Renewables growth in China and normalising normalisation
By Avi Jakhmola
The growth of renewable power in China seems to have a special place in the hall of fame for the global transition to fossil-free energy. Ever so often, there comes a new publication on how the gigawatts of renewables being added to the Chinese energy system dwarf what happens anywhere else. However, most of these articles seem to gloss over one important fact – China is… BIG!
For example, this excellent graphic from CarbonBrief (Figure 1) emphasises how China’s wind and solar additions in 2022 will be bigger than the entire installed capacities of any other country barring China itself and the US.
Figure 1. Chinese wind and solar capacity additions in 2022 compared against the 2021 cumulative installed capacities for the world’s ten leading countries. Source: Twitter (@DrSimEvans)
The absolute scale of renewables growth in China is indeed incredible, but how useful is this fact without considering the size of the country? China is home to 1 in every 5 humans on the planet. It is the world’s largest producer of electricity and its second-largest economy. Is it possible that the large use of renewables in China is mostly a reflection of its enormous size?
A more nuanced way of making inter-country comparisons is normalising renewables growth to the size of the country using its population or annual power production. For any given set of countries, this allows us to better understand both, the degree to which renewables have penetrated into their respective systems, and how far along their energy transitions are.
For instance, if we take the same data and countries as in the CarbonBrief graphic, and normalise capacity installations to the countries’ respective populations we see a very different picture (Figure 2).
Figure 2. National solar and wind installed capacities normalised to their population in 2021. Data: IRENA, UN-DESA
First, China drops from #1 to #8 as Germany climbs to the top spot with other OECD countries in tow. This figure tells us something we already know – given the disparities in their respective populations, richer, more developed economies are further along in terms of renewables deployment compared to middle-income countries like China, India and Brazil. However, a more unconventional insight is the gap between China on one hand, and Brazil & India on the other – while China is closing the gap on high-income France, its other two non-OECD peers lag far behind. It is especially remarkable that China adds about 1.7 times more renewables capacity per capita in a single year than what India - the world’s second most populous country - has cumulatively!
Next, we take what all of this solar and wind capacity is being installed for – electricity generation – and normalise it to the countries’ total annual electricity production in 2021 (Figure 3).
Figure 3. National solar and wind power generation normalised to the total annual electricity generation in 2021. Data: IEA
Here, Spain jumps ahead of Germany to claim the #1 spot and while China’s position still falls, we see it finish above both France and Japan and only slightly behind the US, signalling how quickly it’s gaining ground on other OECD countries. In a surprising development, Brazil outshines China and finishes even higher above the US to emerge as the non-OECD star. On the other end, India marginally trails Japan and finishes last once again, although with a smaller gap. This is because despite their large populations, Brazil and India produce significantly less electricity per capita compared to large OECD countries and China. Once again, China’s annual capacity additions don’t look as sensational when viewed in the backdrop of its huge electricity system.
For a more accurate comparison across countries, rapidly growing technologies such as wind and solar power should be analysed over time rather than as snapshots. In particular, there are natural differences between technology front-runners (such as Germany) and later-adopters such as China and India. As time goes by, the latter might catch up with and overtake the former. Maybe our analysis does China a disservice by comparing it against rich early-adopters that enjoy an advantage of at least a decade over it. Let’s dig deeper and see how the change in the share of wind and solar power compares between Germany and China while controlling for the time-lag between earlier and later introduction of these technologies (Figure 4).
Figure 4. Time-shifted comparisons between the growth in the share of solar and wind power as a percentage of the total annual electricity generation in China and Germany. Data: IEA
A useful observation is that Germany produced 1.5% of its electricity from renewables already in 2000, while China reached this level only in 2011. Therefore, one can say that China lags 11 years behind Germany in the uptake of renewables. To reflect this fact in the figure above, I shift the time series for Germany by 11 years so that we can compare the changing shares with respect to the same starting point. We can see that China closely trails Germany except during the latter’s 2008-2010 slowdown around the time of the financial crisis. We are yet to see whether China will undergo an acceleration similar to Germany’s 2016-2019 spur.
The figure also shows that if China implements its official target of 1200 GW by 2030 it will be quite significantly below the level where Germany was 11 years earlier (in 2019) — 22% versus 30% — and thus the gap between the two countries will increase rather than decrease. There are arguments that this target is insufficiently ambitious and that rapid decreases in the costs of renewables may shape a scenario where China somewhat narrows the time-lag by generating almost 40% of electricity from wind and solar by 2030.
This analysis yields two insights. On one hand, the rapid growth of renewables in middle-income China is simply remarkable with speeds similar to an early-adopting developed economy like Germany. On the other, for all its growth dynamism the speed of Chinese renewables expansion so far is not significantly faster than what’s been achieved in Germany.
In closing, while the data does point towards major shifts happening in the global renewables landscape, how we measure them has major implications for the conclusions we draw. Developing giants like Brazil, India, and particularly China, are deploying increasing amounts of solar and wind and starting to catch up with penetration levels and deployment rates seen in richer early-adopters from the OECD. However, given the disparities in the size, scale, and contexts of different national systems, looking at raw capacity data conceals many important insights. In a heterogenous world with calls for more urgent climate action, normalisation allows for a more nuanced view of change, and helps contextualise progress and set more realistic expectations. Read more about the race between early-adopters and followers in renewable power technologies in our group’s recent article.
