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Energy Efficiency and Sustainable Development in China. Professor Shujie Yao and Dr Dan Luo School of Contemporary Chinese studies University of Nottingham. Outline. Can China sustain its fast growth? What is the implication on environment? Energy consumption & growth

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Energy efficiency and sustainable development in china

Energy Efficiency and Sustainable Development in China

Professor Shujie Yao and Dr Dan Luo

School of Contemporary Chinese studies

University of Nottingham


Outline
Outline

  • Can China sustain its fast growth?

  • What is the implication on environment?

  • Energy consumption & growth

  • Structural changes

  • Factors for high energy demand and low energy efficiency

  • Conclusions and policies


Background
Background

  • Sustainable development

    ----“development that meets the needs of the present generation without compromising the ability of future generation to meet their own needs”.

  • Economic growth and environment

    -- Past: Western Industrial Revolution: fossil fuels  pollution  global warming, ocean acidification, loss of tropical forests and water supply shortage

    -- Present: Emerging economies: emissions from BRICs


Current situation in china
Current situation in China

  • Pressure: reducing CO2/GDP by 40-45%, 2005-20

  • Internal challenges

    Highly energy-intensive growth path

    Massive consumption: 3.2 bil.TCEin 2010, 20% of world total, >US, largest energy consumer

    Massive imports: oil (2010) 239 mil tons, 53% of total demand. By 2030, import dependency, 80% of oil, 10-20% of coal  energy security problems

    Severe environmental pollution.


Chinese government policy
Chinese government policy

  • 11thFYP (2006-10): efficiency 20%, or 3.7%/year

  • 12thFYP (2011-15): efficiency by another 16-17%

    However, current trend not promising due to

    Poor industrial structure and lack of innovation


Growth and energy challenge i
Growth and Energy: Challenge I

  • Limited domestic reserves and low per capita supply

    -- Energy reserves << demand, esp. oil  energy security;

    -- Per capita consumption low but aggregate demand massive

    a) Rapid urbanization and industrialization

    b) Changing consumption of people due to rising income


Energy consumption china us 1971 2010
Energy consumption, China & US, 1971-2010



China s oil consumption imports 1980 09
China’s oil consumption & imports 1980-09



Electricity output 2008 bil kwh
Electricity output, 2008 (bilkwh)


  • Growth and Energy: Challenge III

  • Fast growth of energy demand and efficiency

    -- Fast economic growth with fast energy growth

    -- Low efficiency in China: 4.5 times energy and 3.8 times electricity for same amount of GDP compared to OECD

    -- Energy efficiency of China significantly lower than India and Brazil.


Gdp energy electricity growth in china
GDP, energy/electricity growth in China



Energy electricity per unit of gdp by country
Energy & electricity per unit of GDP by country


High demand/low efficiency

of energy in China: Factor I

Economic and industrial structure: GDP dominated by industry


High demand low efficiency of energy in china factor ii industry dominated by heavy industry
High demand/low efficiency of energy in ChinaFactor II: industry dominated by heavy industry


Energy consumption by industry in china 1995 09
Energy/consumption by industry in China, 1995-09


Fast expansion of 8 energy intensive sub industries
Fast expansion of 8 energy intensive sub-industries

  • Industrial production and energy consumption of eight key industries to total



Output of energy intensive products 1978 09
Output of energy intensive products, 1978-09



High demand/low efficiency of energy in ChinaFactor III: Industry relocation coastalto inlandEnergy production/consumption by region, 1990-09


Gdp energy consumption output of 8 industries by region 1990 09
GDP, energy consumption &output of 8 industries by region, 1990-09


Conclusion policy implications
Conclusion & policy implications

Factors for China’s rising energy consumption


Policy recommendations
Policy recommendations

  • Structure transformation, reducing reliance on heavy industry and polluting industries

  • Reducing dependency on exports of polluting goods

  • Price reforms

  • Alternative energy

  • Technology and innovation

  • Creating a self-enforcing endogenous growth model



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