Published on Jan. 09, 2026

Artificial intelligence is beginning to play an increasingly important role in China’s energy transition.

In recent years, the country has installed the world’s largest capacities of wind and solar power, yet it continues to accelerate this shift to renewables to meet ambitious climate and decarbonisation goals.

AI is now being used to keep all systems running and minimise friction during the most enormous and rapid transformation any power grid on Earth has ever experienced.

China's total installed power-generating capacity reached 3.75 billion kilowatts (kW) by the end of October, 2025. Of these, nearly 2.2 billion kW came from renewable energy sources, amounting to 59.1 percent of the country’s total installed capacity, according to statistics from the National Energy Administration (NEA) in Beijing.

These are currently the latest available figures, but they already show that China leads the world in total installed renewable capacity by a large margin.

At the same time, the pace of change is accelerating even further. By October last year, solar power capacity had risen another 43.8 percent year-on-year to 1.14 billion kW, while wind power capacity grew by 21.4 percent to 590 million kW While having built the world's largest renewable energy system makes China a role model for the world, it also remains the world's largest emitter of greenhouse gases due to the sheer size of its population and economy. The ongoing shift to even more green energy is now putting an unprecedented strain on grid resources.

While wind and solar are helping to reduce emissions and making China less dependent on energy imports, they also come with a heavy price. Because wind and solar fluctuate sharply with weather and daylight, keeping supply and demand in balance has become a major challenge.

Power systems must stay in constant balance: generation must equal consumption at all times. With wind and solar, output fluctuates sharply with weather and daylight.

The growth of renewable capacity has outpaced the development of resources such as storage and flexible generation that can stabilise the system.

"As installed capacity of renewable energy continues to rise, both the source and load sides are exhibiting high levels of randomness, volatility, and uncertainty," wrote the newspaper Jiefang Ribao from Shanghai recently.

The traditional one-way operational paradigm of “generation source following load” and real-time balancing is no longer sufficient to keep everything in balance, the commentary stated.

"There is an urgent need to support intelligent energy management and real-time balancing through the interactive mechanism of Source-Grid-Load-Storage,” the newspaper wrote.

How Beijing is now rolling out large models across the country to address this urgent problem can already be studied in Shanghai. The metropolis has installed an “AI + Guangming Large Model.”

The large model "Guangming" uses multimodal cognition and dynamic decision-making capabilities. With its help, State Grid Shanghai Electric Power, the local grid operator, has built an entire ecosystem to coordinate supply and demand. Virtual power plants are also an important part of the design.

The AI has started to assist with grid regulation functions like peak shaving and valley filling, peak and frequency regulation, power flow congestion control, and fault handling, to name just a few. Most crucially, the system enables precise forecasting.

So far, the new AI-assisted energy system has helped the city save more than RMB 8 billion (approximately USD 1.2 billion) and cut carbon emissions by 510,000 tonnes, according to local media reports.

Now the country's planners are beginning to roll out this model nationwide. At the Integrated Smart Energy Conference held in Beijing on December 26, 2025, Lu Junling, Chief Economist of the National Energy Administration, called for a "deepening integration of artificial intelligence and energy".

In addition to the “ten replicable, promotable, and competitive pilot projects” planned under the national “AI+ Energy” programme by 2027, there is also a concrete milestone of “100 typical AI application scenarios” that provincial and local authorities must complete within the next two years.

"AI offers enormous possibilities for the future of energy and can play a critically important role", said Qian Zhimin, a leading official in charge of energy resources, in an interview with the official Xinhua News Agency this January.

China has only started to use AI for its energy system, Qian conceded. It is determined to make fast progress in the coming years, though.