Renewable Energy in The People's Republic of China - Energy Production and Consumption

Energy Production and Consumption

Further information: World energy resources and consumption

In 2013, China produced 70% of its energy from coal, emitted more carbon dioxide than the next two largest countries combined (U.S.A. and India) and emissions had been increasing by 10% a year.

Chinese energy experts are estimating that by 2050 the percentage of China's energy requirements that are satisfied by coal-fired plants will have declined to 30-50% of total energy consumption and that the remaining 50-70% will be provided by a combination of oil, natural gas, hydropower, nuclear power, biomass and other renewable energy sources.

Since June 2006 when Chinese Premier Wen Jiabao visited the Shenhua Group's coal liquefaction project and expressed that coal-to-liquids production was one important part of China's energy security, there have been many new ‘coal to oil' projects announced by many large coal producing provinces and cities. As of the end of 2006 there will 88 methyl alcohol projects planned; the total capacity of these projects is 48.5 megatons/year. If all of these projects are built, by 2010 output of methyl alcohol will reach 60 megatons/year. This development rush to build coal to oil projects is giving rise to concerns about a new round of wasteful development and the unintended consequences of such rapid development; these include wasteful extraction of coal, excessive use of water (this process requires 10 tons of water for every ton of oil produced), and likely increases in the price of coal.

According to a study conducted by the Energy Research Institute of the National Development and Reform Commission on the economic circumstances of China's crude oil and chemical industry as of 2007, in recent years China has wasted an average of 400 megatons of coal equivalents per year. In 2006 China consumed a total of 2.46 gigatons coal equivalents, up from 1.4 gigatons of coal equivalents consumed nationwide in 2000. With energy consumption increasing at the rate of 10%/year, in the last 5 years total energy consumption has exceeded the combined amount of energy consumption over the previous 20 years. According to Dai Yande, the chairman of the Energy Research Institute of the NDRC, while continued high consumption of energy is unavoidable, China must take steps to change the form of its economic growth and increase substantially the energy efficiency of Chinese industry and society generally. Among other things China should find new points of economic development that moves China away from being the "World's Factory" and improves energy efficiency. China also must avoid unnecessary waste, foster a sustainable economy and encourage renewable energy sources to reduce China's reliance on petrochemical energy resources.

In 2006 a total of 2.8344 PWh of electricity was generated in China from an installed base of 622 GW of power generating capacity; in 2006 alone an additional 105 GW of installed capacity came on line in China. Experts estimate that another 100 GW of newly installed electric power generating capacity will again come on-line in 2007, but that 2006 probably was the high water mark for electric power capacity development in China.

China and Russia are in talks to link their electric power networks so that China can purchase power from the Russian Far East to supply Northeast China (Dongbei). The benefits for China of importing power from neighboring countries include conserving domestic resources, lowering energy consumption, lessening China's dependence on imported oil (80%-90% of which must be shipped through unsafe waters) and reducing pollution discharge. China already has begun to build a 1 MV high-tension demonstration project and a 800 kV direct power transmission project and after 2010 China will have a long distance high tension, high capacity transmission line for international transmission of electric power. China also is considering connecting its power transmission lines with Mongolia and other former Soviet states that border China and specialists predict that by the year 2020 more than 4 PWh of power will be transmitted into China from neighboring states. In that year China is expected to produce 250 megatons of crude oil and be required to import approximately 350 megatons of crude oil, a reliance on exports of 60%. If China is able to import 620 TWh of power from neighbors, it will be able to reduce crude oil imports by 100 megatons. By importing electric from four or five neighboring countries China will not only reduce its dependence on imported crude oil, but also will enhance energy security by diversifying its foreign energy sources, making China less vulnerable to disruptions in supply.

In 2007, transportation's share of crude oil consumption in China is approximately 35%, but that by 2020 consumption of crude oil for transportation purposes will have increased to 50% of total crude oil consumption.