China’s Power Surge: Inside the World’s Most Ambitious Energy Expansion

• China is undertaking the world’s largest-ever energy expansion to secure power for future-defining industries.

• In 2024 alone, it added 543 GW of capacity, exceeding India’s total system and outpacing the US.

• The strategy prioritizes energy security, lower import dependence, and competitive electricity prices.

• Growth spans solar, wind, coal, nuclear, and hydropower.

• Grid efficiency and market reforms are emerging as the next policy focus.

China is in the midst of an unprecedented expansion of its energy system, scaling up power generation at a pace that has no modern parallel. The push reflects Beijing’s determination to guarantee reliable electricity for industries that will shape future economic leadership, particularly as global competition intensifies around technology and manufacturing.

Data released Wednesday by the National Energy Administration show that China brought 543 gigawatts of new power capacity online last year across all energy sources. That single-year increase exceeded the total installed power capacity of India at the end of 2024 by roughly 12%. Taken together, the electricity China has added since late 2021 now surpasses the entire power system of the United States. President Xi Jinping’s strategy centers on three goals: securing dependable energy supplies, reducing exposure to imported fuels, and giving fast-growing sectors — including artificial intelligence, robotics, and advanced materials — access to plentiful and affordable electricity. Those ambitions come as concerns grow that similar industries in the US could be constrained by tight power markets and high costs.

“The pace of construction remains extraordinary, with record-breaking additions year after year,” said Michal Meidan, head of China energy research at the Oxford Institute for Energy Studies. “Energy security is the top priority, but equally important is ensuring that power remains competitively priced.”

The buildout spans nearly every form of generation. Solar power made up more than half of last year’s new capacity, while additions of wind farms and fossil-fueled plants — particularly coal and natural gas — also hit historic highs, according to the NEA. Nuclear and hydropower growth was more modest in 2024, though both are expected to take on a much larger role over time.

China already has the world’s largest slate of nuclear reactors under construction and is moving ahead with an enormous hydropower project in Tibet that is set to become the biggest power station on the planet. Construction on the $167 billion facility officially began in July. By contrast, capacity growth in the US slowed sharply after electricity demand flattened decades ago. Now, the rapid rise of data centers and AI-related infrastructure has pushed American power markets to their limits. “The US is struggling to keep up with demand from energy-intensive digital industries,” said Samantha Dart, co-head of global commodities research at Goldman Sachs Group Inc.

“The US could run into serious bottlenecks, while China appears largely unconstrained,” Dart added. “Over time, that imbalance could shift leadership in the AI race.”

Although China has steadily expanded its electricity system since industrialization accelerated in the 1990s, the current surge can be traced back to power shortages that disrupted factories and households in 2021 and 2022. Since 2023, annual capacity additions have averaged more than 400 gigawatts — nearly three times the pace of the previous six years.

The scale of the expansion is now forcing policymakers to confront new challenges. Rapid growth in wind and solar has occasionally overwhelmed local grids, resulting in small but rising levels of curtailed generation. At the same time, coal plants continue to be built even as cleaner energy reduces how often they are used. “Coal units are rarely retired, utilization rates keep falling, yet new plants are still being added,” said Belinda Schäpe, a China policy analyst at the Centre for Research on Energy and Clean Air. “The situation is becoming increasingly absurd.”

Another complication is that headline capacity figures can be misleading. While a one-gigawatt solar project and a one-gigawatt nuclear reactor may appear equivalent, the nuclear plant will generate far more electricity over an entire year due to higher utilization rates.

Recent policy signals suggest that China’s focus may now be shifting from sheer expansion to efficiency. If the past few years were about building at scale, the next phase is likely to emphasize grid upgrades and market reforms to ensure new capacity is fully used. Rules introduced in June reduced power prices for wind and solar producers, a move BloombergNEF expects will slow the pace of new renewable installations.

Even so, as Beijing prepares to unveil its economic roadmap for the 15th Five-Year Plan, covering the period through 2030, officials appear unwilling to ease off too sharply. Energy security remains non-negotiable.

“Energy has to underpin industrial innovation, modernization, and technological progress,” Meidan said. “That principle sits at the heart of China’s economic strategy for the next five-year plan.”