In the next two decades, China could invest more than $3.9 trillion in power sector and open 88GW power plants every year with total generating capacity of over 1,500GW.
By 2027, China could witness decline in its total power sector emissions.
BNEF China research head and country manager Jun Ying said China has started to change course towards a cleaner future.
"But despite significant progress in renewable energy deployment, coal looks set to remain dominant to 2030. More support for renewable energy, natural gas and energy efficiency will be needed if China wants to reduce its reliance on coal more quickly," Ying added.
BNEF’s analysis of power sector in China was based on four scenarios – new normal, traditional territory, barrier busting and barrier busting with carbon price.
BNEF Asia Pacific head Milo Sjardin said the wide range of outcomes in their scenarios demonstrate the extreme uncertainty facing China’s energy sector.
"The future depends on a number of big questions, questions on which one can still only speculate: the cost at which China may be able to extract its shale gas reserves, the potential impact on fracking and thermal generation of water constraints; and potential accelerations in climate and environmental policy, including a potential price on carbon," Sjardin added.
BNEF CEO Michael Liebreich said it is hard to underestimate the significance of China’s energy consumption growth and its evolving generation mix.
"The impacts will reach far beyond China and have major implications for the rest of the world, ranging from coal and gas prices to the cost and market size for renewable energy technologies – not to mention the health of the planet’s environment," Liebreich added.
