Energy prices in China are at or above international levels. For example:
- Residents of Guangzhou pay $0.16/kWh, higher than San Francisco
- Natural gas prices in Guangzhou are $10/ mcf, same as San Francisco
- Coal prices cost $147/ ton, higher than the US
Energy Intensity and Carbon Savings
China has reduced it's energy intensity (amount of energy used per dollar of GDP) dramatically since 1980. Between 1980 and 2000, China's GDP quadrupled but energy use only doubled. This is good news. The central government has also committed to a 20% decrease in energy intensity from 2005-2010 and looks to be on track to achieve at least 2/3 of that goal.
Of course, absolute emissions levels have risen dramatically over that period, but the CO2 savings over what would have happened are remarkable. Thanks to the 20% energy intensity goal, China will save 1 billion metric tons of CO2 in 5 years. For comparisons sake, the EU's commitment under Kyoto will save 300 million metric tons. So, China has taken action, but it's important to note that the EU's commitment is an absolute reduction of CO2 emissions, while China's reduction is only relative to otherwise massive growth in CO2 emissions.
Energy Use per Capita
The really scary thing, though, is the graph to the right. China is currently at 1/8 of the US's level of energy use per capita. Based on what I've seen here in Beijing, as Chinese get wealthier, they will follow the US's model of higher energy consumption. If China were to use the same amount of energy per person that the US currently does, the additional emissions would equal 122% of the world's current CO2 emissions. I.e., if China starts using as much energy per capita as the US tomorrow, world emissions would double and then some.
Given that China (and India, Brazil, on down the line) will not give up their ambitions of wealth and the energy use that comes with it, it is imperative that economic growth and increased energy use become decoupled from carbon emissions. Bring on the disruptive technological change! (For more on this, see Green Leap Forward's interview with David Tyfield)
Coal Use and Reserves
As we all know, China has huge reserves of cheap, dirty coal and is not afraid to use it, right? Well, sort of. China only uses twice as much coal per capita as the US, but in light of the graph above showing that China only uses 1/8 as much energy as the US, it's clear that China is more dependent on coal and not yet using as much natural gas at the US for power. Importantly, China has only about 1/10 of the coal reserves of the US on a per capita basis, which means the US has about twice as much coal as China on an absolute basis.
The key takeaway from these statistics is that the US must lead the way on coal. The US is already a huge user of coal and has massive reserves of the stuff, and will likely show China the way on coal. Will clean coal become an option? Or carbon capture and storage? Or will disruptive technological change make coal obsolete? Likely it will be a blend of these three, but I would love to see cheap, clean energy beat coal at it's own game.
In Dr. Levine's view, "by any measure of contribution to atmospheric CO2, the Chinese have done far less harm than the United States." He points to the fact that the US is not only emitting more on a per capita basis now, but has been emitting far more for the past 100+ years. As you can see in the graph to the left, from a cumulative per capita perspective, US emissions far outstripped China's. Since CO2 emissions are persistent, Dr. Levine feels cumulative historic emissions is the most relevant data point for climate negotiations. Therefore, the US must take significant action on capping and reducing CO2 before China should be expected to do anything.
I am still deciding what I think about this argument over CO2 and who should be responsible for cleaning up. I think there are several things in favor of Dr. Levine's point, namely the graph above as well as the fact that many of the goods China produce ultimately get sent over the sea for us to consume. According to an Boston Globe op-ed by China environmental and social researcher Josh Muldavin, "the carbon dioxide embedded in China's exports to the United States in 2004 alone is estimated at 1.8 billion tons, equivalent to 30 percent of the US total." Wow.
But China Environmental Law blog (CELB) had a pretty interesting take on this stuff:
In the “myth busters” session we were treated to the fun you can have with numbers when you place 1.3 billion in the denominator. Apparently China has no bigger role to play in climate change negotiations than say, Botswana. But while were playing this game, the next time someone tells you how green China is and points to where China ranks with respect to total installed wind power (for instance), ask them how China compares with Germany or the US on a per capita basis.CELB also brought up the contradiction between China wanting to be seen as an international powerhouse when it suits it, but wanting to be treated like just any other developing country when it comes to climate change:
Does anyone think (regardless of who wins the election next Tuesday), that the US Senate will ratify a treaty that commits a recession-plagued US to a treaty where it must undertake real GHG reduction limits, while a growing economic power house like China (associated now in US public perception with a spectacular and lavish Olympics and a Shenzhou space program complete with vanity space walks) gets to continue to increase its GHG emissions and gets lots of money and free technology to boot?Both sides have a point. Climate change discussions will likely become the most critical element of US-China relations over the coming decades. Both sides need to give a little bit and stop waiting around for the other to act first, but obviously, given the overwhelming advantage in both GDP per capita and emissions contributions per capita, the US should move first and much, much farther than China in the near term.
Fundamentally, the current climate change stalemate is based on the prevailing view that carbon emission reductions inhibits economic growth. The "CO2 limits= reduced economic growth" paradigm needs to be innovated away. CO2 caps are important, but unless the heretofore existing link between CO2 and economic growth is broken, CO2 emissions won't be significantly reduced. Thankfully, the new model for economic growth is quickly becoming CO2 limits + innovation + massive investment in green infrastructure, technology and jobs = economic growth. Hopefully, Obama and Hu both grasp this and can find ways to work together and move past the old debate of who should give up growth.