China’s coal rush: why the West has no business judging Beijing

China is committed to carbon neutrality by 2060 but, in the short term, Beijing simply has to address an energy shortfall and keep the lights on
By moving manufacturing to China, the West has offshored some of its carbon emissions. It is not in a position to criticise Beijing

Neal Kimberley

Published: 2:30am, 20 Oct 2021

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A spirit of cooperation prevailed at COP15, the United Nations Biodiversity Conference that ended last week in Kunming. Attention will now switch to COP26, the UN Climate Change Conference, opening in Glasgow on October 31. China’s economic heft means Beijing’s stance will be critical if COP26 is not to be seen as a cop-out but expectations need to be grounded in reality.

China is committed to achieving carbon neutrality by 2060 but, in the short term, amid a post-pandemic global economic rebound that has resulted in a worldwide energy crunch, policymakers in Beijing know that their first priority is to keep the lights on and homes heated.

If that means greater short-term reliance on carbon-emitting energy, including coal, then so be it. That clearly doesn’t sit well with the COP26 agenda and its emphasis on countries signing up for “ambitious 2030 emissions reductions targets”, but those who might be tempted to criticise China should think twice before doing so.

After all, Western consumers continue to rely on vast amounts of well-made and competitively-priced goods that are “Made in China”, while Western policymakers have been perfectly happy in recent decades to offshore manufacturing to China, thus essentially offshoring some of their own economies’ carbon emissions in the process.

So, anyone that might be considering aiming Greta Thunberg’s famous “How dare you” refrain at China should hold fire.

02:40

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In truth, there is no reason to believe China will not pursue efforts to reduce its carbon emissions. After all, China is just as exposed as any other country to climate change.

Future rises in sea level would inevitably pose a threat to China’s eastern seaboard while recent research has highlighted how higher temperatures on the Qinghai-Tibet plateau could ultimately destabilise water supplies.

But for now, Beijing simply has to do what Beijing has to do to mitigate the impact of the energy shortfall. Yet, in China, and the rest of the world, it seems renewable energy sources cannot easily fill the gap, which necessitates recourse to fossil fuels, including coal, to address an immediate energy crisis.

Indeed, China has had to ramp up the production, importation and use of coal, the “dirtiest” of fossil fuels in terms of carbon emissions, to generate the electricity that the Chinese economy urgently needs.

That’s not desirable, and it doesn’t do anything for perceptions of China’s green energy credentials, but it is unavoidable, particularly given that coal remains an integral part of China’s current energy mix.

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Yet, at the same time, Beijing is using the current energy crisis to push through some profound changes to make the Chinese economy more energy efficient.

China’s National Development and Reform Committee has unveiled measures that will liberalise pricing in the state-controlled power market and will abolish the direct power purchasing scheme that previously kept energy costs artificially low for big industrial users.

As industrial and commercial users start to buy electricity at market prices, this should ultimately favour those who adopt a more energy-efficient business model.

Meanwhile, China, already a world leader in renewable energy production, has every intention of going even further. In his keynote speech, delivered via video link, at COP15, President Xi Jinping stated China would continue to “vigorously develop renewable energy”, and intended to speedily develop large wind power projects and photovoltaic bases around the country.

“Construction of the first phase of projects with an installed capacity of about 100 gigawatts started recently,” Xi said. That’s ambitious.

In comparison, US President Joe Biden last week announced plans for seven major offshore wind farms to be located off both the east and west coasts of the United States and further out in the Gulf of Mexico, intended to deliver some 30 gigawatts of offshore wind energy by 2030.

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Nor is China ignoring the intermittency issue that affects the reliability of solar and wind power. After all, the wind doesn’t always blow and the sun doesn’t always shine.

It might not play well with renewable energy purists who harbour strong reservations about nuclear power generation, but China continues to invest in new nuclear technologies, such as Hualong One and Guohe One, that will provide steady sources of non-carbon-emitting energy.

COP26 looms and although, right now, China needs fossil fuels to address an immediate energy shortfall, that doesn’t mean Beijing is backsliding on its commitments to addressing climate change.

It just means Beijing knows it has to keep the lights on and ensure homes are heated.

Neal Kimberley is a commentator on macroeconomics and financial markets