Shanxi Province, a significant coal powerhouse in China, serves as the focal point of our study, which investigates the policy frameworks established by the Chinese government to promote green energy production while concurrently enhancing the livelihoods of local communities. Our findings indicate that the revitalisation and advancement of the coal sector are pivotal to the local economy, positioning Shanxi as a trailblazer for comprehensive national reform and setting a standard for innovation and sustainable development. Given the province’s current financial landscape, which is heavily reliant on coal resources, the adoption of advanced technologies in coal mining and extraction processes promises to enhance productivity, fortify the local economy, and ultimately elevate the livelihoods of its residents, in alignment with the Sustainable Development Goals (SDG) 8, which advocates for decent work and economic growth. However, we argue that integrating such green technology in coal operations is very limited, and in turn, unsustainable mining practices pose a significant threat to the regional environment and public well-being. Our study highlights that, besides strengthening legal frameworks, the Chinese government has initiated several sustainability projects to mitigate ecological damage in Shanxi’s coal mining sector, including integrating renewable energy sources and promoting green and intelligent mining practices. Thus, this book chapter study poses a critical question: How can policy measures effectively support sustainable coal mining practices while bolstering local livelihoods in Shanxi Province?