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Understanding the energy challenge

China needs low-carbon development to ensure its energy security. In this effort, writes Lin Boqiang, the country could become a model for other developing nations.

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[Produced in association with Rutgers Climate and Social Policy Initiative]

China needs a low-carbon economy not only to meet the challenges of climate change, but also to address its other environmental problems – and its energy security. The country’s immediate ecological problems are plain to see; here, I will attempt to understand China’s energy problems.

China has large total energy reserves, but its population is huge – and thus its per capita reserves are low. Per capita extractable reserves of coal, oil and natural gas are in fact far lower than the global average. If China’s massive population increases its energy consumption, that scarcity will become more apparent.

China is better off than Japan in this regard, but China’s economy is still developing and it faces more severe challenges than Japan did at the same stage of its development. Japan’s industrialisation was aided by cheap energy and a lack of environmental concerns. Late-developing economies face greater energy and environmental constraints as they industrialise and urbanise: energy costs are rising, and environmental options are contracting. The costs of dealing with environmental damage further increase the costs of development. China’s biggest challenge this century will not be today’s financial crisis; it will be the energy and environmental pressures of tomorrow.

International energy markets are small when confronted with Chinese demand. However, if we compare primary energy consumption across major countries, we find that Chinese energy demand is rising, but per capita consumption is still low – although that of India is even lower. Between now and 2030, energy demand in China will double; in India it will triple. Developed economies, such as the United States and Japan – where industrialisation and urbanisation have been achieved – will only see low levels of growth in their energy consumption.

However, despite growth in India and China, per capita figures will remain far below those of the developed world. In 2030, per capita energy consumption in China will be a little more than one-third of that in the United States; India’s will be one-tenth. China’s massive demand for energy will also have an impact on international energy prices; historically, anything that China buys has gone up in price, and the country’s growth will be further impacted by high prices.

Comparing energy consumption structures across major countries in 2007, we find that China’s primary energy came mainly from coal: a crucial factor in terms of pollution. Although the use of oil, natural gas, hydropower and renewable energy sources has increased in recent years, coal still accounts for a very high proportion of China’s energy consumption: 69.5% in 2007, compared with 20.1% for oil, 3.3% for natural gas and 0.7% for nuclear power. India’s energy mix is also dominated by coal, which provides 51.5% of its power. Japan and the United States draw less than one-quarter of their energy from coal.

As a country rises out of poverty, short-term benefits often trump long-term concerns – hence energy resources and the environment do not receive the strategic planning and protection they deserve. At the moment, there is a thirst for power in China, and if the government allows it, this demand will be met with cheap coal. China is currently the world’s second largest producer and consumer of energy, and is undergoing a phase of rapid development characterised by intense extraction and consumption of energy. Hence the tension between sustainable development and limited energy reserves increases, and China’s own need to save energy becomes ever more pressing. It is generally accepted that China has significant scope to save energy; overall energy efficiency is around 33%, 10 percentage points below developed nations. This is often used as evidence that China is energy-inefficient – but that is not the whole truth of the matter.

In fact, China’s energy consumption per capita is far lower than that of the United States or Japan when they were at the same GDP per capita level, according to research by the Center of China Energy Economics Research at Xiamen University. The US and Japan reached a GDP per capital level of US$2,000 (13,655 yuan) in 1951 and 1970 respectively. It is estimated that when China reaches that GDP per capita level, energy consumption per capita will be only one-quarter of that of the US, and half of Japan’s (and slightly lower than the comparable point in the history of Taiwan, which reached a per capita GDP of US$2,000 in 1979, and was then consuming the equivalent of 2.1 tonnes of coal per capita). Therefore, it doesn’t seem correct to blame China for wasting energy: we can only say that the times have changed, as has the situation regarding energy and the environment.

Comparing energy utilisation rates across different countries at the same stage of development, China’s energy efficiency during industrialisation is no worse than that of the US and Japan during the equivalent phase of development. Energy was cheap while the US and Japan were industrialising and there were no environmental constraints: the two nations could use energy as they liked. Improved technology is clearly helping to change this situation: for instance, in the past five years the bulk of China’s coal-fired plants have been built to high international standards; they are significantly more efficient compared with older US plants.

However, China’s low energy efficiency compared to developed nations indicates the scope for the development of a low-carbon economy. Current levels of technology allow for further energy-efficiency improvements: several percentage points of energy saving would have a huge impact. China’s massive population means there is great scope for energy savings through the adoption of low-carbon lifestyles.

Like developed nations, China must go through a stage of urbanisation characterised by high energy use and emissions. But unlike those countries, China’s urbanisation faces challenges that include addressing climate change, ensuring food security and combatting energy shortages. The financial crisis will impact on China’s short-term economic growth, but the country’s rapid expansion will continue: the process of urbanisation is unstoppable, and energy demand will continue to grow. A correct understanding of China’s energy security and environmental issues should be the starting point for low-carbon development, and for setting the targets for that guide that development.

China’s low-carbon growth is of great global significance. The efforts of developed nations to cut emissions will be of instructive value to developing countries, but they are not entirely relevant: there are differences between populations of different developmental stages in terms of the inclination and ability of people to pay environmental costs. As a developing country, China’s experiences of creating a low-carbon economy will be of greater value for other developing nations.

Controlling greenhouse-gas emissions means controlling emissions growth. India is a factor that cannot be ignored. Its population will overtake that of China; since it mainly relies on coal power, India will face similar challenges to China in terms of emissions. Therefore, developing China’s low-carbon economy is not just a mission for China, it is a global one. If China can find a low-carbon path, India and other developing nations will be able to follow in its footsteps.


Lin Boqiang is professor at the Center of China Energy Economics Research, Xiamen University, and a member of the Changjiang Scholars Program.


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Default avatar
匿名 | Anonymous

意义何在

通观本篇文章,作者似乎一直在为中国的能源现状辩解,而没有提出什么有实际意义的建议,私以为这种空谈没什么意义。

Meaningless

The entire article is in defense of China's energy problems. Nothing constructive is put forward. I think this kind of pointless talk is meaningless. (Translated by Jo)

Default avatar
匿名 | Anonymous

随写

一日与朋友讨论,她似乎和楼上观点相似, 当前的环境学家都在提出问题,但始终没有提出如何解决问题. 但如果没有发现问题, 提出问题,何来如何解决问题. 中国的现象就是, 要呼吁关注的人多了, 才能引起政府注意.

casual notes

One day,I am discussing with my friend, who seems to agree with one previous comment. Nowadays, environmentalists are always raising problems ,but never come up with solutions.However,without finding out or putting forward problems,how to solve them? More Chinese people care the problem, more attention the government would pay to it.

translated by anna.chen

Default avatar
匿名 | Anonymous

没太读懂

没太完全读懂林教授说的能源挑战,不过作者提出的几个问题的确很值得思考,“不能得出中国目前能效低的结论”,中国在技术上已经是国际先进,但看来技术并不能解决排放问题,中国的能源结构改革需要大智慧。

I didn’t quite understand

I didn’t fully understand what Professor Lin was saying about energy challenges, but the problems that the author mentioned are worth thinking about: “One cannot make conclusions about China’s current low energy efficiency.” China is already a leading country in terms of technology; however, technology will not resolve the emissions problem. China’s structural energy reform needs a lot of wisdom and knowledge. (Translated by Michelle Deeter)

Default avatar
匿名 | Anonymous

从商

我认为中国不能只局限于政治上的自圆其说,毕竟时代不同了。中国政府要求西方国家转让技术和提供资金的帮助有很多操作上的困难。

既然外交走不通,为什么不走民间的方式,通过商务和贸易来引进西方的清洁能源技术,甚至通过政府鼓励投资来吸引西方的相关企业来华投资。这是我们所希望的,也是现在的一些外国企业期望的,更是西方政府所不能阻止的。

Business aspects

I think China cannot limit itself to political self-justification because ultimately, the times have changed. The Chinese government’s demand to transfer technology and provide financial assistance is difficult to put in practice. Since the foreign diplomats do not agree, why not use non-governmental methods, using commerce and trade to introduce Western clean energy technology? One could even let the government encourage investment to attract relevant Western companies to come to China to invest.
This is what we hope for, and it’s also what foreign companies expect. It is something that Western governments cannot hinder. (Translated by Tian Liang)

Default avatar
匿名 | Anonymous

感受一下

自我认为:
林教授的文章只是自己一些的感受,没有对什么具体问题做出充分地论证,我们只需要感受这个领域的专家对一些问题的观点即可。至于如何去做,这个问题太复杂。
yzhk

just listen to it

My own opinion is: Professor Lin's article is just his own feelings. There's nothing concrete to prove them thoroughly. We may read it and listen to his opinions. But when the question comes to how to handle it, it's too much difficult. yzhk
translated by tingting