China Pursues More Controls on Coal

An analysis by Michael Lelyveld
2014-04-28
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china-coal-emissions-jilin-jan-2014.jpg
Smoke is discharged from chimneys at a coal-fired power plant in Jilin city, Jan. 8, 2014.
IMAGINECHINA

As China struggles to clear its skies of hazardous smog, some experts see signs that it is starting to get coal use under control.

China accounts for half the world's coal consumption, making the high-polluting fuel a major cause of its air quality woes.

In a decade-long period ending in 2011, China's coal burning more than doubled, while its share of global coal use soared from 30 percent to nearly 50 percent, the International Energy Agency (IEA) has said.

Last September, China's government announced an anti-smog plan that would cut the country's reliance on coal to less than 65 percent of its energy needs by 2017 from 66.8 percent in 2012.

While the national goal may be only a partial down-payment on curbing pollution, some analysts see greater benefits from additional measures that provincial governments are planning to take.

If the new efforts prove successful, they could have a major impact on world emissions of carbon dioxide (CO2) and the pace of climate change, said the environmental group Greenpeace East Asia.

"If achieved, the measures will not only fundamentally shift the coal consumption trajectory of the world's largest coal consumer, but also significantly re-shape the global CO2 emissions landscape," said Greenpeace in a report released on April 11.

Provincial plans


Greenpeace cited plans to control coal use in 12 of China's 34 provincial-level governments that account for 44 percent of the country's coal consumption.

Six governments have already targeted decreases as part of their anti-smog plans. The list is led by Beijing, which would cut 50 percent of its coal use by the end of 2017 from levels of 2012.

The Greenpeace analysis found that coal use could be trimmed by 350 million metric tons from previous growth forecasts, assuming that all provinces will reduce the rise in consumption by one-third as economic expansion slows.

If the trend continues to 2020, the savings could reach 655 million tons of coal, lowering CO2 emissions by 1.3 billion tons, the group said.

'Close to' on track


China's government rarely reports coal figures, but in January, the China National Coal Association said consumption reached 3.61 billion tons last year, suggesting the estimated reductions by 2017 would be less than 10 percent of annual use.

But the projected savings in emissions would bring China's releases "close to" the track that the IEA has calculated as necessary to hold the rise in global warming to 2 degrees Celsius (3.6 degrees Fahrenheit), Greenpeace said.

The track is critical because the United Nations Intergovernmental Panel on Climate Change (IPCC) has established the 2-degree mark as the limit to avoid the worst effects of warming, including a rapid rise in sea levels.

In a report earlier this month, the IPCC warned that the world will exceed the danger point at current rates of growth. To meet the target, countries must pursue new technologies to reduce emissions by 40 to 70 percent before 2050, the panel said.

Western and developing countries have been locked in a virtual standoff since 2009 about binding commitments to cut greenhouse gas emissions, as industrialized nations have argued that their reductions will be useless as long as China's coal use continues to grow.

Greenpeace has argued that developed nations are not doing enough to reach the 2-degree trajectory for emissions on their own.

"To get to the trajectory altogether, ... other big polluters will have to deliver on their emission cuts too," the group's analysis said.

The Greenpeace forecast of China's coal use is more optimistic than that of the IEA in its annual World Energy Outlook last November.

The Paris-based agency projected that China's coal demand will not peak before 2030, although growth could be minimal after 2020 if new policies that have been promised are applied.

Uncertainties

The Greenpeace estimates may also be subject to a series of uncertainties.

A major concern is the accuracy of China's coal data, since the total of provincial consumption figures has often exceeded national numbers by several hundred million tons a year.

Philip Andrews-Speed, a China energy expert at National University of Singapore, questions whether all the areas that have set reduction targets will meet them.

Beijing and Shanghai may, but there is less certainty about poorer industrialized centers like northern Hebei province with its concentration of steel and cement plants, Andrews-Speed said.

He also wonders whether coal use will "just migrate to other regions," if local governments push out energy-intensive industries to meet their own anti-smog goals.

Greenpeace said coal caps could be introduced in other provinces to "ensure that polluting industries do not simply relocate," but some smog-shifting may already be underway.

Beijing plans to move six heavily polluting industries out of the city, according to a senior official. The list includes foundries, electro-forging, brick sintering and waterproofing materials, the official Xinhua news agency reported on April 15.

Zhang Boxu, director of the Beijing Municipal Commission of Economics and Information Technology, said the polluting operations "will not be accepted anywhere" unless they meet national emissions standards.

Strict enforcement

But the impact of strict enforcement on the economy and employment could be significant. Under its air quality plan, Beijing will move 300 polluting companies out of the city this year, Xinhua said in a separate report.

Last September, the capital also promised to close all its coal-burning power plants by 2017, suggesting the city will probably be supplied with coal-fired power from elsewhere.

The central government may promote national emissions standards, but it has already acknowledged problems with enforcement.

The administrative National Development and Reform Commission (NDRC) and the Ministry of Environmental Protection recently issued a warning to coal-fired power plants that have charged higher prices to cover the cost of anti-pollution devices without actually using them.

"According to the NDRC, some plants have cheated by raising prices of their power without running their facilities to clear discharges," Xinhua reported on April 3.

Environmentalists have complained for years that coal-fired generators have been operating with their pollution devices turned off.

In 2009, the NDRC raised electricity rates for industrial consumers to help power producers pay for "scrubbing" equipment to remove sulfur dioxide from their emissions. But the devices use more electricity, requiring more coal, tempting some power companies to save the expense.

Andrews-Speed said the trajectory for future coal use could also change if the economy recovers from its slower growth rates.

"If economic growth picks up and if the economic structure does not change rapidly, then the growth of coal use will keep pace with natural gas and renewables," he said.

At an energy conference organized last week by the Seattle-based National Bureau of Asian Research, an industry expert argued there would be an inevitable impact on economic growth from reducing coal use to meet environmental goals.

"If you do a little bit of reduction in coal-burning, you'll reduce growth a little bit. If you do a big reduction, ... you'll hurt growth even further," said Andy Roberts, a coal analyst with the international consulting firm Wood Mackenzie.

"You just have to accept that that's the trade-off that we're in, at this point in time, with the box of technical solutions that we have," Roberts said.