China Cancels Two-Thirds of Planned Overseas Coal Capacity, but Private and Captive Projects Persist
Updated: 54 minutes ago
UNITED NATIONS/JAKARTA, 28 September 2026
Five years after President Xi Jinping pledged that China would stop building new coal-fired power projects overseas, a new assessment reported by the Associated Press on 26 September finds that the China-linked coal pipeline has contracted sharply while private investment and “captive” power plants serving mineral-processing complexes remain substantial gaps. The study says 67 per cent of the capacity that was planned when the pledge was made has been cancelled. Yet 3.3 gigawatts entered construction over the past year and a further 20.5 GW remains at the planning stage. Associated Press; CREA/PACS full report
The findings present a mixed record. The withdrawal of state-owned banks and enterprises from many early-stage projects has materially reduced long-term emissions risk. But new coal capacity can still advance through private ownership, engineering contracts, core-equipment supply and off-grid industrial power if those activities are treated as falling outside the pledge. The resulting dispute concerns not only climate targets but also air pollution, public health and the distribution of industrial-transition costs in host communities. CREA/PACS report page; Associated Press on Indonesia’s aluminium expansion
The pledge and the measurable progress
Addressing the United Nations General Assembly on 21 September 2021, Xi said China would increase support for green and low-carbon energy in developing countries and “will not build new coal-fired power projects abroad”. The published English text did not expressly confine the commitment to government lending or investment by state-owned enterprises. Nor did China publish, at the time, detailed implementing rules covering existing contracts, equipment supply, private companies or captive plants. Chinese Mission to the UN: 2021 statement; Reuters’ contemporaneous report
The new report was produced by the Centre for Research on Energy and Clean Air, or CREA, and People of Asia for Climate Solutions, or PACS. It classifies an overseas project as China-linked when a Chinese company is involved through ownership, finance, equity, engineering, procurement and construction, core-equipment supply, industrial-park development or the use of captive coal. Its coverage includes state-owned and private firms and relies principally on Global Energy Monitor’s July 2026 plant database, checked against planning documents, company disclosures and other public sources. CREA/PACS methodology
The authors count 129 units totalling 61.5 GW as cancelled during the five years and estimate that the cancellations avoided 6.4 billion tonnes of lifetime carbon dioxide emissions. “Avoided emissions” is a modelled counterfactual, not an observed reduction: it assumes that the plants would otherwise have been built and operated at typical utilisation rates. The report separately says that, of the 68 GW in the permitted and pre-permitted planning pool in 2021, 67 per cent has been cancelled, 7 per cent has become operational, 3 per cent is under construction and 22 per cent remains in development. CREA/PACS full report
The total of 61.5 GW cancelled and the 67 per cent share of the original 68 GW planning pool do not use the same denominator and should not be multiplied as if they were a single calculation. The first is the report’s broader cancellation tally, while the second describes changes within a defined 2021 planning pool. The AP reported the two figures together; the body of the study shows that they should be read separately. Associated Press; CREA/PACS report, pp. 8–9 and methodology
Existing contracts and genuinely new projects
The report records 36.6 GW of China-linked overseas coal capacity becoming operational after the pledge, as of July 2026. Most of those plants had already been firmly contracted or were under construction in 2021. The authors acknowledge that cancelling them could have breached existing contracts or diplomatic arrangements. It would therefore be misleading to classify all capacity commissioned after the pledge as a violation. CREA/PACS full report
The more contested category consists of projects that had not begun construction, or had not even been announced, in 2021. The report says 5.9 GW of such capacity has since become operational and 7.3 GW entered construction after the pledge. Total China-linked capacity under construction stood at 10.2 GW in July, while the permitted and pre-permitted pipeline was 20.5 GW. Although another 7.1 GW was formally or presumptively cancelled during the past year, 3.3 GW began construction and the pace of cancellation slowed from the previous year. CREA/PACS full report
This concern predates the latest assessment. Reuters reported in 2025 that a Global Energy Monitor review of ten expanded BRICS states had found substantial Chinese state-owned enterprise involvement in new coal capacity then under construction, much of it connected to Indonesia’s nickel industry. That study had a different geographical sample, definition and cut-off date, so it cannot verify the latest figures unit by unit. It does, however, independently support the longer-term pattern of projects proceeding through engineering or industrial roles after formal financing tightened. Reuters
Indonesia and the captive-coal gap
Captive plants supply a single factory, smelter or industrial park rather than selling electricity to the national grid. CREA and PACS say Indonesia contains 94 per cent of the China-linked overseas captive-coal capacity that became operational after the pledge, principally serving nickel, aluminium and other mineral processing. They record 13.2 GW of post-pledge operational captive coal, representing 60 per cent of the relevant units. About 41 per cent of coal capacity now under construction is captive, with another 4.8 GW of captive capacity still planned. CREA/PACS full report
Indonesia’s position cannot be explained by decisions in Beijing alone. Its restriction on new grid-connected coal plants preserves exceptions for national strategic projects and value-added industries, while its “downstreaming” policy has rapidly increased industrial parks’ demand for firm power. The report describes a split system: cleaner generation is added to the national grid while some large industrial developments continue to build their own fossil-fuel supply. CREA/PACS report, pp. 24–27
The AP reported on 1 September that Chinese companies were involved in about three-quarters of Indonesia’s planned aluminium projects. Indonesia seeks greater domestic processing, employment and export value from its minerals, and disruption to global aluminium supplies during the Iran war strengthened the commercial case for rapid expansion. Muhammad Al Amin of the Indonesian Forum for Environment told the AP that additional captive coal for aluminium could worsen toxic haze and that communities had already experienced adverse effects. That is an environmental group’s account; the public record does not permit every reported health harm to be attributed to a particular China-linked plant. Associated Press: Indonesia’s aluminium expansion
The clean-energy expansion is also substantial
The report does not describe overseas engagement as uniformly coal-based. It estimates that 69.4 GW of China-linked renewable projects was operational overseas by July 2026, with 100.5 GW under construction and 280.8 GW at pre-construction stage. Its modelling puts the lifetime emissions avoided by operating projects at about 1.9 billion tonnes of CO₂; completion of all projects now under construction could add about 3.3 billion tonnes in potential avoided emissions. CREA/PACS full report
The figures show how Chinese solar, wind, hydropower, storage and other low-carbon technologies are widening the options available to developing economies. They also require caution. A pre-construction project is not a completed plant, and the rated capacity of coal and diverse renewable technologies cannot be compared on a simple one-for-one basis. The report says planned projects still require permits, finance or final investment decisions; 89.2 GW is classified as “integrated energy” whose underlying technology could not be fully identified and was excluded from generation and avoided-emissions estimates. CREA/PACS methodology
The International Energy Agency’s June outlook says Southeast Asian energy demand is growing rapidly and that the Middle East conflict has pushed energy security higher up the policy agenda. The AP, citing the IEA, reported that the region will account for nearly 20 per cent of growth in global energy demand through 2035. Short-term supply shocks may encourage governments to burn more coal, but they also reveal the risks of dependence on imported oil and gas and strengthen the security case for domestic renewables, grids and storage. IEA Southeast Asia Energy Outlook 2026; Associated Press
Responses from China and host authorities
No itemised Chinese government response to this week’s CREA/PACS report could be found. Addressing the General Assembly on 26 September, Vice-President Han Zheng said energy transition should remain a global development priority, called for more support for the Global South and urged developed countries to honour climate-finance commitments. At a Global Development Initiative event, he said China would expand co-operation in new energy and pursue more robust, greener and healthier global development. Those statements set out China’s general position, but did not say whether the 2021 coal pledge covers private firms, captive plants, engineering contracts or equipment supply. Chinese Foreign Ministry: Han’s General Assembly statement; Chinese Foreign Ministry: Global Development Initiative remarks
Indonesia is likewise emphasising industrial development, energy independence and clean power at the same time. Its Ministry of Energy and Mineral Resources said in September that nickel, bauxite, silica and copper could support domestic solar-panel, battery and other clean-technology industries. A separate programme is intended to begin with 17 GW of solar supported by about 33 GW of storage. No direct Indonesian government response to the figures in this week’s report was found in the English-language public material reviewed. Indonesian Ministry of Energy and Mineral Resources: clean-energy industry; Indonesian Ministry: 100 GW solar programme
Li Shuo, director of the Asia Society Policy Institute’s China Climate Hub, told the AP that the transition was a “two-party tango” requiring China and its partners. The evidence supports that allocation of responsibility: Chinese actors provide capital, equipment and engineering capacity, while host governments determine industrial policy, permits, grid planning and fuel choices. Blaming every new plant directly on the Chinese state, or excluding every private project from a national pledge, would each oversimplify the chain of decisions. Associated Press
Human and public-interest consequences
The immediate public-interest issues surrounding captive coal extend beyond global carbon emissions. Residents near industrial parks may face risks associated with fine particulates, sulphur and nitrogen oxides, ash, water use and land conversion; jobs, tax receipts and mineral-processing income can simultaneously increase official support for projects. Determining whether any specific project violates human rights would require plant-level emissions, health, environmental-assessment, land, labour and grievance records that are not supplied by a global project database. Associated Press: community account; CREA/PACS full report
What can be established is that policy definitions determine who carries the risk. If the overseas-coal pledge covers all China-linked ownership, finance, contracting and core-equipment activity, oversight extends to private enterprises and overseas subsidiaries. If it covers only state finance, industrial projects can continue to develop coal generation with commercial capital. CREA and PACS recommend a designated senior co-ordinating body, plant-level disclosure, express inclusion of captive coal, and early-retirement or renewable-replacement plans developed with host states. These are the organisations’ policy proposals, not decisions accepted by China or its partners. CREA/PACS recommendations
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