China’s Overseas Energy Investments Shift Toward Renewables, Marking a Climate Milestone
Published: May 31, 2025
China has, for the first time, invested more in solar and wind energy projects overseas than in coal, marking a significant shift in global energy financing. According to a recent policy brief from the Global Development Policy Center at Boston University, nearly 70% of China’s foreign power investments between 2022 and 2023 were directed toward renewable energy sources, surpassing fossil fuels for the first time since the early 2000s.
A Turning Point in China’s Global Energy Footprint
The change follows Chinese President Xi Jinping’s 2021 pledge to halt financing for new coal-fired power plants abroad. Instead, China vowed to support green energy infrastructure in developing countries — a move widely seen as a response to global pressure for more climate-responsible policies.
“This announcement marked an important shift in China’s global energy policy,” the report states, “with the potential to fill the glaring gaps in financing necessary for the energy transition in developing countries.”
The updated China Global Power Database, also maintained by BU’s GDP Center, shows that no new coal plant investments have been recorded since the 2021 pledge. However, previously approved coal projects are still coming online, and they’re expected to emit as much carbon annually as the entire country of Austria.
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Progress with Caveats
While the headline shift toward renewables is significant, the full picture is more complex. The total scale of China’s overseas energy investments has actually declined since peaking in 2016. Just 3 gigawatts (GW) of wind and solar capacity were funded in 2022–2023, far below the 16 GW annual average from 2013 to 2019.
“This shift does not represent a major ramp-up in renewables, as the scale of financing remains relatively small,” the report cautions.
Moreover, much of China’s overseas energy portfolio is still heavily carbon-intensive, as many fossil fuel projects remain operational or are nearing completion.
What’s Next? Early Signs from 2024 and Beyond
Although comprehensive data for 2024–2025 is not yet available, early indicators suggest that China is continuing its pivot toward clean energy investments abroad.
At the 2023 Belt and Road Forum, China launched the Green Investment and Finance Partnership (GIFP), aiming to embed sustainability into the financial framework of Belt and Road projects. Several pilot renewable energy initiatives have since emerged, particularly in Africa and Southeast Asia.
Additionally, Chinese state-owned companies have signaled a retreat from overseas coal ventures. For example, State Power Investment Corporation has expanded its renewable operations in Vietnam and Chile, while other firms are scaling solar and wind exports through strategic infrastructure investments.
Media outlets such as Bloomberg and China Dialogue have reported a sharp rise in China’s exports of solar components and wind turbine blades in 2024, which may signal a growing emphasis on not just domestic, but international decarbonization.
While official figures are pending, the trajectory appears clear: China is deepening its role as a global supplier and financer of renewable energy — not only as a policy direction but as a long-term geopolitical strategy.
New Insights from China’s Power Investment Data (2000–2023)
Additional context comes from a 2024 video briefing by Boston University’s Global Development Policy Center, which manages the China’s Global Power Database. The presentation provides deeper insight into recent investment shifts and long-term trends.
A 2024 video briefing by Boston University’s Global Development Policy Center, which manages the China’s Global Power Database, offers deeper insight into these trends. The data now includes over 1,600 power projects and shows a consistent decline in fossil fuel investments since 2017.
In particular, the update highlights that some overseas coal projects — including those in Bangladesh and Cambodia — have been cancelled or replaced by renewables, reflecting growing pressure to align with global climate commitments.
The video also underscores the strategic role of the Green Investment and Finance Partnership (GIFP), which goes beyond funding: it promotes transparency, accountability, and standardization in sustainable energy financing abroad.
Global Implications and the Road Ahead
Despite ongoing challenges and legacy emissions from earlier projects, China’s overseas energy finance is increasingly aligned with global climate goals. For developing countries facing limited access to clean energy capital, this shift could be a game-changer — if the trend continues and scales up.
Initiatives like GIFP are now closely watched by both policymakers and sustainability advocates, as they could play a crucial role in bridging the climate finance gap in the Global South.
FAQ – Frequently Asked Questions
Why is China investing more in renewable energy overseas?
China is shifting its overseas energy investments to renewables like solar and wind as part of its 2021 pledge to stop funding new coal plants abroad. This aligns with global climate goals and helps strengthen China’s leadership in green technology markets.
Does this mean China has completely stopped financing coal projects?
Not entirely. While no new coal investments have been approved since 2021, several previously announced coal projects are still being completed. These existing plants will continue to emit carbon for decades unless retired early.
What is the Green Investment and Finance Partnership (GIFP)?
The GIFP is a green finance initiative launched by China during the 2023 Belt and Road Forum. It aims to support renewable energy and sustainable infrastructure in developing countries through cleaner investment practices.
Source list
Boston University Global Development Policy Center. (n.d.). China’s Global Energy Finance Database. Retrieved May 31, 2025, from https://www.bu.edu/gdp/chinas-global-energy-finance
Jaynes, C. H. (2025, May 28). China Invests More in Solar and Wind Than Coal Overseas for the First Time. Ecowatch. Retrieved from https://www.ecowatch.com/china-solar-wind-coal-overseas-investment.html
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Content developed using AI technology, with final review and refinement by our human editors to ensure clarity, coherence, and accuracy.
