SESUK

China's thermal (coal and gas) power generation fell 7% on year in June, accelerating from a 4% drop in May. Solar power continued to deliver most of power generation growth, and the recovery of hydropower from earlier droughts helped push fossil fuels down sharply. Industrial emissions likely fell too, with cement production down 11% and iron production 3%. Steel products output grew 3%, showing that there was progress in increasing the share of recycled steel. Crude oil processing volumes, an indicator of oil products consumption, also fell 4%. The production of electric vehicles grew 37% while overall vehicle production was almost flat, raising the share of EVs to 39% of all vehicles produced. Total energy consumption grew about 4.2% in the second quarter, while GDP grew 4.7%. The pattern of energy-intensive growth continues, with only a very modest drop in the energy intensity of GDP. I will have a detailed analysis of the changes in emissions and power generation in a few weeks when the data is available, but it seems clear that the clean energy boom is finally bending China's emissions path.