Tag Archives: climate change

A Drier China Adds To Economy’s Woes

Officials check rice damage caused by drought in Guizhou Province, August 24, 2022. Photo credit: Xinhua/Yang Wenbin

GLANCING BACK THROUGH the archives, this Bystander came across a more-than-a-decade-old post about China’s water insecurity.

The problem persists. The unprecedented scale of this year’s heatwave and drought — phenomena that will likely be recurring as they are climate-change induced — has only exacerbated it. The consequences will have high economic costs, including some of the second-order ones.

It is not an exaggeration to suggest that water shortages due to climate change are now one of the most serious threats to an economy that looks increasingly beset by structural challenges.

Droughts — and flooding — are annual events, but climate change is making them more severe and longer-lasting. That also gives foreign companies one more reason to source their raw materials, components and finished goods from elsewhere, threatening the maintenance of China’s central role in international manufacturing supply chains.

One reason that water shortages are so difficult to tackle is the uneven geographical distribution of the country’s water resources. Northern China has sparse natural water flows compared to southern China and to the requirements of its dense population and industrial concentration.

Urbanisation has caused water tables throughout northern China to fall fast, drying up irrigation wells for farmers. Poorly regulated industrialisation has worsened the problem by polluting surface and underground water reserves.

Southern China is expected to provide net water transfers to the north and other parts of the country through the South-North Water Transfer Project, a massive three-canal engineering project to divert Yangtze waters to the arid north.

However, the heatwave and drought that occurred from June to August were centred in the south, and persistently drier conditions will raise further doubts about southern China’s capacity to compensate for the north’s structural water deficit.

Economic disruption

They also imply adverse impacts in various sectors of the economy.

Monsoonal rainfall patterns usually mean that the upper Yangtze basin receives half its annual rainfall in July and August. However, during the heatwave, water levels in the Yangtze river dropped to their lowest since records began in 1865. Hydropower generation along the river fell, causing electricity rationing that interrupted industrial production. Shipping using the country’s longest watercourse, a major transportation artery, was disrupted, causing some factories downstream to close temporarily because of the non-arrival of raw materials or parts.

China’s southern and south-western provinces also export hydroelectricity to the eastern seaboard. In mid-August, Sichuan province, which relies on hydropower for 80% of its energy usage, saw its hydropower generation capacity fall by half. The provincial government there, too, required factories to ration power usage, leading to reduced production, which fed into global supply chains.

A second-order consequence is that the drier conditions will also undermine the ‘Eastern Data and Western Computing’ plan to boost the economically lagging western provinces by locating power- (and water-) hungry data centres there that will serve digital activity in the more developed eastern provinces.

The rationale for setting up data centres in poor, western provinces like Guizhou is that mountain rivers can produce hydropower to generate electricity and the mountains also provide a cool climate to help bring down the cost of cooling, one of the largest expenses for data centres. Those conditions no longer look assured.

Agriculture

Agricultural impacts will likely be significant. According to state media, the summer drought wilted hundreds of thousands of hectares of crops, probably millions.

China is a net food importer, and the government prioritises increased domestic production. Harsher farming conditions will make it more difficult to achieve food self-sufficiency. China will thus remain a significant buyer and price-setter in global food markets as climate change aggravates agricultural problems worldwide.

Beijing has few means to ameliorate persistent nationwide water deficits. The agriculture ministry advised local officials during the drought to increase efforts to ensure adequate irrigation water, open new water sources, rotate irrigation and produce artificial rainfall when necessary.

Inducing rainfall by cloud-seeding can provide local relief (providing there are some clouds to seed) but is not a systemic solution to chronic annual heatwaves and drought. Exhortations to open up new water sources are empty words when rivers and lakes are drying up.

China will double down on investing in renewable energy technologies, increasing its influence in these industries globally. Yet, less hydropower may also sustain the continued construction of coal- and oil and gas-fired power plants, reinforcing climate change effects.

Cross-border disputes

Internationally, the reliance of South and Southeast Asian countries on river water originating upstream in China means that chronic droughts in China may inflame international tensions.

China has a poor record of addressing its neighbours’ concerns about upstream dams affecting water levels in the Mekong, Salween, Ganges and Yamuna rivers.

As India’s industrial activity grows, including power-hungry sectors such as semiconductor manufacturing, management of shared rivers is likely to add to tensions with China over disputed territory.

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Heatwave And Drought Stress China’s Electrical Power Supply

BACK IN 2009, this Bystander alighted on a press report that China spent $100 million a year on cloud-seeding to induce rain and snowfall to combat drought.

That was more than six times the figure quoted for the United States. China frequently resorts to using anti-aircraft guns and rocket launchers to blast the sky with silver iodide, reportedly resorting to this way to make rain more often than any other country.

In the past, most cloud seeding occurred in the increasingly arid North China Plain. Now it is being deployed in parts of central and southwest China amid a severe drought and a two-month-long heatwave that the National Climate Centre says is the country’s longest and strongest since records were first kept in the early 1960s.

However, Hubei and several other provinces along the drought-stricken Yangtze river, now at record low levels following less than half the usual rainfall in some stretches, have run into a familiar problem with the technique: you need the clouds to seed in the first place. They are in short supply in a heatwave.

Upstream in Sichuan, the mercury has risen above 40 degrees Celsius with no immediate relief in sight. With water levels in hydropower reservoirs down by as much as half and demand for air conditioning rising, power shortages of up to several hours are widespread.

Electrical blackouts as authorities ration power are affecting industrial production. Emergency measures instituted to ensure households get priority for what power is available are forcing factories to cut back output or stop work altogether.

Foxconn’s factory in Chengdu, which makes Apple’s iPads, is one business amid a six-day shut down because of power rationing.

The overall impact on the economy of drought-induced temporary factory shutdowns will likely be minimal, but it is another drag on an already decelerating economy.

A longer-term concern may be the loss of crops for the autumn harvest, which could drive up inflation. The Ministry of Water Resources has said that the drought has affected 821,333 hectares of farmland in Sichuan, Chongqing, Hubei, Hunan, Jiangxi and Anhui.

Only half the usual annual release of water from the Three Gorges reservoir to relieve drought downstream has been possible this year. Many rivers and streams that flow into the Yangtse and are a source of agricultural irrigation are reported to have dried up.

Meanwhile, at the mouth of the river, Shanghai hit a sweltering 40.9 degrees Celsius in July, equalling its hottest day since the city started keeping records in 1873.

Meteorologists predict that the long-lasting heat wave will become the ‘new normal’ due to climate change.

This will force authorities to pay more attention to the inadequacies of the country’s national power grid, as evidenced by Vice Premier Han Zheng, who, on a visit to the State Grid Corporation of China this week, highlighted the importance of the energy and power supply for social and economic stability.

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China’s COP Cop Out On Coal

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.

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China Will End Coal-Fired Power Plants Abroad If Not Yet At Home

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.

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China-US Climate Blows Hot And Cold

PRESIDENT XI JINPING, it now seems, will attend the two-day virtual summit on climate change that US President Joe Biden will be holding at the end of this week, a week in which Xi is also due to make a major speech on Tuesday at the Boao Forum on Hainan Island.

The primary purpose of the Boao Forum is investment-related. A blue-chip roster of US business leaders and investors will be visibly in attendance to validate China’s recovery from the Covid-19 pandemic. However, Xi is also likely to use the occasion to announce new targets to reduce greenhouse gas emissions, thus stealing some of Biden’s thunder later in the week.

Xi’s attendance at Biden’s summit follows the trip to Shanghai last week by Biden’s climate envoy, John Kerry, to meet his Chinese counterpart Xie Zhenhua. The pair agreed that the two countries would cooperate to tackle global climate change by reducing emissions and work towards a successful next meeting of the UN’s Climate Change Conference in Glasgow in Scotland in November.

The outcome of the Xie-Kerry meeting was a welcome, if not an unexpected, point of surface harmony in what is currently an otherwise deeply dissonant relationship. There is no disguising the discreet but real struggle for global leadership over climate change between the two countries. In that regard, Beijing is repositioning itself following Biden’s reversal of former President Donald Trump’s withdrawal from the field.

Normal service was resumed on Friday with the foreign ministry spokesman criticising criticism of China by Biden and visiting Japanese prime minister Yoshihide Suga.

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Trump Hands Beijing Clear Skies For Global Climate Leadership

Air pollution at sunset, Shanghai, China, 2008

THE UNITED STATES’ withdrawal from the Paris climate accord, newly announced by US President Donald Trump, formally opens space for Chinese and European leadership on the issue that has been expanding ever since candidate Trump denounced climate change as a Chinese hoax designed to weaken US industry.

Having committed on the campaign trail to withdrawing the United States from the deal within 100 days of taking office, Trump now says he will make good on that promise and seek renegotiation of the accord on terms that are not as “draconian” for the United States.

The United States accounts for more than 15% of the world’s greenhouse gas emissions, a share exceeded only by China. Its withdrawal from an agreement that depends on the largest polluters making some of the deepest cuts to emissions inevitably weakens the accord’s chances of success.

During a trip to Germany, Prime Minister Li Keqiang reiterated ahead of Trump’s announcement Beijing’s commitment to the accord. China and the European Union are expected to issue a joint statement to bolster it  in the light of Trump’s abandonment (Update: they did). They are likely to reaffirm their joint commitment to cut back on fossil fuels, develop new green technologies and raise $100 billion a year by 2020 to help poorer countries cut their emissions.

Beijing’s position on climate change has swung through 180 degrees. Once considering international efforts to get it to limit carbon emissions to be an unwanted interference in its internal affairs, China has since become a strong proponent of efforts to halt global warming — and to develop global leadership in climate mitigation technologies.

Li will be familiar with the smog-choked skies above Beijing and a host of other cities (the picture above is of Shanghai). And also with the increasing popular unease at environmental degradation. He made a point of saying that the Paris accord was in China’s self-interest.  Certainly climate change constitutes not just a health challenge to authorities but also an economic and political threat to the Party.

However, it also offers Beijing a tremendous geopolitical opportunity. By not just rejecting the Paris accord but reneging on commitments, Trump hands China an opening to take on global leadership on what may well prove to be the defining issue of the century. Such an offer will not be refused.

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The Global Greening Of China

CHINA HAS THREE imperatives when it comes to climate change: to use the issue to cement its growing position as a world power; to deal with its domestic pollution problems so that they don’t become a political issue that could challenge the Party’s primacy; and to establish industrial leadership in ‘green’ technologies including renewable fuels.

The symbolism of Presidents Xi Jinping and Barack Obama jointly ratifying the Paris climate change agreement (Cop 21) will not be lost domestically or internationally. Xi will take the opportunity of the G20 meeting in Hangzhou to reinforce that message that China is at the centre of world affairs and that, as state media put it, developed and emerging countries are “in the same boat, with China charting the course ahead this time”.

The move by the world’s two biggest polluters is clearly a significant step for the climate change deal, which needs 55 nations accounting for at least 55% of the world’s emissions for it to come into effect. China and the United States raise the percentage at a stroke to more than 40% from 1%. It just now needs the EU and a couple of other countries to follow suit to get the deal over the line.

Beijing’s Paris accord commitment is to cut its carbon emissions per unit of GDP by 60-65% from 2005 levels by 2030 and to increase non-fossil fuel sources in primary energy consumption to about 20%. While those targets don’t necessarily mean a cut in absolute emissions levels, it will slow their growth meaningfully. China committed at Paris that they would peak in ‘around 2030’.

The large steps China has taken in energy efficiency and the rebalancing of the economy away from industrialisation and towards more services will aid it in hitting those goals. Becoming more of a low-carbon economy will also help achieve its domestic goals of lessening pollution, a perpetual point of popular perturbation and protest. Environmental NGOs are kept on a short leash for fear they are a seed of political organisation.

At the same time, China has developed into the world’s largest market for hydropower, nuclear, wind and solar energy and increasingly aims to make those indigenous industries, serving both the ambitions of developing low-carbon urbanisation and bringing economic development to some of the poorest but also windiest and sunniest provinces. As relatively new industries, there is also more opportunity for China’s new found desire to be innovative to flourish, as well as for its manufacturers to find new export markets for wind turbines, solar panels and even nuclear reactors.

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COP21: Follow The Money

Paris skyline

THE PARIS CLIMATE talks — formally the United Nations 21st Conference of the Parties (COP21) — starting on November 30 will be a political bun fight in which China as the world’s biggest polluter will be at the centre. But the how, who and who pays arguments over environmentally sustainable development are only another front in the wider competitive-cooperative struggle between North and South for global influence.

Whatever the outcome of the Paris meeting, China will come off a winner.

The goal of COP21 is for more than 190 countries to agree a global and legally binding treaty that will let the world avoid the worst impacts of climate change. In practice, this means an enforceable plan to keep global warming below 2℃ by cutting greenhouse gas emissions.

The countries that account for 80% of the world’s emissions, three-quarters of which are accounted for by China, the United States, the 28 European Union members and India, have submitted plans for how they will play their part. However, these Intended Nationally Determined Contributions in aggregate fall short of what is needed to meet the 2℃ target.

China’s INDC’s are conventional enough: a speeding up of the transformation of energy production and consumption to mitigate increasing greenhouse gas emissions; continuing improvements in energy efficiency as the economy is rebalanced in a sustainable way; and increases in forest carbon sinks.

In hard numbers:

  • Peak CO2 emissions to be reached by 2030 at the latest;
  • Cut carbon intensity by 60-65% from 2005 levels;
  • 20% of energy produced by renewables by 2030 (10% in 2013); and
  • Increase forest coverage by 4.5 billion cubic meters compared to 2005.

These targets build on ones set out in 2009. That year, Beijing said that by 2020 it would lower carbon dioxide emissions per unit of GDP by 40-45% from 2005’s levels, increase the share of non-fossil fuels in primary energy consumption to around 15%, and increase forests by 40 million hectares and the forest stock volume by 1.3 billion cubic meters compared to 2005 levels.

In its INDC, Beijing claimed that by 2014, it had achieved:

  • 33.8% lower carbon dioxide emissions per unit of GDP than the 2005 level;
  • 11.2% non-fossil fuels share in primary energy consumption;
  • Forested area and forest stock volume increased by 21.6 million hectares and 2.188 billion cubic meters respectively compared to the 2005 levels;
  • 300 gigawatts of installed hydropower capacity — 2.57 times of that in 2005;
  • 95.81 gigawatts of on-grid wind power capacity — 90 times of that of 2005);
  • 28.05 gigawatts of solar power installed capacity of — 400 times of that of 2005; and
  • 19.88 gigawatts of nuclear power installed capacity — 2.9 times of that for 2005.
  • Also, China has initiated pilot carbon-trading markets in seven provinces and cities and low-carbon development pilots in 42 provinces and cities, with a goal of having a nationwide cap-and-trade market in place by 2017.

All of which is real progress, though not sufficient to have kept up fully with the growing economy, as the skies over Beijing bear daily witness.

China’s COP21 targets still look ambitious, unlikely to be achieved without either technological advances both to improve energy intensity (units of energy required per unit of GDP created) and to help nuclear energy replace coal-fired power generation, or a slowdown in the economy to reduce power demand. On some estimates, the later would mean China’s GDP growth rate slowing to at least 4.5% a year for a sustained period in the decade to 2030.

All of which helps to explain why the politics of climate control will be so confrontational at COP21 behind the feel-good words the politicians will spout.

As de facto spokesnation for developing economies, China wants the rich nations to carry the much more of the burden of reducing emissions than poor ones. Its argues that historically the developed countries have gone through their industrial revolutions and so should not expect developing economies to have artificial constraints put on them as they now go through theirs.

The motives for such a position fall along a spectrum running from fairness — developed nations shouldn’t get a ‘free ride’ on pollution just because it occurred centuries ago — to nefariousness — the old world powers are using climate change to hold back the development of new rivals arising in the East and South.

Thus, China wants ‘ambitious economy-wide absolute quantified emissions reductions targets’ for developed countries, while calling only for ‘enhanced mitigation actions’ on the part of developing economies such as itself. Furthermore, it wants developed countries to provide the finance, technology and capacity-building for developing nations to do so.

The proposed financing is scarcely chump change. Beijing wants it to start at $100 billion in 2020 and then increase yearly, with the monies coming from the West’s public purses, not private sources. It proposes that this financing is channeled through the UN’s Green Climate Fund, a somewhat misbegotten five-year-old UN agency that would be made directly accountable to COP21.

So far, the fund has barely raised more money than needed to cover its set-up costs and is wracked by internal disagreements over what it should be funding and how. As of May this year it had received pledges of only $10.2 billion towards its own $100 billion-by-2020 target.

Developing nations don’t like the fund’s focus on private investment, which in practice means Western investing institutions. Environmentalists don’t like its acceptance of fossil-fuel investments, and no one likes the fund’s governance, hence Beijing’s effort to switch it to public funding and put it under COP21’s authority.

The third area of contention at Paris beyond targets and where the money is coming from will be technology. Beijing wants COP21 to impose a clear requirement on developed nations to transfer technologies and R&D to developing countries ‘based on their technology needs’. That would give developing economies, including China, carte blanche to demand virtually any technologies from the developed nations that it wants.

China has need of such technologies, given the challenges of its COP21 proposals. It will not be able to displace coal from the central place it now occupies in the energy mix without a significant increase in nuclear power generation. China is developing an indigenous nuclear industry apace, but its third-generation technology remains unproven, its capacity for making key components for reactors is uneven, and it has limited abilities in spent fuel reprocessing and storage.

Free licence to demand technology transfers from Washington and Paris to tackle any and all of those problems so its nuclear industry can make itself internationally competitive is not going to be acceptable to the West.

However, COP21 will likely yield an agreement, not the vague promises of previous UN climate summits. China will, of course, not get everything it is calling for going in. Binding hard 2030 targets on developed nations are unlikely, as are commitments by the West to any significant public funding of the Global Climate Fund or carte blanche technology transfers.

A mechanism for strengthening national carbon reduction targets every five years is likely. Presidents Xi Jinping and Barack Obama agreed when they met in September to support such an approach, calling for COP21 to establish reporting and accountability that would strengthen emission reduction targets over time.

That, along with some concrete steps towards mobilizing financial and technical resources to assist the power countries to develop sustainable low-carbon and climate resilient economies would be achievement enough in Paris.

These outcomes would give Beijing plenty of advantages. It would get flexibility in recalibrating its tough 2030 domestic emissions targets and constrain Western efforts to impose a World Bank IFC-type private-sector financing model on climate mitigation.

At the same time, it would be free to expand its bilateral climate lending channels such as its South-South Climate Fund. Through its other burgeoning channels such as the Asian Infrastructure Investment Bank, the BRICS’ development bank, and its Silk Road Fund, it can position itself as a key player in global low-carbon investment through its overseas infrastructure and project finance.

With that would come another broad, long-term ratcheting up of Beijing’s global clout, and especially if the next U.S. administration is a more isolationist and climate-change-rejecting Republican one.

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Himalayan Glaciers Not Shrinking As Fast As Feared

More than half a billion Chinese living along the rivers that flow from the Himalayas are at risk from water shortages as a result of disappearing glaciers. If they can take any comfort, it is that a new analysis of satellite data from 2003 to 2010 shows that the glaciers are shrinking up to 10 times less quickly than previously feared.

“The good news is that the glaciers are not losing mass as fast as we thought,” says W. Tad Pfeffer, a professor at the University of Colorado’s Institute of Arctic and Alpine Research and a co-author of the study, published in Nature. “The bad news is that they are still losing a lot of water.”

Mountaineer and filmmaker David Breashears provides some beautiful and disturbing shots of the melting glaciers of the Himalayas. This video was the Asia Society’s entry in a 2010 Asian Development Bank video competition on climate change.

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China To Trial Carbon Trading Market For Three To Five Years

China plans to run its pilot carbon trading market for three to five years before extending it nationally. That sliver of information comes from Su Wei, the government’s chief climate negotiator, speaking at the international climate talks in Durban, South Africa to devise a successor to the Kyoto accord. As we noted ahead of those talks, two provinces, Guangdong and Hubei, and five cities, Shenzhen, Tianjin, Beijing, Chongqing and Shanghai, will comprise the initial market, which is likely to start trading in 2013. But details still remain nearly as sketchy as they were in Beijing’s recent white paper on climate change.

Meanwhile, at the same meeting, officials have indicated that Beijing could set absolute caps on its carbon emissions by as soon as 2020. This would be a significant shift from China’s position that emission reduction targets should be set in terms of energy intensity (the amount of energy used to create a unit of GDP).  There is a danger of reading too much into conference comments this early, but they could imply that Beijing is preparing to take the initiative in breaking the deadlock with the U.S. over which country moves first in cutting fossil fuel emissions, and in making an early play for the capital and technology that will be needed for developing nations to develop low-carbon economies.

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