670,000 smog-related deaths a year: the cost of China's reliance on coal

Smog caused by coal consumption killed an estimated 670,000 people in China in 2012, according to a study by researchers that tries to put a price tag on the environmental and social costs of the heavy reliance on the fuel.

Damage to the environment and health added up to 260 yuan (HK$330) for each tonne produced and used in 2012, said Teng Fei , an associate professor at Tsinghua University.

The 260 yuan is made up of two parts: the health cost and the environmental damage caused by mining and transporting coal.

"With existing environmental fees and taxes of between 30 to 50 yuan for each tonne of coal, the country's current pricing system has largely failed to reflect the true costs," Teng said.

Tiny particulate pollutants, especially those smaller than 2.5 micrograms (known as PM2.5), were linked to 670,000 premature deaths from four diseases - strokes, lung cancer, coronary heart disease and chronic obstructive pulmonary disease - in China in 2012, Teng said.

That translated to an external cost of 166 yuan for each tonne of coal consumed. Authorities levied only about 5 yuan as a pollution fee per tonne of coal used by consumers including power companies and iron, steel and cement producers.