The Chinese Energy Transition - Is China the Cleanest Polluter in the World?

KF - Writer

China (like much of the world) is undergoing an energy transition- but what does that mean? Put simply, an energy transition is a societal and technological shift from one dominant fuel type or method of energy generation to another. This occurred during the industrial revolution, when coal power accelerated the mechanisation of the developed world. It is now happening on a global scale as the world transitions slowly from total dependence on fossil fuels to renewable technologies such as solar and wind.

Historically, China has been heavily dependent on fossil fuels, earning themselves a global reputation for polluted airways and a ‘heads down lads’ approach to the environment. However, while this reputation is undeniably founded in fact, it isn’t the whole truth. According to the International Energy Agency, China (along with India) accounted for 40% of the increase in global energy demand in 2017 and 25% of natural gas demand increase. As their industry and population grows, so does their demand for energy and the fuels which provide it. The rest of the world seems to be taking a convoluted approach to cleaner fuels such as renewables. The secret is out: fossil fuels are but the balls in a global game of Hungry Hippos and eventually we will gobble them all. This is now common knowledge to the average citizen (climate deniers aside) and every political campaign and ‘25 year management plan’ seems littered with goals and promises about integrating renewables into the energy system. However, while most developed countries are fully prepared to berate their developing counterparts for committing the fossil fuel sins that we swept under our own rugs long ago, very few seem willing to actively lead the way to change.
Except, perhaps for China.


Interestingly, China and the USA accounted for half of all renewable electricity generation in 2017. So how did the country with arguably the dirtiest reputation for energy achieve such a landmark? Well, as it turns out China has been quietly leading the global market in renewable technology such as hydroelectric, solar and wind power for years now, quietly cleaning up their act without much ado. Having increased investment in its international clean-energy projects by $12bn in just one year, China’s total clean energy project investment reached a staggering $44bn in 2017.

In the world of solar, the country has made huge strides with Chinese factories making up 60% of global solar cell manufacturing. This progress, while impressive, has not come without its drawback. Aggressive investment in the solar market has led to a rapid fall in the cost of the technology and while this may sound like a great thing for the average solar enthusiast, it’s created a complicated problem. During periods when the sun has got his hat on and solar production is high, overproduction of electricity can occur. Unfortunately, there are very few options available when it comes to electricity storage so this energy will be wasted if people do not lap it up quickly. The rapidly falling cost of technology combined with periods of overproduction means that the cost of solar power can become negative. This has all sorts of economic effects and if the value of solar deflates too much then investment will be stunted, preventing further development. This became the case in 2018 when the Chinese government ordered a halt to all planned solar plants in order to prevent value deflation from overproduction. Like a cool kid with the latest trendy trainers: everyone wants a pair. This means increased demand for them and therefor production increases in response. Higher production means more availability which means an individual pair of trainers is now far less valuable. If there are more trainers than feet to wear them, the manufacturer starts putting them in the discount bin to tempt people into buying them. That’s part of the problem that solar is facing, you can’t develop new technology if your current product is in the discount bin and no one really wants it while it’s in there, so to speak.


Currently, China is the largest market for electric vehicles, and they have invested heavily in hydroelectric power with famous developments such as the Three Gorges Dam. China has a large stake in the global wind market but faces issues within its own borders due to largely variable wind speeds across the nation. China’s investment in renewables has been swift and relatively successful, begging the question: what’s the hold up with the rest of the world? Engles (2018) has observed that the authoritarian Chinese government are able to make quicker changes than democratic countries as they are not as restricted by public opinion or complex red taping. In this sense, the government making decisions and enforcing them as law without long winded public consultation has resulted in much faster adoption of green strategies than the UK and USA.

So, with all this investment in renewable technology, China must have made a pretty big dent in their carbon footprint and really lowered those CO 2 emissions? Not exactly. China is still the world’s biggest polluter and emitter of CO 2 . In 2017 China still gained 79% of its power generation from fossil fuels, an increase of 7% since 2012. This doesn’t seem to add up with such huge investment in the renewable sector, however upon closer inspection it is clear that China’s investment in the renewable sector is global. The contributions they are making are not necessarily in their own back garden. Chinese state-owned companies are investing significantly in renewable generation projects in other countries, particularly across Europe. Also, it is important to remember that the Chinese economy is increasing (facing a slowdown in recent years) as is their population and energy demand. As large as China’s contribution to the renewable market is, there is still a long way to go before China can support its own population of approximately 1395.4 million people on a purely renewable energy system.


So: is China the world’s cleanest polluter? In a way, yes as their influence is speeding up the global renewable energy transition, making technologies cheaper and therefore more accessible to a wider market. However, when it comes to their own personal footprint fossil fuels still cast an intimidating shadow over the renewable contribution. The global energy market will be watching China very closely over the next 30 years to see if they can maintain this rapid pace in renewable growth and hopefully -one day- outpace fossil fuels.



Bibliography

Engels, A. (2018). Understanding how China is championing climate change mitigation. Palgrave Communications, 4(1).

Guan, D., Meng, J., Reiner, D., Zhang, N., Shan, Y., Mi, Z., Shao, S., Liu, Z., Zhang, Q. and Davis, S. (2018). Structural decline in China’s CO2 emissions through transitions in industry and energy systems. Nature Geoscience, 11(8), pp.551-555.

https://www.carbonbrief.org/china-leading-worlds-clean-energy-investment-says-report

https://www.pv-magazine.com/2018/07/04/the-china-effect-decreasing-utilization-rates-serious-oversupply-and-future-strategies/

https://www4.unfccc.int/sites/NDCStaging/Pages/All.aspx

International Energy Agency (2018). Global Energy & CO2 Status Report 2017. International Energy Agency.

Pachauri, S. and Jiang, L. (2008). The household energy transition in India and China. Energy Policy, 36(11), pp.4022-4035.

Urban Innovative Actions (2014). 30 Energy Cities' proposals for the energy transition of cities and towns. Energy Cities. European Regional Development Fund.

Du, J., Ouyang, M. and Chen, J. (2017). Prospects for Chinese electric vehicle technologies in 2016–2020: Ambition and rationality. Energy, 120, pp.584-596.

https://tradingeconomics.com/china/population

Liu, Q., Lei, Q., Xu, H. and Yuan, J. (2018). China’s energy revolution strategy into 2030. Resources, Conservation and Recycling, 128, pp.78-89.

Photo credit: Paweł Czerwiński on Unsplash
Photo credit: Zbynek Burival on Unsplash
Photo credit: Ryoji Iwata on Unsplash

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