The consumption of coal in China is on the decline, despite economic growth, showing the country is making efforts to combat climate change….A special report by Vishal Gulati for Asian Lite News
The 2016 Statistical Communiqué on Economic and Social Development released by China’s National Bureau of Statistics last week, said China’s electricity sector transformation continued over 2016. With coal consumption down 4.7 percent in 2016, the data also confirms that China is now more than three years past its 2013 peak in coal.
“Energy demand has decoupled from economic activity, and when this is combined with record annual renewable energy installations, China continues to diversify away from coal faster than anyone expected,” said Tim Buckley, the Energy Finance Studies Director with the Institute for Energy Economics and Financial Analysis (IEEFA).
IEEFA conducts research and analyses on financial and economic issues related to energy and the environment.
The Chinese report says solar and wind capacity grew dramatically; solar increasing by 81.6 per cent to 77 GW in 2016 and wind growing 13.2 per cent to 149 GW.
But problems remain, as electricity from renewables is unable to be evacuated to the grid adequately. In total, 57.1 TWh generated by wind and solar was wasted last year, equivalent to the total annual generation of Denmark and Ireland in 2015.
United Nations Environment Programme (UNEP) Executive Director Erik Solheim is optimistic about the energy landscape transformation in China — one of the world’s fastest-growing economies.
“On China, I’m optimistic. There are bold targets and huge challenges but we’re also seeing enormous progress. A fundamental shift has taken place in Chinese thinking. China is not only concerned with economic growth but also the quality of that growth,” he said.
Solheim said in a recent interview that corporate sourcing of renewable electricity can be a major driver of the transition to a robust, zero-emissions economy.
“What we are hearing time and again from the private sector is that they consider carbon pricing to be an increasing certainty. More and more companies feel they need to begin right now to factor this into their way of doing business.”
Solheim said RE100 grouping of the world’s most influential companies committed to 100 percent renewable power reflects this new way of thinking.
“I’m convinced that this will kick off a wider trend where all companies will not be able to afford to ignore the sustainability of their operations. In addition, this will help grow demand for renewable energy, which in turn will drive innovation and redirect investment away from fossil fuels.”
“As the market is pushed to maturity, prices will come down. Renewables will become the new standard,” Solheim added.
IEEFA’s Buckley said China has exceeded all expectations with its investment in renewable energy capacity, once again breaking its own world record for installation. The pace of growth and the decline in cost, he said, are extraordinary.
China plans to invest $360 billion in new renewable energy capacity by 2020, driving new employment and technology development.
Interestingly, coal imports by China has increased by 25 percent.
China’s net coal imports in 2016 were 255 million tonnes, an increase of 25.2 percent on 2015, says the Chinese National Bureau of Statistics.
Imports had previously declined in 2014 (minus 11 percent) and 2015 (minus 30 percent), but rebounded in 2016 as a result of a Chinese government policy to reduce overcapacity in the domestic coal sector, which significantly reduced domestic coal production.
On expectations from India in achieving this target, UNEP head Solheim said with commitment and leadership, then yes.
“I was enormously encouraged to see India’s rapid ratification of the Paris Agreement (in October 2016). We have to remember that we’re in the midst of a revolution here. Five or 10 years ago, the kind of commitments and changes we are seeing today in India would have been unimaginable. But here we are today — with bold targets, a clear commitment and what I’m convinced is sincere leadership.”
India’s Intended Nationally Determined Contribution (INDC) submitted for the Paris COP21 Climate Agreement is committed to source 40 percent of its electricity from non-fossil fuel sources by 2030.
“We’re also seeing unprecedented engagement by India’s private sector, not only locally but also regionally and internationally. I’d go as far as to say that India could quite feasibly surpass its targets,” he said.
According to the draft National Electricity Plan prepared by the Central Electricity Authority, India does not need any coal power capacity addition for 2017-2020 and beyond.
By 2027, India aims to have 275 GW of total renewables, plus 72GW of hydro and 15GW of nuclear.