SOUTHERN CHINA HAS been seeing its heaviest summer rains for 60 years, bringing floods, widespread destruction of crops and more disruption to supply chains.
Hundreds of thousands of Guangdong and Guangxi residents living around the Pearl River delta have been evacuated after a week of persistently high rains. State media have aired footage of people being rescued with ropes and rubber dinghies, and cars floating down streets. Several cities in Guangdong have raised their flood alerts to the highest level.
The rain has disrupted manufacturing and shipping, already suffering under strict anti-Covid measures. Particularly in the more mountainous north of the province, where the flooding is most severe and landslides have happened, businesses were ordered to close temporarily, and public transport was suspended as rising waters approached dangerous levels. The direct economic loss so far is estimated at more than 1.7 billion yuan ($250 million).
To the north of Guangdong, Jiangxi province has also raised its flood warnings. Officials report direct economic losses already reaching 470 million yuan, with 43,300 hectares of crops inundated.
In neighbouring Hunan province, 21,607 hectares have been damaged, and there are reports of landslides and building collapses.
China’s National Meteorological Center warned that downpours could continue for another week, although the heaviest rains are expected to move northwards across central China from mid-week.
In recent years, climate change has made the south wetter and the north hotter and drier.
THERE ARE NO reports of survivors from the Kunming to Guangzhou flight that plunged into a forested hillside near Wuzhou in Guanxi on Monday afternoon with 123 passengers and nine crew on board. Nor, as of Tuesday, had any bodies been recovered, according to state media.
China’s first fatal civil aviation accident in more than a decade has understandably caused widespread shock.
Some 2,000 rescuers who have reached the mountainous district are searching for the aircraft’s flight-data cockpit-voice recorders, assisted by drones. Aviation experts hope the ‘black boxes’ will reveal the cause of the tragedy. However, the high speed of impact may have destroyed them. (Update: At least one of the black boxes has been found, authorities said on March 23.)
The airliner involved, a Boeing 737-800 that was less than seven years old, and the airline, China Eastern Airlines, have strong safety records.
It is too early to speculate on the cause of the accident. Yet, the aircraft essentially nosediving into the ground from a cruising altitude of around 9,000 metres, as shown in the graphic above from the flight-tracking website, FlightRadar 24, suggests an extraordinarily untoward incident, rather than the sort of design problem that caused the worldwide grounding of the Boeing 737 Max after two fatal crashes in 2018 and 2019.
The Civil Aviation Administration of China (CAAC) will handle the investigation. As the aircraft was US-made, the US National Transportation Safety Board has appointed an investigator for the crash. It will assist the CAAC, ‘if asked’.
China Eastern has grounded its Boeing 737-800s fleet. Of the more than 4,200 of the aircraft in service worldwide, Chinese airlines account for 1,177. The CAAC has urged an immediate two-week-long safety overhaul of civil aviation.
Since the unsafe flying days of the 1980s and 1990s, China’s civil aviation had become remarkably safe thanks to investment in new aircraft and strict safety rules imposed after two flights crashed within a month in 2002, with a combined loss of 234 lives.
Last month, the CAAC said that Chinese airlines had set a world record on February 19 by operating without a major accident for 100 million flying hours, stretching back to August 2010 when a Henan Airlines flight from Harbin crashed on approach to the airport in Yichun in Heilongjiang province.
CHINA HAS EMERGED from the COP26 climate summit in Glasgow relatively unscathed, given that it is the world’s top emitter of CO2.
As one of the world’s top two oil producers and exporters, Saudi Arabia took the early heat in Glasgow from activists pushing for an end to the use of fossil fuels. As attention swung to coal, the most polluting of fossil fuels and on which China remains heavily dependent for power generation, India, not China, was most prominent in watering down COP26’s final agreement.
At the last minute, the wording was changed from ‘phasing out’ the use of coal to ‘phasing down’, the same formulation that had appeared in the China-US climate dialogue agreement that the head of the Chinese delegation Xie Zhenhua and his US counterpart John Kerry had forged three days earlier.
Although Delhi put forward the revised wording to the final agreement, Beijing had been instrumental behind the scenes in getting the language changed, reportedly threatening to torpedo the final agreement if it was not. Washington lent its support by not offering any opposition.
Alok Sharma, the Conservative UK politician chairing COP26, offered an emotional apology subsequently, saying he was ashamed by the last-minute change and that China and India would have to justify themselves to the countries most vulnerable to climate change.
The glass-half-full view is that this is the first of the 26 rounds of COP meetings to make any formal commitment on coal. The half-empty view is that the compromise over phasing out its use belies the scale and urgency of the task.
Fatih Birol, executive director of the International Energy Agency, says that to reach the goal of limiting global heating to 1.5C, more than 40% of the world’s existing 8,500 coal plants would have to close by 2030 and no new ones built.
Last year, China commissioned more coal capacity than the rest of the world retired, according to a study by Global Energy Monitor. This US-based pro-green energy group that tracks fossil fuels says China commissioned 38.4 gigawatts (GW) of new coal plants in 2020, accounting for 76% of the global 50.3 GW new coal capacity and offsetting the 37.8 GW of coal capacity retired last year.
Facing disruptive energy shortages, China hit a new record for daily coal production during COP26. With the sixth plenum coinciding with the second week of COP26, it was inevitable that domestic concerns would be foremost for China’s delegation in Glasgow.
THE UK GOVERNMENT’S decision, as host of the COP26 climate summit in Glasgow, ‘not to provide the video link method’ and so prevent President Xi Jinping from participating directly in the event just seems petty.
The UK has insisted that only leaders attending in person could address the meeting. Xi, who has not left China since the outbreak of the Covid-19 pandemic last year, has been able to submit only a written statement.
As the world’s largest polluter today, China has to be part of whatever solutions world leaders come up with for mitigating greenhouse gas emissions. Marginalising it does not seem to help in that regard, even if Foreign Ministry Spokesperson Wang Wenbin passed on a softball opportunity to make an issue of Xi’s exclusion when questioned by state news agency Xinhua during the ministry’s routine press conference today.
Xi, too, pointedly brushed off any perceived insult. The official English translation of his statement opens thus:
There is little doubt in this Bystander’s mind that the UK would not have insisted on in-person participation without the approval of the United States.
The poor state of China-US relations could cast a long shadow over the climate summit. Beijing has not been receptive to US President Joe Biden’s attempts to carve out climate as a rare area of cooperation, although members of his Democratic Party are divided on the extent to which other US interests, such as human rights, should be traded for cooperation on climate.
Biden may also have less than fond memories of how China lobbied other developing nations at the Copenhagen edition of the COP summit that left the Obama administration, in which he was vice-president, taking far more of the blame for that meeting’s lack of progress than it deserved.
It is unclear when the decision to ‘uninvite’ Xi from Glasgow was made, whether before, after it during last weekend’s G20 leader’s meeting in Rome, which Xi did attend by video link.
However, hopes that that meeting would result in an agreement to phase out coal consumption were dashed with China, which contributes 28% of carbon emissions and consumes more coal than any other nation, among the countries resisting making binding commitments.
After the meeting, US President Joe Biden called out China, Russia (President Vladimir Putin is another Glasgow no-show) and Saudi Arabia for being uncooperative.
Last month, China confirmed to the United Nations its updated pledges to bring its emissions to a peak before 2030, cut them to net-zero by 2060, and raise its wind and solar power generation capacity to 1,200 gigawatts by 2030.
However, it has not offered any new pledges to cap energy consumption or make an earlier start on cutting back its use of coal from 2026. Xi’s statement to the G20 confirmed that the ‘1+N’ framework is the timetable China will be following.
CHINA’S PATH TO ‘peak carbon’ by 2030 and becoming a net-zero carbon economy by 2060 is dubbed 1+N — one overarching blueprint and n number of implementing policies. On October 24, we got the ‘1’ in the form of a guidance document jointly released by the Party’s Central Committee and the State Council.
All future policy decisions on economic planning, macroeconomic adjustment and industrial policies will have to be compatible with the blueprint, which contains objectives and timelines for broad areas of the economy, including heavy industry, energy, transport, construction and finance.
The headline objective is raising non-fossil fuels share of energy consumption to at least 80% by 2060, a fivefold increase from 2020’s level, with a timeline for non-fossil fuels to hit a 20% share by 2025 and 25% by 2030. Both interim targets have been previously announced, but not the 2060 one.
Even before the current electricity shortages, coal accounted for approaching 60% of energy consumption, so scaling that back will be a dramatic change, and one being undertaken slowly.
Over the past five years, non-fossil fuels have been increasing their share of energy consumption by barely half a percentage point a year. That will need to be accelerated to triple that rate if the goal of creating a ‘green, low-carbon and circular economic system’ is to be met.
That is not only a question of increasing non-fossil fuel energy generation. It also means structural changes to industry and consumption to make the economy less energy-intensive. To have any hope of achieving its goals, Beijing will have to oversee the world’s largest reduction in carbon intensity.
As well as the coal, oil, and gas industries, chemical and petrochemical producers and steel makers can expect close attention from authorities regarding their energy efficiency.
The risks to economic growth inherent in a full-blown green transition are recognised. He Lifeng, head of the National Development and Reform Commission (NDRC), the top economic planning agency, says carbon reduction must be balanced with ensuring the security of industrial output and supply chains and, in what appears to be a nod to recent power outages, disruption to ‘people’s everyday lives’.
A leading group was established under the NDRC in May to guide and coordinate the transition. Yet, much of the implementation will depend on provincial and municipal authorities, and provinces will get some latitude over timing depending on the industrial structures.
However, local officials are on notice that their performance will be judged on their success in meeting their carbon reduction targets. Those who fall short can expect the same criticisms that came the way of officials who failed to meet economic growth targets when they were the benchmark. Officials will, no doubt, get as creative over emissions reductions accounting as they were with growth.
The guidance promises financial carrots as well as administrative sticks. Beijing is considering creating a national fund to promote the transition to a low carbon economy. That would likely support the development of carbon sinks, carbon capture and storage, and other carbon removal mechanisms.
An expansion of the national carbon trading market is all but inevitable. Supportive central banking (e.g., incorporating green credit into macroprudential assessment) and development of the green finance sector are also mentioned in the guidance.
So, too, is the encouragement of private investment in low-carbon industries. Banks and other financial institutions will be guided to provide long-term, low-cost funds for green and low-carbon projects. Policy banks will play a core role in underpinning long-term stable financing to support the green transition, which will not fail for lack of a plan.
This Bystander expects further details to emerge during the COP26 climate summit in Glasgow that starts at the end of this week.
REPEATED POWER BLACKOUTS are a sign of misfiring economic management that does not reflect well on governments. Electricity shortages have hit many regions of China over the past month, affecting manufacturing, traffic and street lighting, and homes, often without warning. Sixteen out of 31 provinces have begun rationing electricity, and the northeast faces the prospect of power cuts running through the winter.
The power shortages are the consequence of a combination of contradictory policies: moves to improve energy efficiency and cut consumption in support of carbon reduction goals, and fitful reform of the largely coal-fired power generation sector where long-standing subsidies and price controls cannot withstand the rise in global coal prices, leaving power plants short on fuel.
Provinces’ implementation of obligatory emission-reduction targets imposed on them by central government has been haphazard, varying from draconian to lax. In addition, the 3% reduction target for energy intensity for 2021 has also got ahead of the planning process.
The 14th five-year plan (2021-25) mandates targets for improving energy intensity (energy consumption per unit of GDP) and reducing CO2 emissions per unit of GDP. There is also a binding minimum target for the domestic energy supply from all sources of 4.6 billion tonnes of standard coal equivalent (versus 4.86 billion in 2019), but no caps on carbon emissions and coal consumption, and only an aspirational goal to increase the share of non-fossil-fuels in total energy consumption.
The 14th Five-Year Plan for Energy, likely to be published around or after the COP26 summit in Scotland in November, will provide provincial and municipal governments with a more detailed road map. However, that will cover the years through to 2025 and not show the full path to the 2060 net carbon neutrality target date. However, until they have that road map, Chinese and foreign firms operating in China will delay drawing up the emissions reduction strategies that are likely to be required.
The current energy intensity target has also run headlong into China’s infrastructure-investment pandemic stimulus and export- and industry-driven recovery. Factories have put filling orders now, with the consequent surge in demand for power, ahead of improving their energy efficiency.
Last year, primary energy consumption rose 2.1%, coal consumption 0.6% and carbon emissions 0.3%, whereas energy consumption and emissions declined in almost every other economy. The trends have accelerated into 2021.
Beijing is now having to arrange emergency coal supplies for fuel-short provinces and marshall the distribution grid for inter-provincial power-sharing.
The power situation illustrates the costs Beijing will have to shoulder politically and economically if President Xi Jinping’s decarbonisation goals are to be met, and more generally in structurally changing the economy for the next phase of economic development.
Achieving both will mean slower growth, which will have political as well as economic management dimensions. All but the wealthiest provinces are still industrialising, reliant on energy-intensive infrastructure and industries for growth and jobs, and remain fossil-fuel dependent. Xi has also set a goal of doubling the economy over the next quarter-century, implying 4% annual growth.
Yet even with modest growth rates reducing energy demand, technological advances in energy efficiency and the fledgling national carbon trading market taking wing, it will still require rigorous enforcement of central government policies to change the country’s energy mix to lessen its dependence on fossil fuels. As the efforts to impose energy intensity standards are now showing, provincial and local officials will readily foot drag or worse in implementing Beijing’s policies when it is in their interests to do so.
As with many aspects of rebalancing, the tight networking of local officials and local industries provides inherent resistance to policy direction from the centre. This is exacerbated by many of the major players in energy, including the oil companies, major power generators, the two grid companies and industrial consumers such as steel and cement manufacturers, are state-owned enterprises with size and political influence, especially at the local level.
China is far from alone in having to deal with the conflicting tensions between climate mitigation measures and jobs and economic growth. Beijing has prioritised the former of late, but continuing to do will require sufficient political will at high enough levels of the leadership. That will continue to exist until it does not because the political calculations have changed.
CHINA WILL STOP funding the construction of overseas coal-fired power stations under the Belt and Road Initiative, President Xi Jinping told the UN General Assembly meeting in New York via a video link.
The decision will be taken as a welcome, if somewhat symbolic, boost to global control of greenhouse gas emissions, with the next round of COP climate discussions due to take place in Scotland in November.
However, Xi was light on details of how the policy change would be implemented; his announcement amounted to a single sentence in his speech. It appears that China has not funded any coal-fired power stations abroad so far this year, although it has accounted for the majority of new coal projects around the world in recent years.
The bigger switch for China, the world’s largest emitter of greenhouse gases, would be to wean itself off its dependency on coal for domestic power generation.
Half the coal burned in the world is burned in China, and in the first half of this year, authorities approved the construction of 24 new coal-fired domestic power plants, according to Greenpeace, although that is a fall of 80% from the same period last year.
Many of these plants will have a lifespan of 40 to 50 years. That will make meeting Xi’s other climate commitments made last year at the UN, including China achieving peak emissions before 2030 and then transitioning to carbon neutrality by 2060, challenging to achieve.
CHINA IS NO climate denier, although the connections between climate change and the Henan flooding have been only lightly made in state media. However, reaching peak carbon before 2030 and going carbon neutral by 2060 have been policy since last year and are incorporated into the 14th Five Year Plan (2021-25).
Specifics are sketchy beyond a 13.5% reduction in energy consumption per unit of GDP, an 18% reduction of carbon dioxide emissions per unit of GDP and an increase in the share of non-fossil-fuel energy in total energy consumption to around 20% from 15.8% over the life of the plan. The country’s new carbon trading market will have to play a significant role if those targets are to be achieved.
The long gestated national market finally launched on July 16 on the Shanghai Environment and Energy Exchange, becoming the world’s largest trading scheme for greenhouse gas emissions from the getgo.
Progress will likely be cautious. For now, only some 2,225 firms in the thermal power generation sector can participate. They emit more than 4 billion tonnes of greenhouse gases a year, contributing about 40% of China’s total carbon dioxide emissions and 15% of the world’s total.
Other emissions-intensive sectors such, steel, cement and civil aviation are expected to join the market later.
The initial round of carbon permits was allocated for free. The price per tonne of carbon dioxide equivalent was 48 yuan ($7.42) when the market opened. The first bulk deal — Sinopec’s agreement on July 21 to buy 100,000 tonnes of carbon quota from China Resources Group — was priced at 52.92 yuan per tonne.
By way of comparison, the price in the EU’s emissions trading scheme is around 60 euros ($70.80).
However, China’s power generation industry is far from being a market-driven world and not well placed to shoulder the added cost of carbon. The lack of market-priced electricity — local and regional governments set prices — means there is no way for power generators to raise prices and induce lower and more efficient energy consumption by consumers.
In the meantime, the price of coal is no longer regulated, leaving the power generators squeezed. The hope is that this will make them jettison their most outdated and inefficient power generation plants — and turn to renewable sources of energy.
The Shanghai price will inevitably rise as the government expands the number of participants, begins auctioning permits and reducing their supply. At present, there is effectively no cap on carbon credits. It will not be until then that market will significantly affect China’s capacity to meet its goal of net-zero carbon emissions by 2060.
China will probably reach peak carbon sometime this decade, come what may, as the industrial structure of the economy changes, although quite when will depend on a mix of the economic growth rate and the vigour with which authorities pursue policy enforcement of emissions reduction.
If anything, early recovery from the pandemic last year put the country on the back foot in pursuit of its goal. Energy consumption and emissions rose in China in 2020, whereas they declined almost everywhere else.
THE DEATH TOLL from the torrential rains in the Henan provincial capital, Zhengzhou, has risen to 25, including 12 who died in the flooded metro system. Surviving passengers’ harrowing accounts of being trapped in neck-high water have been posted on social media.
State media say at least seven people are missing in Zhengzhou. A further four casualties have been reported in the nearby city of Gongyi, which has been inundated.
Across the province, more than 1.2 million people have been affected, and some 165,000 evacuated in a massive disaster rescue and relief operation. Damage, including to crops, is widespread after a year’s rainfall fell in three days.
Authorities are warning that the heavy rain has increased the risk of geological disasters in Henan’s mountainous western and northwestern regions, raising the prospect of further loss of life. The flooding has already collapsed some roads in the province.
RECORD RAINFALL IN Henan province has caused extensive flooding and left at least 12 people dead.
The twelve who died were trapped by rising waters in the metro system in Zhengzhou, the provincial capital which lies on the southern bank of the Yellow River. More than 500 others were rescued from flooded trains and platforms underground.
The city experienced two-thirds of its annual rainfall in 24 hours spanning Monday and Tuesday. The silt-rich Yellow River often floods during the rainy season from July to October.
Some 100,000 residents have also been evacuated from the city, known for being a centre for iPhone assembly at a Foxconn plant, though the company says that the flooding has not affected operations.
More than a dozen cities in the province have been deluged. Property damage is extensive. Henan accounts for a quarter of the country’s annual wheat harvest.
Concern is mounting that a breached dam in Luoyang city could collapse. Several reservoirs whose water levels are above safety levels also pose a risk of further disasters, as do landslides.
Forty-five years ago 125,000 people lost their lives in flooding in Henan, many in incidents that occurred after the initial flooding.
Thousands of rescuers including soldiers are being deployed in a huge rescue effort. State media is actively countering social media grumbling about the lack of warnings of flood risk ahead of the heavy rains.
Local officials have been told to act pre-emptively where they see danger and not wait for instructions from central authorities. This would suggest that lessons have been learned from the slow initial response to the Covid-19 outbreak in Wuhan, where municipal officials were accused on not acting swiftly enough to contain the outbreak.
The flooding in Henan is the latest example of extreme weather around the world.