China invests more in wind and solar than coal overseas for the first time

China’s overseas investment in renewable energy has, for the first time, surpassed coal, marking a significant shift in the country's global energy strategy, according to new data from Boston University.

A new analysis from Boston University’s Global Development Policy Center shows that China directed 68% of its overseas power investments toward wind and solar energy projects from 2022 to 2023. This marks the first time since the early 2000s that Beijing has invested more in renewables than in fossil fuels abroad.

Historically, China’s Belt and Road Initiative (BRI) has been heavily criticized for funding coal power in developing countries. From 2000 to 2021, just 13% of China’s overseas energy investments supported wind and solar. But under mounting international pressure and a 2021 pledge by President Xi Jinping to stop financing new coal plants abroad, the investment landscape has shifted.

While no new state-backed coal projects were launched after the 2021 pledge, previously approved plants are still coming online. If completed, these projects could emit as much carbon dioxide annually as Austria, according to the analysis.

Despite the renewable energy shift, the scale remains modest. Between 2022 and 2023, only 3 gigawatts of solar and wind capacity were added—far below the 16-gigawatt annual average of Chinese overseas power investments between 2013 and 2019, when coal dominated.

Most of the recent renewable investments were in Asia and the Americas, with only 4% directed toward Africa. However, during a 2024 China-Africa forum, Beijing committed $51 billion to build 30 low-carbon energy projects in Africa over three years.

China’s pivot to renewables overseas is partly driven by economic necessity, analysts say. With a sluggish domestic economy and surplus clean energy technology, China is seeking new markets abroad. "They need to export, they don’t have any choice," said Alicia Garcia Herrero, chief economist for Asia Pacific at Natixis.

Domestically, China continues to lead in new coal plant construction, beginning work on 94 gigawatts of coal-fired capacity in 2023—over twelve times the rest of the world’s total. Still, Beijing is trying to position itself as a climate leader, emphasizing its dominance in renewable energy technology and supply chains.

While U.S. President Donald Trump has reversed America’s participation in the Paris Agreement and increased fossil fuel production, the U.S. International Development Finance Corp. continues to support global infrastructure and critical mineral investments. The agency is seen as Washington’s counter to China’s Belt and Road Initiative, though its focus diverges sharply on climate policy.

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