China making good steps forward in the energy transition

Everyone is watching developments in China in promoting sustainable energy. Given the scale of economic growth that few of us can imagine, China knows only too well that it has to get on a more sustainable path. Rowan Callick, the China correspondent for The Australian, writes a good article about some of the important developments taking place in the energy transition.

 

China caps growth of CO2 as renewable energy embraced

China consumed just 1.4 per cent more energy last year despite posting economic growth of 6.7 per cent.

This underlines the country’s shift towards renewable energy, and the rapid take-up by its dominant coal-power sector of new high-efficiency, low-emissions technology.

Total energy production fell last year by 4.2 per cent, according to figures released yesterday by the National Bureau of Statistics. Energy intensity in the economy fell by 5 per cent.

Such a performance was all the more remarkable after heavy investment in new infrastructure, involving massive use of energy-dependent cement and steel, provided an impetus to gross domestic product growth.

Greenpeace said yesterday it believed that carbon dioxide emissions did not grow at all in China last year.

Coal accounted for 62 per cent of energy consumption, down from 64 per cent in 2015, with further falls targeted under the current five-year plan of capping it at 55 per cent by 2020.

Greenpeace said China was on track to exceed its 2020 ­climate targets if the rapid shift to clean energy and away from an over-reliance on polluting ­industries continued.

China installed 82 per cent more solar capacity last year than in 2015 to reach 77 gigawatts and wind power grew 13 per cent to 149GW. But 17 per cent of wind power, much of it located in the west far from most industry and large cities, was not integrated into the national grid.

China produced 9 per cent less coal last year than in 2015, underlining the growing consensus among energy experts that China’s consumption of the resource peaked in 2014. New generation coal power stations are creating more energy, through more intense and efficient technology, from smaller coal inputs.

But Australian think tank the Institute for Energy Economists and Financial Analysts commented yesterday that the ­capacity utilisation rate in the coal power sector was also falling, to just 47.5 per cent last year

Xu Zhaoyuan, the research head of industrial economy for the State Council, said the ­Chinese economy was entering a “new normal”.

“A stage of moderate growth, with overall energy demand unlikely to significantly increase again,” Mr Xu said.

“Furthermore, clean energy will keep growing rapidly in the coming years, and energy ­intensive industries will continue to shrink due to resource and environmental constraints.”

The latter refers to the strong priority given politically to reducing pollution, which remains one of the most cited causes of popular discontent and criticism of government in China.

Imports of coal rose 25 per cent to 255 million tonnes last year, following two years of substantial falls, as China acted to reduce overcapacity in its own coal mines, with output declining by 9 per cent.

Australian revenues from coal sales to China reached $5.6 billion in the last financial year, though that figure includes coal for steel making as well as for the generation of power.

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