Stronger wind generation is expected to trim China's 2026 liquefied natural gas demand by 100,000 metric tons to 63.7 million mt as it offsets weaker late-summer hydropower, Kpler said in a Tuesday note.
Kpler expects the transition from La Nina to El Nino to bring drier and windier weather during July and August, boosting wind generation before weaker rainfall reduces hydropower output during August and September.
The stronger contribution from wind power should largely offset softer hydropower generation, limiting gas-fired electricity demand during peak summer.
Kpler said the demand revision is too small to materially change regional balances or prompt Asian spot LNG prices.
China's National Energy Administration reported that solar capacity reached 1,262 gigawatts in May, up 178 GW, or 16%, over the year.
Wind capacity increased 97 GW, or 17%, to 665 GW, while hydropower capacity rose 14 GW, or 3.1%, to 452 GW, Kpler said.
China generated 866 terawatt-hours of electricity in May, an increase of 56 TWh from a year earlier, as rising electricity use across the industrial, commercial and transportation sectors continued to support demand, according to the report.
Kpler said developers adopted a more cautious approach to new renewable installations after China introduced market-based pricing for renewable electricity earlier this year, contributing to the slowdown.
Reflecting that trend, Kpler reduced its 2026 solar installation forecast to 150 GW from 200 GW and lowered its wind installation outlook to 90 GW from 120 GW.
Despite those revisions, Kpler expects combined wind and solar capacity to expand by 240 GW over the year to 1,927 GW by the end of 2026.
China aims to expand total installed power capacity to 5,400 GW by 2030 under its 15th Five-Year Plan for the New Energy System, with wind and solar expected to contribute over half of that capacity.
Even after lowering its installation forecasts, Kpler expects combined wind and solar capacity to approach 2,900 GW by 2030, comfortably above the government's minimum goal of 2,700 GW.
Renewable generation continued to displace thermal output as solar production increased by 25.4 TWh over the year, hydropower rose by 13.3 TWh, wind added 4.1 TWh, and gas-fired generation grew by just 0.6 TWh.
China's LNG demand in 2026 will depend more on how efficiently renewable assets operate than on the pace of new installations, reducing the impact of weaker capacity additions this year, Kpler said.
Kpler expects the recent slowdown in renewable project development to have a greater effect on China's LNG demand in 2027 than in 2026.
The firm sees limited upside to its LNG demand outlook unless wind generation misses forecasts by a wide margin or a more severe late-summer drought further weakens hydropower output.