China Sends Important Signal with Expansion of Coal Mining

China continues to rely on coal-fired power, at least that is how the new investment in new coal mines in the Shaanxi region and Inner Mongolia can be explained. A total of three new projects, two in Shanxi and one in Inner Mongolia, are to be launched, producing a total of 19 million tons of coal per year.

While the Western world is against coal power, China is still openly opposed to coal power. This could be mainly due to the lack of reliable alternatives, on the other hand, they do not want to rely too much on imports from Indonesia and Australia. Imports from Indonesia, the world’s largest exporter of coal, came to a halt this year after the Indonesian government imposed an export ban on coal. Local miners had violated laws to supply their mandatory share to local power producers. In Indonesia, miners are required to sell 25% of their output to local power producers for a fixed price of $70 per ton.

It is clear that China’s economic goals are not possible without energy. Therefore, this move comes as less of a surprise. In terms of climate targets, the Chinese government remains focused on its goals of maximizing CO2 emissions by 2025 and being completely CO2 neutral by 2060.

The three new projects are expected to require an investment of 24.1 billion yuan ($3.8 billion).

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