4 December 2014

CHINA PLEDGE TO HALT GREENHOUSE GAS EMISSIONS MAY PUT CAP ON COAL – ANALYSIS

By Michael Lelyveld

China’s pledge to halt the growth of greenhouse gas emissions by 2030 has raised questions about when it will cut its consumption of coal.

On Nov. 12 in Beijing, Presidents Barack Obama and Xi Jinping issued a landmark joint statement, setting new goals for the United States and China to fight climate change.

Under the agreement, U.S. carbon dioxide (CO2) emissions would drop 26-28 percent from 2005 levels by 2025.

The goal would require the United States to double the pace of average annual CO2 reductions from its previous projections for 2020, made in 2009, the White House said.

For its part, China agreed to hit a peak in CO2 emissions “around 2030,” making “best efforts” to reach a plateau before then.

China would also raise the share of non-fossil fuels in its energy mix to “around 20 percent” by 2030, the presidents said.

In 2013, the country derived 9.8 percent of its energy from “zero-emission” sources, including solar, wind, nuclear and hydroelectric power, The New York Times estimated.

China’s earlier goal set in 2009 called for cutting 40-45 percent of CO2 emissions from 2005 levels by 2020, but that reduction was to be measured per unit of gross domestic product (GDP).

The standard was widely criticized because total volumes of emissions were still allowed to grow as China’s economy expanded at high annual rates.

Last week, Xie Zhenhua, vice chairman of the National Development and Reform Commission (NDRC) planning agency, said China’s per-unit carbon emissions had dropped 28.56 percent as of 2013, the official Xinhua news agency reported.
Tough targets

The new targets are deliberately tougher on both sides, recognizing the importance of curbing emissions in the two countries, which accounted for 42 percent of the world’s CO2 last year, according to the Global Carbon Project, an international research organization.

Regardless of the challenges, advocates have been heartened by the coordination between the United States and China after years of mutual blame.

“If the two biggest players on climate are able to get together from two very different perspectives, the rest of the world can see that it’s possible to make real progress,” said Timothy Wirth, vice chairman of the United Nations Foundation, as quoted by Reuters news agency.

But the pledges have raised a host of questions, since they only provide partial information on policy endpoints without critical details on how they can be achieved.

On the U.S. side, the trend may already be putting emissions on track with policies including higher mileage requirements for new vehicles, tougher rules for power plants and energy efficiency standards.

Although more must be done to reach the new goal of 2.3-2.8 percent annual reductions after 2020, the United States has already lowered emissions by 10 percent from 2005 as of last year, as charted by Global Carbon Project data.

Over the same period, China’s volume of CO2 has climbed 72 percent to a level 90 percent higher than that of the United States, although its emissions are still 56 percent lower on a per capita basis.

One hopeful sign is that the two leading emitters now appear to be downplaying arguments about whether developed or developing nations are more at fault for global warming, while their joint statement cites “the principle of common but differentiated responsibilities.”
Missing numbers

Even so, a number of unanswered questions may determine the value of the diplomatic breakthrough.

While China’s new pledge is seen as significant, it begs the question of how high its peak emissions will be and whether their growth will swamp reductions in the United States and perhaps the rest of the world.

Michael Levi, senior fellow for energy and the environment at the Council on Foreign Relations in New York, said that key numbers for the climate crisis are missing from China’s target.

China has yet to quantify its goal for future CO2 emissions in absolute terms, measured in millions or billions of tons.

“What we have now is, we have a peaking year, which people have been asking for, for a long time, but we have no idea at what level the Chinese envision peaking,” Levi said in a call-in session for reporters.

“You can peak in 2030 at 15 percent above current levels. You can peak in 2030 at 30 percent above current levels,” he said.

The difference is crucial to what China’s pledge really means.

The world may get a clue when China announces new “carbon intensity” targets in preparation for an international climate conference in Paris next year.

But even then, the intensity index, which tracks carbon content per unit of GDP, would only suggest how much CO2 may be released if the amount of GDP growth is known for the next 15 years.

Another major missing piece of information is when China will reach a limit on its consumption of coal, the single largest source of CO2 in the world.

China now relies on coal for 65.7 percent of its energy, the National Energy Administration said. The share is more than twice the global average for coal.

The country consumed 3.61 billion metric tons of coal last year, the China National Coal Association said in January, but other estimates range from over 3.7 billion to 4 billion tons.

The huge volume was over four times higher than U.S. coal consumption and more than the rest of the world combined, according to BP Statistical Review of World Energy and U.S. Department of Energy figures.
Timing questioned

A Tsinghua University study released two days after the joint announcement said China’s coal use should be “stabilized by around 2020″ in order to meet the 2030 emissions goal.

“An absolute decline in coal consumption should then occur as soon as possible,” said Teng Fei, a Tsinghua professor and study author, in a Xinhua report.

The 2020 date is a decade earlier than the peak coal demand forecast of the Paris-based International Energy Agency (IEA) in the “new policies scenario” of its annual World Energy Outlook.

The study, which has been in the works for the past year, was released within hours of the joint announcement, giving it little chance to reflect the new targets or policies.

But the 10-year difference between the IEA forecast and the Tsinghua study may be indicative of the challenges ahead for China in meeting its peak CO2 goal.

Although the IEA sees the annual growth rate of coal demand slowing markedly from the boom years of the previous decade, it projected a 13-percent increase in 2030 compared with 2012, implying consumption of some 4.3 billion tons.

Under the forecast, China’s CO2 emissions would peak only in 2035 after rising 21 percent above 2012 levels.

On Nov. 19, China’s State Council, or cabinet, announced a 2020 coal consumption limit of 4.2 billion tons as part of a five-year “energy development strategy action plan,” but it was unclear whether the cap could be raised after that.

Forecasts for peak coal timing and volume have varied widely, raising doubts about when China will stem the rise of CO2.

“To date, recent predictions have ranged from a period between 2015 and 2030 and at the level of 3.9-4.8 billion tons, an unbelievably broad range,” said Li Zhidong, a professor at Japan’s Nagaoka University of Technology in a report last month for the Seattle-based National Bureau of Asian Research.

In his paper, Li argues that demand for raw coal will top out at 3.9 billion tons as soon as next year, citing factors including slower economic growth, greater anti-smog efforts, higher energy efficiency, cleaner fuels and a shift from manufacturing to the service sector.

Such a pace would help China meet its 2030 goal for peak CO2, but it assumes progress on all fronts, and emissions would still remain high.

“Peak coal by 2020 may be possible, provided economic growth stays at current level or below, and they succeed in building all the dams, gas pipelines and nuclear plants that are planned,” said Philip Andrews-Speed, a China energy expert at National University of Singapore.
Global effect

Most experts doubt that meeting the targets would keep the rise in global warming below the limit of 2 degrees Centigrade (3.6 degrees Fahrenheit) urged by the United Nations to avoid the more serious effects of climate change.

But the best efforts of the United States and China could keep the damage from getting even worse.

“We need to eventually get CO2 emissions down to zero, but in the meantime it’s the exponential growth that’s our main enemy, since that boxes us in and leaves little time for decarbonizing the economy,” wrote University of Chicago professor Raymond Pierrehumbert on Slate.com.

Much may depend on how much China will reduce its coal burning after it reaches a peak.

Even under Li’s projections for peaking in 2015, the country’s raw coal demand in 2020 would be about the same as its level last year.

There are also signs that some of China’s biggest energy consuming industries are trying to meet government demands to cut overcapacity by boosting production outside the country, essentially exporting their pollution overseas.

On Nov. 18, Xinhua reported that heavy industries in northern Hebei province plan to transfer excess capacity abroad, shifting production of steel, cement and flat glass to regions including Africa, Southeast Asia and South America.

The strategy may curb the rise of home-grown emissions from coal-burning factories, but it may do little to reduce global totals of CO2.

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