China Coal: The Challenge of Regulation and Market Reform

China’s major generation companies enjoyed increasing profitability annually from 2012 through the first half of 2015. 

The picture is not all rosy, however.  Demand growth has slowed, with limited prospect of a return to past extraordinary growth rates. Frequent major shifts in regulations, often without much consultation or transition, pose new challenges to the industry’s operational and financial performance.  Most of these shifts involve tightened environmental compliance requirements.  Additional uncertainties surround the prospect, nature, and extent of China’s power industry reform efforts.

In this issue of TLG on China, we review the impact of recent developments in China’s power market and environmental regulations from the perspective of the coal-based generation sector.