Ten years ago there were only three million SUVs on China’s roads. Now there are more than 50 million. Of every 10 vehicles on China’s roads, four are SUVs.

As they are bigger and heavier than an ordinary car, electric SUVs require more batteries, making electrification harder. Internationally, half as many SUVs are electric as non-SUVs – and the rate is even lower in China. According to the China Passenger Car Association, only 280,000 of the 1.1 million electric vehicles sold in China in 2018 were SUVs.

Less plastic, less oil

Currently, the fastest growth in oil consumption is seen in the petrochemical industry, which accounted for 15.3 per cent of total use in 2017. The report pointed out that as more refining capacity comes online in China in the future, the petrochemical industry will become a new driver of oil demand.

Yang Fuqiang, the NRDC’s senior adviser on energy and climate, said reductions in oil use in transportation will be cancelled out by more use in the petrochemical industry. In future, more oil will be used in the chemical industry than as a fuel; notably, to make plastic.

In 2008, China banned supermarkets from providing free single-use plastic bags, but enforcement has been weak and charges for bags too low to put consumers off. Last month, the Ministry of Ecology and Environment and the NDRC announced a ban on plastic bags in all cities and towns by 2022. Restaurants must reduce single-use plastics by 30 per cent.

Recycling rates for used plastics remain low. China produces 68 million tonnes of waste plastic every year. Only 20 per cent of the plastic used in China in 2017 was recycled, according to figures from the China Association of Circular Economy.

Zhu Kuan, manager of Shanghai Re-Mall Environmental Protection New Material, says newly manufactured plastics are still cheap because environmental costs are not factored in. As soon as the government changes that, growth in the sector will “be much less easy”.

He also thinks that the better recycling rates called for in the report will only happen when there is a demand for cheap materials. Growth in the petrochemical industry means the cost of raw materials are at a historic low, so firms see no need to recycle. Government intervention is needed to identify who is responsible for dealing with waste plastic and to make consumption more sustainable.

The new government restrictions on plastics manufacturing and use mean some parts of China will ban or restrict single-use bags, tableware and packaging by the end of 2020, and promote the use of non-plastic or biodegradable alternatives. Breaches will result in a loss of social credit. On the other hand, there will be support given to new recycling facilities.

Don’t overlook exports

Xu Jiangfeng, of the China National Offshore Oil Corporation, pointed out that China has excess refining capacity, some of which is used to refine imported crude oil for export. “What we’re doing,” Xu said, “is using our air, water and soil to meet the needs of our excess refining capacity and the overseas markets.”

According to the customs authorities, 13 million tonnes of petrol and 20 million tonnes of diesel were exported in 2018, up 23 per cent and 8 per cent on 2017 respectively.

With refining capacity rocketing, China has an oversupply of refined products like petrol and diesel, and the industry regards increased exports as a solution. Liu Qiang, of the Chinese Academy of Social Science, says that demand for refined products needs to be reduced, both for energy security and to reduce pollution.

This story originally published by Chinadialogue under a Creative Commons’ License.