Explaining the energy mix in China’s electricity projects under the belt and road initiative

Abstract

ABSTRACTThis paper explains the energy mix of China’s overseas electricity investments across Belt and Road Initiative (BRI) recipient countries. We focus on Indonesia and Pakistan. Our research is based on both newly gathered project-level data and in-depth interviews with stakeholders of Chinese-backed power plants in Indonesia and Pakistan. We examine (1) why Chinese actors are involved in renewable power generation in Pakistan and not in Indonesia, and (2) why Chinese-backed coal-fired projects in Pakistan are cleaner than in Indonesia. We argue that variations along the three dimensions – scope, governance regime, and issue linkage – lead to different energy mixes in Chinese-invested power plants across BRI countries. This framework specifies how supply and demand factors interact across multiple levels regarding the formulation and implementation of China’s overseas electricity projects. Our findings shed new light on the environmental implications of BRI projects and the dynamics of renewable energy development in emerging markets.