Chinese Energy Sector s Role in Low Carbon Transition
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1 Side-event Chinese Energy Sector s Role in Low Carbon Transition Paul SIMONS Deputy Executive Director International Energy Agency Marrakech China Pavillon, 15 November 2016
2 The IEA works around the world to support an accelerated clean energy transition that is enabled by real-world SOLUTIONS supported by ANALYSIS and built on DATA
3 China as an IEA Association country & beyond Sept 2015: opening doors to emerging economies Nov 2015: China became IEA s Association country Chinese Energy Minister attended the IEA Ministerial for the first time IEA Ministers endorsed steps to modernise the IEA Association countries: China, Indonesia and Thailand March 2016: 20 th anniversary of IEA-China relations More engagements and analysis related to China Three-year work programme More personnel exchanges (NEA high-official and secondees), workshops (energy data), visits and meetings Publications: WEO Air quality report (2016), A report on Chinese companies in the sub-saharan power sector (2016), WEO special report on China (2017)
4 China s Energy Transition Coal has fueled China s massive economic growth especially since the beginning of this century But more attention has been shifted to clean energy within the context of climate change and air pollution China is now moving to a less energy-intensive model for growth Renewables and energy efficiency are now playing a key role in China
5 Energy demand (Mtoe) GDP (trillion dollars, PPP) A new chapter in China s growth story Total primary Energy energy demand demand in China & GDP in China Energy demand GDP Renewables Nuclear GDP Gas Energy Oil demand Coal IEA World Energy Outlook (2015) Along with energy efficiency, structural shifts in China s economy favouring expansion of services, mean less energy is required to generate economic growth
6 Has China reached a coal peak? Coal Production and Consumption in China 4500 Peak? Coal consumption in electricity (Mt) Total Coal Production (Mt) Total Coal Consumption (Mt) Source: China National Bureau of Statistics As China faces overcapacity across heavy industry, coal consumption in China declined for two consecutive years in 2014 and 2015, featuring structural changes
7 Coal production overcapacity China s coal production capacity vs. coal consumption in 2015 Recently-built or expanded (including 800Mt of illegal projects) Production halts 1496 Mt 308 Mt Total Production capacity 5.7 Gt 3900 Mt Existing production capacity 2015 Coal consumption Gt Source: People s network Coal is one of the main industries facing severe overcapacity, followed by steel, cement and flat glass
8 New policies underpin a more bullish forecast for renewables Net additions (GW) Renewable electricity capacity growth (GW) in MTRMR s main case % Others Brazil India China Japan United States MTRMR 2015 Forecast MTRMR 2016 Forecast EU28 China remains key growth market for renewable capacity, while the United States surpasses the EU for the first time
9 Mtoe China is an energy efficiency heavyweight Primary energy savings from efficiency gains since 2000 and renewable energy supply in China Energy savings Renewable energy supply Dramatic progress on energy efficiency saved 350 million tonnes of coal in Energy savings are as large as China s renewable energy supply.
10 Energy efficiency is saving CO 2 emissions 3.5 CO 2 emissions savings from efficiency improvements since 2000 in IEA countries and China GtCO IEA countries China In 2015, efficiency gains in IEA and China reduced their combined emissions by 15%.
11 Concluding remarks Investment flows signal move towards cleaner energy An integrated policy approach is needed, covering market design, CO 2 pricing & system integration, including storage & demand response Policy makers need to heighten their commitments, providing clarity and certainty to investors IEA contributes to the energy transition by its work on renewables, system integration & global clean-energy technology colloboration
Side-event Low-carbon urbanisation and industrialisation The role of Chinese cities
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