China’s industries are actively advancing the energy transition and upgrading to meet the country’s ambitious goals of carbon peaking and carbon neutrality. While clean energy is expanding rapidly, traditional fossil fuels continue to be part of the energy system and underpin social and economic development.

Coal production emits a lot of greenhouse gases, including methane. Coal mine methane (CMM), is emitted into the atmosphere during activities such as coal extraction, washing, transportation, and storage, and constitutes a significant portion of emissions associated with coal production — as much as 57 percent of the total by some estimates. Thus, it is a primary target for emissions reduction. Recovering and utilizing CMM as an energy source not only supplements energy supply, enables resource utilization, and delivers economic value, but it also directly reduces methane emissions, providing an effective way to avoid temperature rise in the short term.

As one of China’s key initiatives for emissions reduction in coal production, CMM recovery and utilization has yielded remarkable results with the support of government policy. In recent years, China continues to introduce methane emissions control targets and policies, unlocking the potential for further development of CMM recovery and utilization. The Methane Emissions Control Action Plan jointly released by several ministries and commissions in 2023 identifies CMM recovery and utilization as one of the key actions of methane emissions control in the energy sector. Policies have unlocked new opportunities for the CMM utilization market while also creating development prospects for technologies that, despite having significant potential, face challenges in terms of economic viability, technological maturity, and market acceptance.

This report, cowritten by RMI and China University of Mining and Technology (Beijing) enables policymakers, enterprises, investors, and other stakeholders to better identify the potential and possibilities of CMM recovery and utilization. It analyzes and explores the status of China’s CMM technology and its recovery potential, while offering an outlook on the maturity, cost, and investment needs of CMM technology in China and suggestions for next steps. It aims to provide a reference for relevant market participants and policymakers.