For comparison, the global coal fleet had grown by an average of 25GW every six months over the previous two decades, from 2000-2019.
Phasing out coal
The 2.9 gigawatt (GW) decline in the first half (H1) of 2020 takes the global total down to 2,047GW. The decline in global coal power capacity was driven primarily by the EU and UK, which saw a 8.3GW net reduction in capacity in the first half of 2020. This is the largest half-year drop on record, with only 2016 seeing a larger net reduction of 8.7GW across 12 months (see chart below).
With another 6.0GW of coal closures scheduled for the second half of this year, the EU is on course to set a clear annual retirement record for the full year of 2020.
Altogether, 19 EU countries and the UK have committed to phase out coal power generation by 2030, with Germany targeting 2038. This leaves seven member states yet to agree to a phaseout: Spain, Poland, Czechia, Romania, Bulgaria, Slovenia and Croatia.
While Spain has not yet committed to a coal phaseout, the country retired half its fleet in June 2020 (4.8 of 9.6GW), before the expiration of exemptions from EU pollution limits.
Planned new capacity
New figures show that 189.8GW of coal power capacity is still under construction globally and another 331.9GW is in planning. This runs counter to calls from UN secretary general António Guterres for a global moratorium on new coal plants after 2020.
New coal plant development in H1 2020 was predominantly concentrated in China, which has increased its coal proposals and permits, while much of the world has put coal plans on pause. Most of this activity has taken place since March, raising concerns that provinces are regarding coal plants as a form of post-covid economic stimulus to counter the financial slowdown.
These shifts mean China is for the first time now home to half the world’s operating coal fleet. Analysis by the University of Maryland warns the continuing build-out of large amounts of coal power will exacerbate China’s overcapacity crisis, lowering the average utilisation rate for its coal plants from below 50% today to below 45% by 2025, with negative consequences for profitability.
Outside China, plans for new coal development radically slowed in 2020, with fresh proposals and construction starts occurring in just seven countries. (These were India, the Philippines, Indonesia, Bangladesh, Turkey, Russia and Brazil