Coal production in China is expected to drop to 3.4 billion tonne (Bt) in 2020, while consumption is also projected to fall to 3.42Bt, says a Timetric report.

Titled ‘Coal mining in China to 2020‘, the report attributes the declining fortune of the once strong coal industry to renewable energy alternatives which are currently being pushed. The move was part of a drive to improve air quality and promote renewable energy. Production shrunk by 2.7% in 2014 due to the closure of an estimated 2,000 small-scale mines with a total capacity of 117.5Mt, as a result.

"Chinese coal consumption witnessed a 3.5% decline in 2014, while the same trend is expected to continue."

Chinese coal consumption witnessed a 3.5% decline in 2014, while the same trend is expected to continue. The consumption was primarily affected by the use of renewable sources in the power generation sector, including hydropower, nuclear power, wind power and natural gas. However, it continued to be led by the power generation sector (67.8%) followed by the industrial sector (19.9%).

China’s coal imports are expected to remain largely unchanged with volumes of 224.9Mt in 2020 compared to its status as the world’s leading importer in 2014 at 226.8Mt. The Chinese authorities initiated the closure of domestic coal-fired power plants in 2014 resulting in a significant decline of 15% in Chinese imports in 2014.

The report further highlights that even though it appears that the sun has set on the Chinese coal industry, the country will remain one of the top coal consumers in 2020. Alternate renewable sources will eat into the share of coal in power generation with coal’s total estimated installed capacity expected to slightly decrease to 62% by 2020 from the current 64.4%.

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China is among the top three countries in terms of coal reserves, accounting for 12.8% of the global total with proven coal reserves of 114.5Bt at the end of 2014. The key coal-rich regions are spread across Shanxi and Inner Mongolia.