. For Target 9.4 (Upgrade to sustainable industries/infrastructure):

   • Indicator: Share of different energy sources in power generation. The article implies this by stating that “coal is projected to remain the predominant source of power generation,” but that the demand for it is anticipated to decline. An indicator would be the reduction in the percentage of power generated by coal versus the increase in the percentage generated by gas, wind, and solar.

4. For Target 13.2 (Integrate climate policies):

   • Indicator: Number and scope of policies to reduce reliance on fossil fuels. The existence of the “moratorium on the construction of new coal-based facilities” and the “initiative to curtail coal-based power generation” are themselves indicators of policy integration. Progress could be measured by the number of regions covered by such policies or the targeted reduction in coal capacity.

4. Summary Table of SDGs, Targets, and Indicators

Source: power-technology.com