China Is on Its Way to Becoming World’s First ‘Electrostate’
- China leads the world in electrification, with a 30% electrification rate—far ahead of the U.S. and EU at ~22%—dominating sectors like transport and industry.
- Massive investment in electric vehicles, high-speed rail, and renewables has positioned China as a superpower in clean energy technologies, with renewables now making up 10% of GDP.
- Despite progress, China’s ongoing coal expansion complicates climate goals, as the country remains the largest greenhouse gas emitter, raising doubts about its transition timeline.
Many people are perhaps familiar with the term “petrostates”, which usually denotes oil-rich nations that are deeply intertwined with the oil industry, often facing economic and political challenges due to oil price fluctuations and the potential decline in hydrocarbon resources. Saudi Arabia, Iraq, the United Arab Emirates (UAE), Kuwait, and Iran are some of the world’s leading petrostates. But with the world’s electrification drive now in full gear, scientists have coined the term “electrostates” to refer to countries that have made the most progress transitioning away from processes and technologies that rely on fossil fuels to electrically powered alternatives.
According to the International Energy Agency (IEA), electrification is “one of the most important strategies for reducing carbon emissions from energy.” And, as in many other scientific arenas, China has emerged as the nation that is leading the electrification race, ahead of the United States and Europe.
According to a study, China’s electrification rate has hit 30%, significantly ahead of the U.S. and the EU and US where the electrification rate has plateaued at ~22% in recent years.
The study defines the electrification rate as the share of electricity in final energy consumption versus energy coming from fossil fuels. According to the study, the U.S. still leads the world in the electrification of buildings; however, China recently caught up to the U.S. and Europe in industrial electrification, and has overtaken both in the electrification of transport. In 2024, electric vehicles (EVs) made up approximately 47.9% of the total passenger car sales in China, a huge increase from 2020, when plug-in EVs accounted for just 6.3% of total sales. In comparison, electric vehicles accounted for less than 23% of new car sales in Europe over the timeframe.
The rapid expansion of China’s modern rail network has also helped supercharge the electrification of the country's transport sector. China boasts a 45,000 km high-speed rail network, five times the size of the EU’s. That figure is expected to expand to 60,000km by 2030.
Source: Climate Energy Finance
China’s President Xi Jinping has been largely credited with the country’s remarkable electrification journey. When Xi became the leader of the Chinese Communist Party in 2012,
China had emerged as the world’s second-largest economy and the United States’ archrival nuclear power. However, the country was still highly dependent on other countries for its energy needs. China’s oil and coal imports were surging to record highs, exposing the country to potential supply disruptions amid growing geopolitical tensions.
Fast forward to the present, and China is not only rapidly advancing towards energy security but also controls the critical minerals that underpin technologies of the future.
“Nobody had been seriously worrying about energy security or supply chains for armaments and critical industries and food because everyone thought that went with the Cold War,”
says Andrew Gilholm, head of China analysis at consultancy Control Risks. “Meanwhile, China has been working on that for years.”
China now leads the 4th Industrial Revolution, making huge strides in electrification, renewable energy, artificial intelligence (AI), robotics and the Internet of Things. And, just as oil and gas drive the petrostates of the Arab world, clean energy technologies are powering China’s growth.
To wit, renewable energy accounted for a record 10% of China’s GDP in 2024, driving a quarter of economic expansion, the Centre for Research on Energy and Clean Air (CREA) has revealed.
Beyond energy security and economic growth electrification is expected to play a critical role in addressing climate change.
“We cannot see any way to a zero-carbon economy except through massive electrification,”
Lord Adair Turner, head of the Energy Transitions Commission, said.
This is particularly critical for China, which remains the world’s biggest polluter and emitter of greenhouse gases. China’s power sector emissions hit record highs last year, driven by a surge in coal consumption. However, the country’s progress in electrification and the transition to renewable energy will be able to mitigate some of the damage.
Coal remains a controversial topic in China, with Beijing indicating it will start phasing down coal consumption between 2006 and 2030. Whereas this suggests a gradual decline rather than a complete and immediate phase-out, the IEA predicts that coal generation in China will likely peak around 2025 and decline thereafter. However, recent reports indicate that China is still building new coal plants, which raises questions about the commitment to phasing down coal use: Reuters has reported that China plans to keep building coal-fired power plants through 2030.
By Alex Kimani for Oilprice.com
