Lessons from China’s energy transition
A major challenge that the world faces is in respect of decoupling economic growth from greater use of energy, particularly fossil fuels. Such a move has already taken place in several parts of the world, but given the economic growth taking place in the BRICS (Brazil, Russia, India, China, South Africa) nations, the total demand for fossil fuels is likely to go up, if decoupling does not occur.
The Chinese economic situation is going through a period of transition. In retrospect, it is now apparent that China pursued the same path as that of the developed world wherein the environmental consequences of growth were initially ignored, and whatever cleanup is needed takes place at a much later stage when high levels of GDP are attained.
The Chinese economic scene provides several lessons for India, similar to the record of the developed countries, but which, unfortunately, most countries in the developing world, including India, have ignored. The Chinese authorities and people in that country are now intensively focused on improving the environment and setting an example on the global stage, particularly in dealing with climate change. In this, of course, they also anticipate the growth of business opportunities, because global markets for environmentally friendly products and low carbon processes are bound to grow with increased efforts worldwide for tackling climate change.
The Paris agreement on climate change is based essentially on Intended Nationally Determined Contributions (INDCs) put forward by national Governments, but if these are to be aggregated then they would be seen to represent actions which fall far short of assuring adherence to the 20C limit for temperature increase set in Paris for the year 2100 relative to levels that existed during the pre-industrial period.
There is today an extensive effort in China to bring about an improvement in environmental conditions. Efforts are being made to strengthen laws by which false reporting of emissions data by companies, for instance, can be discovered and penalized effectively. False reporting for private gain and in violation of laws and regulations is a common problem across the globe, as it certainly is in India, where polluting units show compliance with environmental standards but routinely violate them without being penalized. In China such violations are dealt with severely.
While local environmental problems in China are overwhelming in complexity and magnitude, there is today a major national effort to reduce emissions of greenhouse gases by which China is seen to be moving away rapidly from past trends in an effort to deal with the challenge of climate change.
China is by far the largest consumer of coal in the world, and accounts for over half of total global demand. In the year 2000 China consumed 1.36 billion tonnes of coal which grew at an average annual rate of 12 per cent to reach 4.24 billion tonnes by 2013. This has led not only to a high level of emissions of carbon dioxide but also local air pollution in most parts of the country where industry and power generation facilities are located.
There are now, however, serious efforts to reduce carbon dioxide emissions, with a package of policies to decouple economic growth from growth in the use of coal. In the last couple of years it appears that coal use has flattened out, exhibiting a clear change in trend. No doubt, this change has been affected by the economic slowdown over the last 2-3 years, but it is also the result of China’spursuit of energy policy that clearly targets cleaner options.
In order to bring about cleaner energy solutions, large economies like those of China and India need to create the conditions for technological innovation which suit natural resource endowments in these respective societies as well as meet the objectives of responsible management of the global environment. In this regard China has made major strides in creating centres of excellence to promote innovation in several directions that would bring about natural resource efficiency.
Indicators of this trend are China’s efforts to embrace technology for solar cell production which produces zero pollution in manufacture and converts light into electricity at very low intensity levels.
A Chinese company has recently purchased the technology the dye-sensitised solar cells, the performance of which is claimed to surpass the achievements of competitors worldwide. This technology has been developed within China at an institute which is part of the Chinese Academy of Sciences. While developing the cells over a period of 10 years, researchers have registered more than 50 patents, which are now being transferred to the company which is purchasing this technology.
The benefit of this third generation technology would be that it can be utilised for household electrical appliances, traffic lights, outdoor big screens and other devices. While the first two generations of photovoltaic cells required intensive and direct sunlight, the third generation is able to work indoors or on cloudy days. Hence, it can be applied to a variety of situations including areas which are shaded by trees. Overall, this innovation promises to result in a quantum jump in conversion efficiency of solar cells.
Energy for the future will have to come from technologies which are efficient and economically viable. Secondly, innovation of the type that is represented by this third generation photovoltaic cell would not only find widespread applications in China, but provide the country with a growing market globally where Chinese produced solar cells will be found far more cost effective than conventional photovoltaic technology.
In India we have not yet developed a vision of the future whereby new technologies would serve the purpose of sustainable development effectively. This, of course, would require institutions that innovate to be given relative freedom, devoid of bureaucratic controls, so that ideas blossom into specific technologies. Inability or delays in bringing about a restructuring of institutions which can achieve technological innovation would leave us dependent on other countries and deny us the ability to capture new markets which will emerge and grow in the field of sustainable energy technologies.
(The writer is former chairman, Intergovernmental Panel on Climate Change (2002-2015)