Energy Use Still Growing

China's energy consumption is growing at faster rates, despite claims on efficiency and the environment.
Michael Lelyveld
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hill_305 View of a coal mine plant in Huaibei, east China's Anhui province on Dec.21, 2009.

BOSTON—China's energy use appears to be accelerating, even as the government claims it is making environmental gains.

In 2009, China's power consumption rose 6.4 percent to a record 3.6 trillion kilowatt-hours, the official Xinhua news agency reported, citing the State Electricity Regulatory Commission.

The growth rate outpaced the 5.2-percent increase in 2008, reported a year ago.

Oil imports surged some 14 percent to over 4 million barrels per day last year, China's General Administration of Customs reported. In 2008, imports rose 9.6 percent from a year before.

The figures underscore the rapid growth of China's energy consumption, while the government focuses on improving energy and carbon "intensity."

The intensity indexes measure only energy and emissions per unit of GDP rather than total volumes, which keep rising as the economy expands.

Demand keeps growing

"China's economy will continue to grow and use a lot energy for the foreseeable decades," said Philip Andrews-Speed, a China energy expert at Scotland's University of Dundee.

"Whatever they do to reduce energy intensity and carbon intensity, the total energy demand is just going to keep growing," Andrews-Speed told Radio Free Asia. "It's a matter of how fast it grows and how quickly that growth slows down."

The government has focused on the intensity indexes as China's contribution to the fight against global warming. The country is already the world's largest emitter of carbon dioxide (CO2), according to the International Energy Agency.

At a U.N. climate conference last month in Copenhagen, China repeated its pledge to lower carbon intensity 40 to 45 percent by 2020. But its economy and energy use are set to grow even faster, pushing more CO2 into the atmosphere.

Andrews-Speed said that rising power consumption and oil imports are signs of an accelerating economy after a period of slower growth in early 2009.

"It's showing that the economy is now moving again," he said.

Model 'unsustainable'

On Jan. 21, the National Bureau of Statistics reported that China's economy grew 8.7 percent in 2009. But coal production rose at an even faster 12.7-percent pace to nearly 3 billion tons, prompting pollution concerns.

The climate debate has spurred calls for changes in China's economic model, which has stressed investment and production in construction industries.

In a Jan. 18 opinion piece, the official China Daily called the country's growth model "unsustainable in the future," noting that China now accounts for 27 percent of global steel consumption and 40 percent of the world's cement.

China has been pursuing a policy of merging smaller producers into larger enterprises to boost efficiency. But Andrews-Speed said that policy may not be the answer, because the larger steel and cement groups only produce more.

"The key is not these energy-intensive industries and making them more efficient," he said. "The key is this whole focus on construction, and one has to ask what percentage of the construction is actually useful."

'Not a new concern'

Derek Scissors, research fellow for Asian economic policy at the Heritage Foundation in Washington, said there are doubts about China's latest energy data and how China calculates its efficiency and emissions indexes.

But the problems with China's economic growth model remain the same as they have been for years, he says.

"It's not a new concern. It's the same old concern," Scissors said. "The old concern about China polluting too much, emitting too much, and using too much energy is still there."

Scissors said China's government reacted to the slowdown in late 2008 with a large stimulus package that relied heavily on construction projects.

"They've hyperstimulated the economy, and at least for right now the economy is stronger than it was at the end of 2008," he said. "Not surprisingly, even on their data, they're polluting more, they're emitting more, and they're using more energy."

"They've changed right back to the path they were on before," Scissors said.

Construction promoted

The government's response to the slowdown is responsible for soaring real estate prices, which have prompted warnings of a sudden slide, he argued.

"There's an absolute commercial real estate bubble right now, and it was inflated by the government in response to economic weakness," said Scissors.

Despite claims of improved efficiency, China has continued to promote the construction industries responsible for greater total emissions, he said.

"In 2006, when everything was great, they were pumping up the industrial part of the economy. In 2009, when things got weak, they pumped up the industrial part of the economy," said Scissors.

On Jan. 20, the State Council said it had discussed targets for cutting outmoded production in fields including power and steel. But it is unclear whether the government will curb the growth of construction-related industries.

"When things are good or when things are bad, China has one model," said Scissors. "There's no sign of them departing from it."


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