6 February 2013 – When the stone age ended it wasn’t because they ran out of stones. And so it could be with coal.
News seeping out from China, points to a peak coal scenario for the world’s biggest consumer of the dirty brown stuff.
In a story posted this afternoon (Wednesday) Fairfax Media flagged “China’s decade-long boom in coal-driven heavy industry is about to end as the leadership shifts priorities towards energy conservation.”
“Coal consumption will peak below 4 billion tonnes,” the report said, quoting Jiang Kejun, director of the Energy Research Institute under the National Development and Reform Commission (NDRC).
“There’s no market for further development of
- Maybe this is one of the reasons: Greenpeace found that the fast pace of water consumption by coal and chemical industries in the area is drying up all water resources further downstream. In fact, by 2015, water consumption by coal and chemical industry in China’s dry, western areas is set to use up a whopping quarter of the water flowing annually in the nearby Yellow River, which forms much of the border of Shanxi Province and is popularly known as China’s “Mother River,” wrote chinadialogue. Read more
- Or this: on China’s toxic air pollution that is putiing people in hospital and the morgue
- Or this: on how China’s pollution is reaching Japan
Yes there could be an “income shock” to Australia as the report suggested. And in China
“Dr Jiang said the energy targets would bite hardest with energy-intensive heavy industries such as steel – dependent on iron ore and coking coal – which he said had saturated their potential markets and could no longer make money.
“In the first 12 years of this millennium, China increased annual coal use by a staggering 2.4 billion tonnes, or 163 per cent, accounting for more than four-fifths of global coal consumption growth.
“Last year China bought 19.5 per cent of Australia’s thermal coal exports worth $2.8 billion; 17.5 per cent of coking coal ($3.5 billion) and 72.5 per cent of iron ore ($38.6 billion), according to estimates by Kieran Davies, an economist at Barclays Bank.
“Foreign energy analysts are mostly sceptical that China can meet its “non-binding” energy goal, pointing out that it missed its 2010 target by a large margin.
“Chinese officials and analysts acknowledge that state-owned enterprises, regional leaders and their political patrons have resisted or ignored previous edicts.
But reality bites: there’s the clear and present danger, if people already can’t breathe the air, and the power of having a single party run your country, making the rules
“But they say the economic growth is now ready to be weaned from its addiction to coal and the State Council decision – including to apportion responsibilities to local governments and enterprises – shows a stronger political consensus has been reached to mobilise the bureaucracy.
“Pan Jiahua, who heads a team of climate change economists at China’s leading think tank, the Chinese Academy of Social Sciences, told Fairfax Media that the
State Council’s endorsement of the energy target had the effect of
elevating it into a “political requirement”.
“He said officials in local governments and state-owned enterprises would now be judged partly on their ability to meet energy targets while a long list of green slogans, incentives and policies were translating into concrete measures.
“Chinese people have done enough tolerating such bad air,” he said.
The State Council last week set a total primary energy consumption target (including renewable energy and transport fuel) of 4 billion tonnes of “standard coal equivalent” in the five years to 2015. Confusingly, 1 tonne of actual coal equates to about 0.68 tonnes of coal equivalent, according to Dr Jiang.
With two years of the plan period already used up, the target translates to annual growth in energy consumption of about 3.5 per cent over the next three years, down from 6.6 per cent per year in the five years to 2010.