China fights to rein in its globe-topping energy use (News Feature)

By Andreas Landwehr Aug 22, 2010, 4:02 GMT

Beijing - Rising economic powerhouse China is struggling to keep its hunger for energy in bounds.

It overtook Japan in the second quarter as the world's second-largest economy, falling behind only the United States, and has also become the number one consumer of energy, according to the Paris-based International Energy Agency.

The agency said recently that according to preliminary data, China, whose 1.3 billion people make it the world's most populous nation, had surpassed the United States in energy consumption after 'phenomenal growth in demand' over the past decade.

China's rise to the top ranking was faster than expected, the aggency said, because it was much less affected by the global recession than the United States, not to mention a host of other countries. The Chinese economy is currently growing at a rate of about 10 per cent annually.

The agency said China's energy demand had doubled since 2000, although on a per-capita basis, it was still about one-third of the average in the 32-nation Organisation for Economic Cooperation and Development (OECD).

While China disputes the agency's assertion that it is the world leader in energy consumption, economic growth is straining its energy resources.

This year's hot summer has boosted electricity consumption further as air-conditioning units run at full tilt. Power is becoming scarce in some areas. Many provinces have had to ration electricity to keep the lights from going out.

Power to about 500 energy-intensive enterprises in Anhui province in eastern China was cut off last week for a month. The blackout was officially described as punishment for failure to meet the energy conservation and emission-reduction goals set by the provincial government.

The Zhongcheng Cement Factory in Huaibei with an annual production of about 1 million tons reportedly learned of the cutoff just two days in advance.

'We are anxious because we will not be able to complete several orders,' the China Daily newspaper quoted factory manager Sun Yangzhi as saying. The factory's 700 employees are to be paid reduced wages for a month while they do maintenance work.

Other provinces are also taking strict measures that they trumpet as climate protection. They are making a virtue of necessity, however.

For one thing, they are responding to the summer power shortage by cutting back where it pays off most. Secondly, the entire country is poised for the final push to meet the goal that China set itself five years ago: to reduce its energy intensity, calculated as units of energy per unit of gross domestic product (GDP), by 20 per cent by the end of 2010.

China's economic stimulus programme and massive lending by state banks have given the economy such a big boost that the goal might not be reached. In the past four years, energy consumption per yuan of GDP has fallen by 14.8 per cent. But it rose by 3.2 per cent in the first quarter of 2010, prompting the government to give the green light to 'drastic measures,' such as cutting supplies to power guzzlers and ending subsidies.

The signal is clear: The plan must be met. At stake is China's credibility. Last year in Copenhagen at a UN climate change conference, China, the world's largest emitter of greenhouse gases, promised to reduce its energy consumption per unit of GDP by 40 to 45 per cent by 2020 compared with 2005.

But even this might not be enough. China's energy consumption and emissions of greenhouse gases would continue to rise in absolute figures because its economy is likely to keep growing strongly.

Chinese scientists forecast if China continues to develop as it did in the past decade, more than half of the energy consumed in the world would be on its account in 2020. They are pressing for 'drastic changes.'

China has not been sitting on its hands. It has turned into the world's leading producer of solar installations and wind turbines and has more hydroelectric plants than any other country.

By 2020, China aims to draw 15 per cent of its energy from sources other than fossil fuels. To accomplish that goal, it is also pushing nuclear energy. Nowhere in the world are more nuclear power plants under construction or planned.

But China's baneful dependence on coal, the source of two-thirds of its energy, would remain in the foreseeable future because of steadily growing demand - with consequences for the rest of the world.

In the view of The Climate Group, an independent, London-based non-profit organization, 'The sheer scale of growth in China will require energy resources that outstrip available conventional sources.'