China, Coal and Climate Change: Reasons for Optimism?

“What’s the point in the west acting on climate change? Isn’t China building a new coal power plant every week?”

How many times have you heard this? As well as being a casual conversation stopper, this narrative is a powerful argument for caution or inaction in developed countries. What’s the point of cutting our carbon emissions, this argument asks, if we end up being out-competed by an endlessly growing, high-carbon China? Particularly in the US, but also in Europe, this line of thinking has had the effect of blocking moves that would help to advance a global deal on climate change.

So are these proverbial coal plants actually being built at such a rate? Activists often point to the high rate at which China is closing down older, less efficient coal plants, but in net terms 50GW of coal-fired generation capacity was added during 2012, easily equivalent to one plant per week. The IEA estimates that coal generation will expand by 600GW by 2035. According to BP, in 2013 China accounted for more than half of the world’s coal consumption for the first time.

But this is not the whole picture. While it is true to say that China continues to rapidly expand its use of coal, it would be entirely wrong to suggest that the country is ignoring or opting out of global efforts to transition to a lower-carbon future. China’s most recent five-year plan, covering the period 2011-2015, places a significant emphasis on the development of clean energy and low carbon industries. The investment levels in renewable energy and electricity grid renewal match or outstrip what is being done in the EU. In fact China is the world’s largest investor in clean energy, increasing its investment levels by 20% in 2012, a year which saw major drops in investment in the United States and Europe.

More recently, the news that China was considering moving to an absolute cap on emissions was greeted with glee by climate activists. The move was hailed as a potential “game changer” that could unlock negotiations towards a global climate deal. Such a shift by China would put pressure on other countries, particularly the USA, to commit to more ambitious action on emissions.

The news was based on reports in the Chinese media, picked up by the Financial Times and London Independent among others, that China’s National Development and Reform Commission, the powerful government economic planning body, was recommending moving from carbon intensity targets towards absolute national caps on emissions. Such a move would take effect from 2016, the start date of the next five-year plan. Given the NDRC’s central role in the economic planning process, it was assumed that such a proposal would receive the backing of the State Council, and that China was getting ready to shake up the international negotiations.

Once the latest round of talks got underway in Bonn, however, Chinese negotiators dampened the speculation by stating that they were sticking with carbon intensity targets and would not be bringing any proposals for a cap to the negotiations. The country’s chief negotiator Su Wei pointed out that reports were based on the views of an expert working within the NDRC, and did not necessarily represent the views of the government or indeed of the NDRC itself. However the fact that the idea was floated in the Chinese press is probably not without significance.

In any case, China is already rolling out cap-and-trade schemes on a pilot basis in seven regions of the country. These schemes will cover up to a billion tonnes of CO2 and could potentially be the basis of a national emissions trading scheme in the future. In the meantime, however, there are fears that regions in the pilot schemes will simply “outsource” their emissions to less developed regions of the country.

At their informal summit in California earlier this month, US President Obama and Chinese President XI Jinping agreed to take action on reducing emissions of one particular class of greenhouse gases, hydrofluorocarbons (HFCs). The agreement sidesteps the UNFCCC process by proposing to work through the 1987 Montreal Protocol, which was aimed at protecting the ozone layer. HFCs are not ozone-depleting substances, but they are in increasing use as replacements for other substances such as chlorfluorocarbons (CFCs) which are being phased out under the Montreal Protocol. The idea behind the US-China agreement is to use the expertise and institutions built up under Montreal to reduce HFC emissions.

HFCs are one of a class of greenhouse gases known as short-lived climate pollutants or forcers (SLCPs), which are important contributors to global warming. In the aftermath of the last COP at Doha I wrote about the potential of multilateral, multi-level, voluntary initiatives such as the Climate and Clean Air Coalition to Reduce Short Lived Climate Pollutants (CCAC) to deliver quick wins in terms of slowing global warming. However HFCs account for only a small portion of this potential benefit. The agreement between the US and China talks about eliminating 90 gigatons of CO2 equivalent by 2050. Climate modeller Chris Hope estimates that this would translate into a reduction in global mean temperature by 0.04 degrees Celsius.

The agreement with the US on HFCs is at least symbolically important, and could pave the way for greater involvement by China in other initiatives to cut SLCPs. It also signals that both China and the US are seeking opportunities to demonstrate action on climate change, even if they lie outside the mainstream at present.

None of these hopeful signs demonstrate that China can break its dependence on fossil fuels. However they do show that China is engaged with the climate challenge and, like the rest of us, struggling in its own way to combine the imperatives of transition to a low-carbon future with its own economic and competitive interests. China is hardly the only country to be working through policy contradictions: the spectacle of the European Union risking a trade war with China over imports of cheap solar power cells of all things is hardly the best example of policy coherence on our part.

So while it would be wrong to talk about “Green China” it would be equally wrong to succumb to the myth that China continues to drive headlong towards a high-carbon future without any consideration for environmental limits. We shouldn’t oversell the progress China is likely to make but neither can we use the challenge of a developing China as an excuse for inaction.

This post was written for the IIEA‘s Environment Nexus web site. View the original post

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