Government Enforcing Energy Conservation Targets

China consumes more energy than any other nation in the world. As the world’s top producer of carbon dioxide and other harmful gases, China must be part of the solution in the global fight against climate change.

Unfortunately, electricity consumption in China is up more than 1,000 percent since 1990. Demand has been growing by nearly 8 percent per year since 2010. China now consumes more energy than the United States and India combined. The majority of energy is still derived from oil and coal. Due to its dependence on dirty fuels, energy production and consumption in China generated more than 9,528 megatons of CO2 last year (a 350 percent rise since 1990).

On the bright side, renewable sources in China gained market share in 2020. Renewable energy sources now meet about 29 percent of total demand, while coal is still used to generate about two-thirds of the energy today.

In 2021, China has added more coal power than ris generated by the entire European Union. As a result, China’s share of global coal generation rose from 50 percent in 2019 to 53 percent. During the same period, China was responsible for 90 percent of the world’s increase in electricity demand and 43 percent of the world’s increase in wind and solar during this period.

Under the Paris Climate Accord, China committed to reach their peak levels of carbon emissions by 2030. The world cannot achieve peak coal until China turns the tide on dirty energy.

In a glimmer of hope, China’s President Xi Jinping announced in late 2020 that the country would cut its carbon dioxide emissions per unit of gross domestic product, or carbon intensity, by more than 65 percent by 2030. He also pledged sharp increases in renewable energy capacity.

China is facing a shortage of coal supplies, toughening emissions standards and strong demand from manufacturers and industry. Coal prices have reached record highs. One challenge for Beijing is its ongoing trade dispute with Australia, which has cut coal shipments to China. Another factor is a global shortage of natural gas. Now, the nation faces widespread curbs on power consumption.

China’s industrial companies have faced unpredictable surges in power prices and availability since March, when provincial authorities in Inner Mongolia ordered heavy industry to conserve energy. In May, manufacturers in the southern province of Guangdong were ordered to curb consumption as a combination of hot weather and lower than usual hydropower generation strained the grid. Other major industrial zones along China’s east coast have also experienced consumption caps and power cuts. Yunnan province is canceling electricity discounts for aluminum producers. Residential users also have been asked to cut back.

Despite these modest efforts, only 10 out of 30 Chinese regions achieved their energy reduction targets in the first six months of 2021. China’s total power generation through August of 2021 was actually 10.1 percent greater than in the same period in 2020, and nearly 15 percent more than in the same period in 2019. Along with the higher power generation came higher toxic emissions, which surpassed pre-pandemic levels.

In response, the regulators announced tougher penalties for regions that fail to meet their conservation targets. Local officials are responsible for limiting energy demand in their regions.

Local governments in Zhejiang, Jiangsu, Yunnan and Guangdong provinces have asked factories to limit power use. Some power providers advised heavy users to either halt production during peak power periods or shut operations entirely for two to three days a week. Others have been closed until further notice. At least 15 publicly traded Chinese firms have reported that their production has been disrupted by power cuts. Residential users also have been asked to conserve, with households in parts of northeast China told to limit use of water heaters and microwaves to conserve power. Consumers at restaurants are dining with flashlights.

The State Grid Corporation of China said that it would take comprehensive measures to meet demand. Will it keep building new coal plants in its own country? Will it continue financing the building of hundreds more abroad? The battle against global warming and climate change must include China. I predict that it will emerge as a leader in many ways.

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