China’s Thirst for Energy

China’s growing consumption and production of energy have significant implications for climate change policy. In the recent article “Peak Energy and the Limits to China’s Economic Growth,” economist Minqi Li contends that the “financial cost required to bring China’s emissions down to within the limits of its fair share of the carbon budget is likely to be very large,” and may be considered “economically prohibitive.”

In other words, when it comes to China’s economy, there is a choice to be made between preventing climate change or increasing GDP.Li uses speculative exercises to predict China’s remaining domestic energy supply, position in the global energy economy, energy consumption, and greenhouse gas emissions from 2012 to 2100. The exercise shows that China will contribute more CO2 than is consistent with a hypothetical carbon budget that would keep global temperature changes below 2 degrees Celsius.

According to Li’s analysis, the potential of China’s nuclear and renewable energies adds up to 910 million tons of oil equivalent (mtoe). For comparison, in 2008 China’s total primary energy consumption was 1,900 mtoe, 73% of which came from coal. Li projects that China’s energy consumption will grow to nearly 5,000 mtoe by around 2040, making it virtually impossible for non-emitting sources to replace the fossil fuel sources that currently supply 90% of China’s energy.

Based on current trends, Li predicts that China will emit 820 billion tons of CO2 during the twenty-first century. In some models, this would imply more than 4°C of global warming. To limit temperature change to 2º C, China would need to emit less than 160 billion metric tons of CO2. Yet from 2001 to 2008 China emitted approximately 40 billion tons, and is likely on track to exhaust its “carbon budget” in about 17 years. Minqi speculates that keeping emissions below 160 billion metric tons would cost the country a cumulative $33 trillion over the next century.

China sits on massive potential coal resources . While projecting economic trends and energy market developments 90 years into the future is an extremely speculative exercise, if China meets even  some of its energy demand growth through the use of coal, it seems there is slim chance of avoiding climate change.