Pictures of the Future      Spring 2008

Why China Needs and Wants to Conserve Energy

Interview with Andreas Oberheitmann

Economist and China expert Prof. Andreas Oberheitmann, 43, is the director of the Research Center for International Environmental Policy (RCIEP), as well as a guest professor at Tsinghua University in Beijing. Oberheitmann previously worked at the RWI economic research institute in Essen. His activities at RCIEP focus on a program sponsored by the GTZ technical cooperation organization that seeks to develop practical solutions to problems associated with climate protection in developing countries.

How big is China’s appetite for energy?
Oberheitmann:China’s current primary energy consumption is 2.4 bn. t of hard coal units (HCU), which corresponds to about 16 % of global consumption. China is thus second only to the U.S. in total energy consumption, and depending on how its gross domestic product (GDP) develops, it will be consuming 6.8 to 11.7 bn. t of HCU by 2020.

That’s three to five times today’s figure—a huge increase. What will per capita consumption be like?
Oberheitmann:Our energy demand model projects that in 2020 each Chinese citizen will consume an amount of energy equal to that used by the average German today, which is around 6.4 t of HCU. In terms of per capita GDP, China may wind up being wealthier than Germany is by 2020 or 2030, given purchasing power parity. Still, we believe it will take many years for China to achieve the level of energy efficiency now common among countries like Germany. For example, China currently requires 3.5 times more energy than the global average to generate one euro’s worth of GDP. However, because the renminbi is significantly undervalued at the moment, the difference is not as great in terms of purchasing power parity.

That isn’t good news for the climate...
Oberheitmann: That’s right, unfortunately. China is expected to surpass the U.S. within the next two years as the number one producer of CO₂ emissions. China already emits 6.1 n. t of CO₂ per year, and that figure will climb by ten billion tons by 2020. If drastic measures aren’t taken, China will play a key role in pushing up CO₂ emissions worldwide.

Does China need to undergo the industrial revolution process as we know it in the West? Can’t it start using environmentally friendly energy sources now?
Oberheitmann: Yes and no. History is repeating itself—but at a much faster pace, with some stages being skipped. That’s an argument to get China to sign up to environmental protection. It’s true that the industrialized countries have largely produced the CO₂ that’s accumulated in the atmosphere to date—with the U.S. accounting for around 27 % and China only 8 %. However, China will account for a major share of future emissions.

China’s energy policy seems inconsistent at times. The Chinese put a new coal-fired power plant into operation every few days, but the government also addresses environmental issues…
Oberheitmann: Economic growth requires energy. To get it, China must install between 60 and 100 GW of new power generation capacity each year. That’s nearly the equivalent of Germany’s current total capacity. More than 70 % of the new facilities in China are coal-fired plants, which of course produce CO₂ emissions. China’s government is aware of all this, which is why its current Five-Year Plan contains ambitious goals such as reducing specific energy consumption per unit of GDP by 20 % between now and 2010. China both needs and wants to conserve energy. Its economy is now growing at 10 % a year. Obviously its energy consumption can’t grow at the same pace. In response, the country is introducing measures that will also improve energy security. And China has produced results. The four-gigawatt Huaneng Yuhuan power    facility, for example, has an efficiency rating  of 45 %—a top value for a steam power plant. China is also building the world’s highest-capacity direct current transmission line, which will be able to supply 5,000 MW. In addition, the country plans to limit new residential construction in large cities to buildings that require 65 % less energy than the level required by today’s standard. Investments are also being made in district heating systems.

Can China also make greater use of distributed energy sources such as solar cells and wind turbines?
Oberheitmann: Such an approach is good for remote areas not linked to the power grid. Tibet uses a lot of hydro power, for example, and solar-thermal facilities for hot water can be found throughout the country. Although photovoltaic systems are still often very expensive, China is the world’s leading manufacturer of solar cells. In remote areas, photovoltaic systems are used mostly as a substitute for biomass, although they also power small diesel generators. Photo­voltaic power isn’t usually channeled into the public grid. The situation with regard to solar power could change over the long term, of course, if oil prices increase dramatically.    

                                                               Interview conducted by Jeanne Rubner