For the first time in its recent history, China has recorded a decline in CO2 emissions even as energy demand has continued to rise. This is a shift we might describe as epoch-making: in the country that tops the global rankings for climate-altering emissions, clean energy has begun to cover all or most of the growth in consumption. Not as a result of an economic crisis, nor of pandemic lockdowns as in the past. But because China's energy system is genuinely changing. It is in transition.

This is a development that has sparked debate in online communities and climate circles, yet deserves far greater attention beyond specialist networks. It marks a turning point: this is not merely a technological evolution, but confirmation that the energy transition is under way and its centre of gravity is shifting.

Moreover, China is also subsidising the transition abroad: through the Belt and Road Initiative (BRI) development plan, long derided for its high climate impact, renewable wind and solar projects have clearly dominated for the first time. Nevertheless, coal-fired power plants financed in previous years continue to come online.

China's acceleration: record-breaking solar, expanding wind

According to a recent analysis published by Carbon Brief, in the first quarter of 2025 China's CO2 emissions fell by 1.6 per cent compared with the same period the previous year, and by 1 per cent over the preceding twelve months. But what matters most is not so much the scale of the decline as its origin: for the first time, emissions are falling not because of an economic recession or a pandemic, but thanks to the growth of renewable energy.

Over the past twelve months, generation from clean sources (solar and wind) and low-emission sources (nuclear) has covered all new energy demand, making any increase in fossil fuel production unnecessary (while hydroelectric output remained stable). The reduction in China's CO2 emissions in the first quarter of 2025 is attributable to a 5.8 per cent fall in the energy sector. While overall electricity demand grew by 2.5 per cent, thermal power generation — primarily coal and gas — fell by 4.7 per cent. In other words: China produced more energy, but did so without burning additional coal. In particular, the average amount of coal required to generate each unit of electricity at coal-fired power plants fell by 0.9 per cent year on year — a result that would have been unthinkable just a few years ago.

The figures speak for themselves. In the first three months of 2025, China installed 36 gigawatts (GW) of rooftop photovoltaic capacity. For comparison: in Italy, at the end of 2024, total installed capacity — including both ground-mounted and rooftop systems — stood at around 37 GW. In a single quarter, and with residential solar alone, China achieved what Italy (bearing in mind the very different scale) accomplished in twenty years. And if total solar is taken into account, the figure rises to 60 GW in three months.

At the same time, wind power generation recorded a significant leap: the overtaking of fossil fuels by renewables is now evident in quarterly data, and according to Carbon Brief analysts the trend will continue throughout 2025. China's CO2 emissions may be approaching not just a historical peak, but potentially the opening of a period of structural decline.

China is also financing the transition abroad

Carbon Brief's analysis was welcomed with enthusiasm in climate circles, but outside these "bubbles" the news went almost unnoticed. And yet, as journalist Ferdinando Cotugno writes in his newsletter Areale, this "is truly the most important trace of the future we have and allows us to remember that the energy transition is happening." Because this is a structural transformation increasingly grounded in policy choices and strategic investment.

Of course, China has been pressing hard on the renewables accelerator for some time, well before the trade escalation with the United States. However, the trade war triggered by Washington has reinforced this tendency: the tariffs and restrictions imposed have pushed Beijing to consolidate its energy autonomy strategy, leaning even more heavily on domestic sources to reduce dependence on fossil fuel imports. In the near future, this dynamic could accelerate further, leading China to strengthen its industrial leadership in green energy technologies and extend its influence in global renewables markets.

Through the Belt and Road Initiative (BRI), the sweeping infrastructure project through which China extends its economic influence around the world, Beijing is exporting the energy transition well beyond its own borders. In recent years, the BRI strategy has shifted its focus from investments in oil and coal towards wind and solar installations in partner countries. From 2022 to 2023, 68 per cent of China's overseas energy investments were directed towards renewable energy projects, according to a recent analysis by the Global Development Policy Center at Boston University.

This figure represents a turning point that distinguishes the current phase of Chinese policy from that of previous years. Whereas the BRI was once synonymous with new coal-fired power plants built in developing countries, China is now financing and constructing more wind and solar installations than the United States and Europe combined. This is happening in the Balkans, in Africa, in Southeast Asia: the global energy transition is advancing also because China is physically building it beyond its own borders. This aspect remains consistently undervalued in Western debates, where attention tends to focus on the domestic emissions of the Asian giant.

A transition built on poorly paid labour?

But the speed and effectiveness of China's transition also raise ethical questions. Part of the success of the renewables sector in China — particularly in the production of solar panels and batteries — is due to highly competitive production costs, partly linked to lower wages compared with Western countries. Oversimplified readings must nonetheless be avoided: in recent decades China has made enormous progress in reducing poverty, and today much of the population has access to rising levels of consumption and wellbeing. The average cost of living in major cities is now comparable to that of some mid-range European capitals, and although low wages persist in some industrial areas, these are in most cases still above the minimum monthly subsistence threshold. The real ethical crux, therefore, is not so much the level of wages, but transparency and working conditions throughout the supply chain, especially in peripheral and less closely monitored regions.

As highlighted by an investigation published by environmental communicator Hannah Ritchie, the low costs of Chinese technology are also made possible by an industrial model based on economies of scale, extended working shifts and, in some documented situations, exploitation and forced labour, particularly in western regions such as Xinjiang. Global competition on the costs of green technologies therefore risks fuelling an energy transition that, while ecologically sustainable, does not always guarantee equity and the protection of human rights. The talk is of a transition that should be "just" in the European sense of the term — that is, inclusive and respectful of social rights throughout all supply chains. This is an issue the West will need to address with urgency if it wishes to build its own alternative industrial supply chain, founded not only on economic efficiency but also on principles of social and environmental justice.

Another critical aspect concerns the use of coal in the metallurgical industry and, therefore, in steel production: outside the energy sector, coal emissions rose by 3.5 per cent. The China Coal Association, the main organisation of the coal industry in China, expects that coal use in the steel and construction materials industry will decline, while coal consumption in the chemical industry is forecast to continue growing.

The future is written in 2025

In short, despite the good news, significant challenges remain for China. The first is meeting the targets of the 2015 Paris Agreement, when the Asian economy committed to reducing CO2 intensity (i.e. emissions per unit of GDP) by 60–65 per cent compared to 2005 levels: at present, according to Carbon Brief data, China has reduced its output intensity by 5 per cent relative to 2020 levels (other sources put the figure at 7.8), well below the 18 per cent target set for the 2020–2025 period.

Everyone agrees that 2025 will be a decisive year. The decarbonisation trajectory could consolidate, or it could slow down. Much will also depend on the new five-year plan that China will publish in 2026. That plan will contain energy and climate targets through to 2030, and will be the litmus test for determining whether the slowdown in emissions is only temporary, or the beginning of a new phase.

Meanwhile, encouraging signals are also emerging in Europe. Teresa Ribera, Executive Vice-President of the European Commission, recently reaffirmed that the EU is also close to meeting its climate targets, but that the next step will require an even clearer and more ambitious vision through to 2040. If Europe truly wants to play a leading role in the ecological transition, it must look carefully at the example of China, which is seizing industrial and technological leadership in renewables at an impressive speed – while, at the same time, the US retreats. Because the energy transition is not a distant possibility, but an industrial revolution already under way. The question is no longer whether it will happen: the question is whether we want to be part of it, or remain spectators of a change that waits for no one.