by Ignazio Musu[1]
Energy has been the foundation of China’s extraordinary economic growth; China overtook the United States to become world’s largest energy consumer and now it represents almost 25 percent of the world’s energy consumption.
China’s economy is still based for 86% per cent on the use fossil fuels; 60 percent of China’s total energy relies on carbon, 20 percent relies on oil, and only 6 percent on natural gas; it increasingly depends on imports of fossil fuels as in the past few years, it has imported more than 70 per cent of its crude oil and more than 40 per cent of its natural gas.
The reliance of Chinese economic growth on fossil fuels energy has implied an increasing trend of CO2 emissions; China continued its yearly emissions of CO2, overcoming, since 2006, those of the United States to become the world most important country emitting greenhouse gases; CO2 China’s emissions per unit of GDP are one and a half higher than those of the US; in 2019 China’s greenhouse emissions overcame those of all the developed countries jointly considered.
Commitment to research and investments towards a low-carbon economy started in China since the 11th 2006-2011 Five Year Plan; low-carbon related research and investments have been undertaken by a number of state institutions and by private institutions with a strong support of the government; in 2020 China invested in clean energy almost twice the amount of money invested by US.
Generation of solar and wind power has been continuously increasing, but the most important factor of the presence of China on the international stage towards a low-carbon economy is its now being biggest world producer of batteries, that allow to storage energy thus dealing with intermittent solar and wind energies.
China controls 90 percent share of the global production of rare earths and critical metals (such as copper, graphite, lithium, and cobalt) required to produce batteries; Chinese companies have invested in mines in the Democratic Republic of Congo (DRC, cobalt), Chile and Argentina (lithium), and other countries; and only recently a fight started by western countries to contrast China’s domination in the field.
CATL (Contemporary Amperex TechnoLogy) in Fujan became the largest world batteries producer, covering one third of the world’s market, and the United States seems to depend on China’ technological advances in components for batteries, such as lithium, after the price of another batteries’ component, nickel, more than doubled in the past years.
Tesla, the largest US electric vehicles producer, uses Lithium Iron Phosphate or Lithium Ferro Phosphate (LFP) batteries supplied by CATL for its cars sold in China, expanding the use to cars sold in the US; Ford also announced that it will use technology from CATL to make LFP batteries.
The pace of China’s emissions reductions over the coming decades will be crucial in determining whether the world will succeed in preventing global warming from exceeding 1.5 °C over the early 20th century.
In 2020, President Xi Jinping announced that China will aim at a CO2 emissions peak before 2030 to achieve carbon neutrality before 2060; as an application of this strategy, China committed at the United Nations General Assembly in September 2021 to discontinue building coal-fired power projects abroad and to step up support for clean energy.
An expression of Chinese willingness to seriously address the climate change challenge is the study “An Energy Sector Roadmap to Carbon Neutrality in China”, committed by the Chinese government to the International Energy Agency (IEA) and published in 2021; the study has been prepared with the cooperation of many Chinese researchers and Chinese research institutions.
According to the IEA scenario, by 2060 the contribution to energy of the fossil fuels will be drastically reduced to 25 per cent: coal’s contribution will shrink to 3 per cent (from the actual 57 per cent); oil’s contribution will shrink to 8 per cent (from the actual 20 per cent); only gas’s contribution will grow to 14 per cent (from the actual 8 per cent).
On the contrary, according to the IEA scenario, to contribution to energy of renewable energy sources will heavily increase: by 2060, the contribution to energy of solar power will rise to 22 per cent (from the actual 1 per cent), of wind power will rise to 17 per cent (from 3 per cent); also, nuclear energy will rise to 8 per cent (from the actual 2 per cent).
The last China’s Five Year Plan accepted the outcomes of the IEA document; but clearly these target will not be at all easy to be achieved, even if in 2024 China is expected to account for half of the world’s new solar power projects, and almost three quarters of the world’s wind projects.
China is now accounting for half the renewable energy capacity added worldwide, but it China continues to remain the dominant world source of CO2 emissions mainly because it continues to be the world’s largest producer and user of coal.
President Xi Jinping has recently confirmed China’s commitments to reducing emissions and reaching carbon neutrality, but he also declared that the path towards this goal, the manner, pace and intensity of efforts to achieve it, should be decided by China according to its means.
China’s energy security, which recently intensified because of the US-China tensions, plays a crucial role in determining this path, together with the perception that the huge effort in developing batteries and energy storage systems to face the intermittency of solar and wind energy still do not seem to have reached the appropriate level in terms of infrastructures and flexible grids.
Until now China has successfully reacted to the tech war with the US particularly in the field of solar energy; Chinese companies have been subject to US and EU tariffs for dumping solar panels on the international market, but the impact of these restrictions on China remained limited.
The recent US Inflation Reduction Act includes heavy subsidies for manufacturers of solar panels; the EU is likely to spend more than US on subsidies to solar; but these measures do not seem to have had a significant impact on Chinese dominant position in the field.
As a reaction to US and western measures, China is also considering restrictions on exports of technology to produce materials for renewable energy; an example is given by the recent measures to block rare earths such as gallium and germanium, used in producing solar panels.
But further tensions (particularly between China and US, but also between China and EU), continuing to push for competition in technological innovation, may end up in compromising further efforts of China towards building a low-carbon economy; the disappointing results of the recent Conferences of Parties (COPs) of the United Nation Framework Convention on Climate Change (UNFCCC) confirm a very risky and dangerous situation.
On the contrary, all countries should be aware that without an international cooperation, a successful dealing with the challenge of climate change is increasingly unlikely to take place.
The issue of climate change confirms that the only way to avoid the Thucydides trap is a relationship between the United States and China which remains competitive but not at a point to prevent cooperation when it is required on shared interests; and the fight to climate change to build a low carbon economy is a crucial example of these shared interests.
[1] Ca’ Foscari University of Venice,
