China beyond Copenhagen: energy and climate change policy · 2017-01-20 · China beyond...

China beyond Copenhagen:

energy and climate change policy

Bram Buijs

21 May 2010, Milan

IEFE / Bocconi University

Clingendael International Energy Programme www.clingendael.nl/ciep


Presentation content

Copenhagen COP-15

China’s pivotal role in addressing climate change

Energy and climate policy in China

Questions and dilemma’s


• Copenhagen Accord: no binding treaty.

• No solution on the debate how to follow up on the Kyoto Protocol. Two-track negotiating system (AWG-LCA / AWG-KP) still in place.

• 2° C limit as goal, but no global emission reduction targets; let alone global emission reduction targets split up by developed/developing countries.

Copenhagen COP-15


• Instead: ‘bottom-up’ commitments in 2 appendices: “quantified economy-wide emission targets for 2020” and “nationally appropriate mitigation actions for developing country Parties”.

• Climate finance commitments: $30bn fast-start fund in coming 3 yrs and $100bn per year by 2020 for adaptation and mitigation.

• Very minor steps on MRV(measurable, reportable, verifiable requirement).

Copenhagen COP-15


• Pledges even at the high range (and implemented successfully) are not enough to give a 50 percent chance on limiting the temperature increase to 2 degrees (perhaps not even 3 degrees).

• What next? What to expect from COP-16 in Mexico?

• What to think about’s China role? And in the future?

A Failure?

Image source: Financial Times, 2009



Copenhagen COP-15





Source: International Energy Agency, WEO2008


Global energy-related CO2 emissions: 1990

U.S.26%

Europe23%China

8%India1%

ROW42%


Total:

20.95 billion tons of CO2


Global energy-related CO2 emissions: 2006

U.S.20%

Europe15%

China20%

India5%

ROW40%


Total:



Global energy-related CO2 emissions: 2030 (IEA projection)

U.S.14%

Europe10%

China29%India

8%

ROW39%

Source: International Energy Agency, WEO2008, Ref. Sc.

Total:



China’s energy system – the fundamentals

Coal70%

Hydro, Nuclear,

Wind7%

Crude oil20%

Natural gas3%

1.44

4.7

China OECD

Primary energyconsumption

(toe/per capita)

Structure of primary energy consumption


A. Power generation sector

• 24% of total GHG emissions worldwide.• In China, 47% of total emissions.

• Rapid expansion: 3 to 4 large (500 MW) coal-fired power plants each week, in a three year period up to the economic crisis.

• .....increasing annual emissions with 9-12 millions tons of CO2

In comparison: achieving Europe’s Kyoto target would save about 342 millions tons of CO2

Crucial sectors

Image source: www.msnbc.msn.com


B. Buildings / residential sector

• 30-40% of total energy use and emissions in developed countries.

• In China, 9% of total emissions.

• Half of all housing worldwide is being built in China (± 2bn m2 /year).

• Building energy efficiency is far below Western standards.

Crucial sectors

Image source: Fotosearch.com


C. Transportation

• 34% of GHG emissions in the U.S.• In China, only 5% of total emissions.

• In China out of one thousand people, only 24 own a car, comparedto about 500 in Europe and 760 in the United States.

• Since January 2009 car sales in China are exceeding those in the United States: China is now the largest market for automobiles.

Crucial sectors

Image source: Business Week


Passing opportunities...

McKinsey report China’s Green Revolution (February 2009):

• Full implementation of mitigation measures could reduce China’s GHG emissions in 2030 by 46 percent compared to BAU.

• a 5 year delay in implementation would lead to a loss of one third of the total abatement potential.

• a 10 year delay would mean losing 60 percent of the potential.


Main challenge...

finding a new

developmental path....

Source: World Energy Council2009, adapted from Shell Scenarios



Copenhagen COP-15





China is implementing very strong policy measures to stimulate renewable energy and energy efficiency

Main drivers:

• energy security concerns: rising import dependency for oil and gas, coal supply constraints

• environmental issues: air pollution and acid rain, potential climate change effects

• economic opportunities: in renewable energy sectors and low carbon industriesImage source: China Daily


China is implementing very strong policy measures to stimulate renewable energy and energy efficiency

Targets for 2005-2010:

• 20% reduction of energy intensity (i.e. energy consumed per unit of GDP), estimated to save 1.5 billion tons of CO2 per year by 2010.

• Ambitious growth targets for renewable energy. China is already the world’s largest producer of renewable energy due to its large amount of hydropower.

• Implementing energy conservation programmes, such as Top-1000 Enterprises Programme to save energy at largest industrial energy users.

Image source: China Daily


China’s commitments in the run-up to Copenhagen

• Decarbonizing the economy, by lowering emissions of CO2

per unit of GDP by 40-45% by 2020 compared to 2005.

• Increasing the share of non-fossil fuels, i.e. renewable energy and nuclear energy, in primary energy consumption to 10% by 2010 and 15% by 2020.

Image source: China Daily


• China has established feed-in tariffs to stimulate renewable energy (wind/solar).

• Introduction of renewable portfolio standards that require power/grid companies to purchase renewable energy.

• China has set fuel efficiency standards for cars following European example (already stricter than the US).

European policy-making sometimes acts as an example for China


Stimulating hydro energy….

Three Gorges Dam: 22.5 GW = 1/4 of United Kingdom total electricity generating capacity

Image source: www.etravelblackboard.com


In wind power already a big player….

Total installed capacity for wind power, end 2009

Global total 158 GW. China is the world no. 3 with 25.1 GW (16%)

Image source: Global Wind Energy Council, 2010


…. and getting even bigger

Newly installed capacity for wind power in 2009

Global total 37.5 GW. China is the world’s largest with 13 GW (34.7%)

Image source: Global Wind Energy Council, 2010


New Energy Finance / UNEP, Global Trends in Sustainable Energy Investment 2009 report:

“Financial investment in developing countries increased to $36.6 billion in 2008, an increase of 27% on 2007, whilst investment in developed countries fell by 1.7% to $82.3 billion. China led investment in Asia, with $15.6 billion of new investment.”

Strong growth of clean energy in China in spite of financial and economic crisis


0

400

800

1,200

1,600

2,000

2,400

2,800

1980 1985 1990 1995 2000 2005

China's Electricity Production by Source(billion kilowatthours)

Conventional Thermal (97% coal)

Hydro

Nuclear

Geothermal, Solar, Wind and Biomass Electric Power

However, a huge challenge remains…

Source: U.S. Energy Information Administration



Copenhagen COP-15





Economic considerations seem to clash more and more with climate change objectives, especially in the case of China:

• Carbon leakage and unfair competition concerns -> carbon border taxes/tariffs?

• Are we willing to fund mitigation actions in China?

- discussion on funding within COP-15

- discussion on CDM funding for wind energy in China…

Example of wind sector development in China

Economic competitiveness vs

climate objectives?

Image source: CRESP, 2009


Wind in China:

Strong Chinese industrial policy

Localization requirements

Market share foreign companies declining

Increasing competition and shifting balances…


• How ambitious is it? Diverse opinions…

• Baseline scenarios by IEA and EIA already incorporate very strong energy/emission intensity improvements:

IEA, World Energy Outlook 2009 Ref. Sc.: 37% decrease in Chinese carbon intensity over 2007-2020.

EIA, International Energy Outlook 2009: decline of 44% between 2006-2020.

• Can China achieve it?

What to think of China’s

carbon intensity target?


What to think of China’s

carbon intensity target?

What is required according to IEA 450 ppm Scenario

Source: IEA, World Energy Outlook 2009


Questions on:

- UN process/procedures too cumbersome and complex?

- What will happen in the United States on energy/climate legislation?

- Are carbon border taxes/tariffs going to be established?

• Still no solution on how to follow up on the Kyoto Protocol.

• Pledges are still insufficient according to climate science.

What future for an international

climate treaty?

Thank you!

Reports available for download at www.clingendael.nl/ciep


http://www.clingendael.nl/publications/2009/20090900_ciep_report_buijs_china_copenhagen_beyond.pdf

China beyond Copenhagen: energy and climate change policy · 2017-01-20 · China beyond...

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Transcript of China beyond Copenhagen: energy and climate change policy · 2017-01-20 · China beyond...