China Achieves Significant CO₂ Emissions Reduction with Renewable Energy Boom in 2025

In the first quarter of 2025, China achieved a 1.6% reduction in carbon dioxide (CO₂) emissions compared to the same period in 2024, even as national electricity demand increased by 2.5%. This decline marks a significant milestone in the country's ongoing efforts to transition toward cleaner energy sources.

The reduction in emissions is primarily attributed to substantial growth in renewable energy generation. During this period, China generated over 951 terawatt-hours (TWh) of clean electricity, a 19% increase from the first quarter of 2024. This surge in clean energy output elevated its share of the nation's power generation mix to a record 39%, up from 34% the previous year.

Wind power led the clean energy mix, producing 307 TWh and accounting for 13% of total generation. Solar power experienced the fastest growth, expanding by 48% to 254 TWh and contributing 10% to the overall mix. Notably, for the first time, combined wind and solar generation surpassed hydroelectric output, which increased by 7% to 226 TWh. Nuclear power also saw a 13% rise, reaching 117 TWh.

This expansion in renewable energy allowed for a reduction in fossil fuel-based generation. Coal-fired power output decreased by 4% to 1,421 TWh, reducing coal's share in the generation mix to 58% from 63% the previous year. Natural gas-fired output also declined by 4% to 67 TWh.

The Centre for Research on Energy and Clean Air (CREA) noted that the growth in clean power generation has now overtaken both current and historical averages in electricity demand, leading to a reduction in fossil fuel use. This trend suggests that China's strategic investments in renewable energy are beginning to yield substantial environmental benefits.

In July 2025, China introduced its first renewable energy mandates for the steel, cement, and polysilicon industries, as well as for newly constructed data centers in key hub locations. The National Development and Reform Commission (NDRC) released Renewable Portfolio Standards (RPS) that dictate the minimum percentage of energy consumption that must be sourced from renewables across various provinces. For instance, new data centers are required to use at least 80% renewable electricity. These targets vary by region, with hydropower-rich Yunnan province facing a 70% renewable target in 2025, while mountainous Chongqing is set at 10.8%.

China's leadership in renewable energy development is further underscored by its construction of 74% of all solar and wind power projects currently underway worldwide, amounting to 510 gigawatts (GW) out of a total 689 GW. This aggressive expansion highlights China's commitment to clean energy and its role in global efforts to combat climate change.

Despite these advancements, challenges remain. The rapid expansion of renewable energy has led to oversupply and sharp price declines in the solar industry, with certain components dropping nearly 30% from May 2024 to May 2025. In response, the Chinese government has pledged to reduce price wars and eliminate outdated capacity, resulting in significant stock gains for major solar companies.

Furthermore, while renewable energy capacity has increased, integrating these sources into the national grid presents technical challenges. The variability of wind and solar power requires advancements in grid infrastructure and energy storage solutions to ensure a stable and reliable power supply.

China's recent reduction in CO₂ emissions, despite rising electricity demand, underscores the significant impact of its investments in renewable energy. This development not only contributes to global climate change mitigation but also highlights the potential for economic growth through sustainable energy practices.