China's Record September Generation

China's electricity generation jumps to a September record of 802 TWh, led by a 47.8 TWh increase in thermal (coal) output

October 22, 2024 • Est. Reading Time: 3 minutes

Mobius Intel Brief:

China’s electricity generation surged to a new seasonal high in September, offering a contrasting perspective to the pervasive ‘slow Chinese economic activity’ narrative weighing on global commodity markets.

  • Key Intel: China’s total electricity output jumped to 7.61% (56.8 TWh) Y/Y to a new September record of 802 TWh. China’s coal-fired thermal generators provided the lion’s share of September’s annualized output growth, with a 47.8 TWh Y/Y increase in thermal generation offsetting a 19 TWh Y/Y decline in hydro.

Two takeaways emerge from China’s latest generation data:

  1. While the effects of China’s property sector turmoil on near-term commodity demand retains considerable uncertainty, September’s electricity generation data suggests the extent of bearish sentiment connected to China’s economic activity is likely overblown.

  2. China’s world-leading wind and solar capacity (~1,120 GW) has not reduced coal demand for power generation. Coal-fired generation remains the primary backstop resource for meeting additional load growth and overcoming generation curtailments. Replacing coal-fired generation with capacity-weighted wind and solar generation would require approximately 18.2x the capacity currently in China’s construction pipeline.

A closer look at the numbers:

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