China Emissions Spark Climate Debate

An analysis by Michael Lelyveld
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Smoke is discharged from chimneys at a coal-fired power plant in Jilin city, Jan. 8, 2014.
Smoke is discharged from chimneys at a coal-fired power plant in Jilin city, Jan. 8, 2014.

Experts are at odds over China's efforts to curb greenhouse gas emissions, clouding forecasts for combating climate change.

On June 8, analysts at the London School of Economics (LSE) raised hopes for avoiding the worst consequences of global warming in a paper predicting that China will reach a peak in carbon dioxide (CO2) emissions well before the 2030 target set by President Xi Jinping last year.

China's emissions "are much more likely to peak by 2025. They could peak even earlier than that," said policy analyst Fergus Green and Nicholas Stern, a former World Bank chief economist, at LSE's Grantham Research Institute on Climate Change and the Environment.

Key factors cited for the improved outlook include the government's "new normal" economic policies of accepting more moderate growth rates and a 2.9-percent drop in coal consumption in 2014, according to official data.

Greenpeace/Energydesk China recently estimated that coal use also fell nearly 8 percent in the first four months of this year from the year-earlier period, based on production reports by the National Bureau of Statistics (NBS).

The decline in coal burning through April has cut CO2 emissions by 5 percent from a year before, Greenpeace said.

An early peak of emissions in China could prove crucial to keeping the growth in global temperatures below 2 degrees Centigrade (3.6 degrees Fahrenheit), the limit set by the United Nations Intergovernmental Panel on Climate Change (IPCC) for averting drastic warming effects such as a major rise in sea levels.

The study foresees the possibility that China could rapidly reduce greenhouse gas (GHG) emissions after the peak is reached in 2020-2025 by implementing a series of structural policies and reforms.

Early peaking could "hold open the possibility" that the world would stay within the 2-degree goal, the authors said.

Preparation for Paris

In order to keep the possibility open, China would have to cut some 15-20 percent of its emissions by 2030 with measures including more efficient urbanization, further coal reductions, new technologies, tax changes and pricing reforms.

The study is one of many that can be expected in preparation for an international climate conference in Paris in December, when national pledges for GHG limits are expected to be specified.

But the LSE outlook for China appears to be far more optimistic than a key forecast offered one week later by the Paris-based International Energy Agency (IEA) in a preview of
its annual World Energy Outlook, focusing on climate change.

"Given the pace at which China's energy sector emissions have grown, achieving a peak in emissions by 2030 will require a significant change in direction," the IEA said.

For years, China argued that its role as the world's leading emitter of energy-related CO2 should be balanced by its far lower per-capita emissions compared with the United States and past pollution by the industrialized West.

But China's per capita emissions have already matched those of the European Union, while its total was about one- third higher than U.S. emissions last year, according to IEA estimates.

By 2030, China's emissions will be two-and-a-half times more than those of the United States, based on current "intended nationally determined contributions" (INDCs) to the climate change effort, the IEA said.

Last November during President Xi's visit to Washington, President Barack Obama pledged to lower U.S. emissions 26-28 percent from 2005 levels by 2025, which the study said would amount to the largest reduction in the world.

In a joint commitment hailed as "unprecedented," Xi announced China's goal of peaking CO2 emissions "around 2030," or possibly earlier, and increasing the non-fossil fuel share of energy use to 20 percent.

At last week's Strategic and Economic Dialogue meeting in Washington, special climate change representative Xie Zhenhua suggested China could go further with its INDC commitment.

Planned measures would require investments of 41 trillion yuan (U.S. $6.72 trillion), Xie said.

Stronger action urged

On Monday, state-run China Daily said an announcement was expected during Premier Li Keqiang's visit to Europe this week.

Based on INDC pledges indicated at the time of its study, the IEA sees no peak in world CO2 emissions by 2030 and no chance of keeping within the 2-degree bounds.

"If stronger action is not forthcoming, the INDC scenario is judged to be consistent with a global temperature increase of around 2.6 degrees Centigrade in 2100 and 3.5 degrees after 2200," it said.

One reason for the differing forecasts is the split over the pace of progress in China, which would account for 29 percent of global emissions in 2030 compared with 11.5 percent for the United States.

The IEA sees China's peak emissions as coming later and lasting longer than the LSE study predicts.

"Effective policy intervention across a range of sectors will also be required if the steep emissions growth observed in recent decades is to be succeeded by a similarly sharp slowdown in the years to come," the agency said.

Despite China's new environmental law, stricter enforcement and greater efficiency, the country continues to burn more coal than the rest of the world combined.

Unfortunately for the planet, the effects of GHG emissions are cumulative, putting all nations on smaller "budgets" for future releases in order to meet the 2-degree goal.

David Fridley, staff scientist at the China Energy Group of the U.S. Department of Energy (DOE) Lawrence Berkeley National Laboratory, said the LSE forecast appears to be "overly dependent on 2014 being a pivot year for coal consumption."

"In my experience, one year of data is simply insufficient to extrapolate from, particularly in China, where the data themselves are of questionable reliability," Fridley said in an email message to RFA.

In 2014, coal consumption fell for the first time in 14 years to 3.51 billion metric tons, according to National Bureau of Statistics (NBS) data, lifting hopes that CO2 emissions could soon follow suit.

Doubts overshadow forecast

But several doubts overshadow the forecast.

One major concern is that China's coal reports are notoriously questionable. A Stanford University study from 2011, based on provincial totals, found that coal data may be understated by as much as 500 million tons per year.

Some of the reported decline may also be due to non- recurring conditions.

A big jump in hydropower generation last year, variously estimated at 18-22 percent, helped to keep coal-fired power production down. Hydropower output has risen over 50 percent since 2011, thanks largely to a series of unusually wet years.

Rock-bottom coal prices and huge overcapacity of China's coal-fired power plants may also continue to dampen emissions reductions without stringent new policies and preventative steps.

This year, coal prices have dropped by over 20 percent from already-low levels in 2014, making it more costly for industry and power producers to replace with cleaner fuels.

Utilization rates at thermal power plants fell to a record low of 53.7 percent last year, according to Reuters, creating incentives for coal burning that could be hard to overcome.

Since coal-fired power accounts for 38 percent of China's coal consumption and a similar share of CO2, closures may be crucial to achieving emission goals.

The IEA projects that 95 percent of existing coal-fired power capacity will still be operating in 2030 under current INDC plans, establishing a base of emissions that will be hard to drive down.

Even if coal use can be controlled, China's emissions may continue to grow.

"CO2 won't peak when coal peaks, since there's not a commensurate peak in oil and natural gas demand growth," Fridley said. It may be five years or more before emissions cease to increase.

Perhaps most important, both the optimistic and more pessimistic forecasts presume that China's government will continue to resist a return to the highly-polluting economic stimulus policies that staved off recession in 2008-09.

The recent push for more local infrastructure projects and "targeted" stimulus spending have raised concerns that longer-term environmental goals may again take a back seat.

DOE researchers foresee a longer plateau of coal use at a high level, "in part because we also see a plateau of a decade or so for heavy industrial output after those volumes peak, as well," said Fridley.

The result "can easily push the CO2 peak out to the 2030s," he said.

In light of the risks, the IEA study urges more ambitious INDC pledges and a "bridging strategy" to achieve peak emissions by 2020 with a series of measures, including increasing energy efficiency and banning construction of inefficient coal-fired power plants.





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