The performance of Chinese governance is widely rated as poor. Nevertheless, some authors evaluate the recent reforms as providing a chance to improve the governance within China. Although quantitative attempts to measure governance performance have been made, the results need more interpretation. To evaluate the performance of Chinese governance, this thesis begins with a review of different theoretical concepts of governance. The literature on the performance of the governance within China and quantitative approaches attests to China’s moderately good performance in relation to effectiveness but sees a major problem in what we could define as ‘good governance.’ The interpretations of some particular reforms provide no clear answer as to whether they constitute a step towards improving the system or if the problem will worsen. Consequently, this thesis includes a case study on the galloping growth of coal-fired power plants within China which offers a different perspective and demonstrates that China’s central government is incapable of implementing its energy policy at the local level. Illegal power plants and the disregard for environmental rules are an evident sign of a failure of governance. But I argue that China’s governance problems and failures do not matter in the short term. It is the price that China has to pay for the central government’s determination to achieve fast economic growth, and it is a bill that will to be paid in the future.