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From black gold to wind and solar: How China is turning its back on coal

Choked by pollution and with its economy in transition, the world’s biggest coal consumer is making a push for cleaner energy.

On bad air days, Cao Yiyang doesn’t take his 3-month-old daughter out for a stroll. It’s too dangerous. Staying inside, near the air purifier he recently bought, is better.

“The air pollution is something my children’s generation will have to live with,” the 27-year-old IT technician said. Cao’s son, almost three years old, is allowed to go out and play only if he dons a face mask with a filter for PM2.5 particles – the ones so fine they permeate the lungs, causing long-term damage to the human respiratory system.

Cao lives in Xi’an, a city of 8 million people and the capital of Shaanxi, one of the main coal producing and consuming provinces, right in China’s heartland.

If he looks at the industries around Xi’an and the coal-fired power plants that fuel them, he has little hope the air will improve. “I think it will be a long-term problem. I’m ready for 20 years of this,” he said.

But if it’s up to China’s government, Cao, his children and 1.3 billion Chinese will see significant changes sooner rather than later.

Half of China’s air pollution has been identified as coming from the country’s heavy coal consumption – but the government is aiming to change that through reforms, new policies and international agreements.

Changing economy, changing mentality

A combination of factors is pushing China away from coal: a natural shift in the economy away from heavy industries and toward services, forward-looking policy changes that take air pollution into account and massive investments into renewable energies.

In many ways, modern China, the world’s second-biggest economy, was built on coal. Since the country’s opening up in the early 1990s, its GDP has grown by more than 6.5 per cent each year, with peaks at more than 14 per cent in 1992 and 2007.

I believe that the air pollution issue makes it much easier for the government to commit to major international climate change targets, since most measures and technologies help improve the air and mitigate greenhouse gases concurrently.

Ranping Song, senior associate, World Resource Institute

Coal-fired power plants produced the electricity needed by steel factories and other heavy industries that spurred this growth.

Tens of thousands of coal mines spread across the country, many of them small, unsafe caves hoping to make money off the “black gold.”

Others were massive operations, like the Haerwusu open-pit coal mine in Inner Mongolia, which was designed to produce as much as 20 million tonnes of crude coal per year.

The massive consumption, however, had its price. A decade ago, China overtook the United States as the world’s biggest emitter of greenhouse gases. Today, it consumes half of the world’s coal, and discharges twice as much greenhouse gas as the United States, making it the biggest contributor to global warming worldwide.

Air pollution has become a plague that nobody living in China is truly able to escape. Lung cancer is now the most common form of cancer. Around 7,500 Chinese die from cancer each day, and while heavy smoking is still the leading cause, air pollution is poised to take its place.

But analysts say coal consumption likely peaked around 2014. Last year, coal use fell by 4.7 per cent, marking the third consecutive annual drop.

Experts believe that coal consumption will continue to decrease over the next few years. “Investment in energy-intensive industries had been significantly declining and is unlikely to rebound,” said Xu Zhaoyuan, head of the research division at the industrial economy department of the Development Research Center of China’s State Council.

“The biggest reason for the shift is economic reconstruction,” agreed Li Shuo, climate policy advisor for Greenpeace East Asia.

Li lives in Beijing and has grown used to wearing masks when he leaves the house. But the environmentalist sees hope. “China is moving from energy-intensive work to more service-oriented work, and this is reflected in several key coal-consuming sectors,” he said.

This fundamental change in China’s economy was already predicted in 2007, when then-premier Wen Jiabao identified the economy’s biggest problem as its “unstable, unbalanced, uncoordinated and unsustainable” growth. Economists pointed to the solution: more domestic consumption was needed.

Exports and heavy industries have made it possible for millions of Chinese to make the jump to middle class, a group that now numbers more than 100 million, mostly white-collar and service industry workers who would never think about toiling in coal factories and mines. The economy is increasingly reliant on their spending.

In 2015, services-sector income surpassed 50 per cent of GDP for the first time. By the end of the same year, more than 90 percent of China’s coal enterprises were reporting losses, according to data from the China National Coal Association.

Another signal of significant changes in China’s economy came last year, when Yin Weimin, the minister for human resources and social security, announced that 1.3 million people employed in the coal sector would likely lose their jobs.

He gave no exact timeframe, but cushioned the outlook by noting that over the next two years 100 billion yuan ($14.53 billion) has been slated to help those who will lose their jobs.

“This task will be very difficult, but we are still very confident,” Yin said.

Electricity produced by coal-fired power plants dropped by 2.3 per cent in 2015 year-on-year. Overall growth of electricity consumption slowed down as well. And yet, new coal-fired power plants were and are still being built. In 2015, the total capacity of new coal-fired power plants built in China was 52,000 megawatts.

Demand may be dwindling, but local governments continue to approve new coal-fired power plants, as they are seen as a quick and easy solution to spurring economic growth and keeping unemployment down.

Trying to take back some control, the National Energy Administration (NEA) has cancelled or halted the construction of 103 projects that would have seen another 120 gigawatts of future coal-fired capacity.

Countrywide, the NEA has capped China’s coal-fired power capacity at 1,100 gigawatts by 2020.

“In terms of drivers for China’s shift from coal, these real changes in the economy are in our favor, and they are the key driver,” Li said. “But you are also seeing a mentality shift,” he added, remembering the first “airpocalypse” in 2013, when air pollution levels reached unprecedented levels in Beijing.

China’s air pollution crisis

Institutions like the American Embassy and consulates already had been measuring China’s Air Quality Index (AQI)  levels, but in 2013, the government officially recognised the dangers of the small particles in the air and started to publish its own readings.

On particularly bad days, the AQI reads more than 500, and has even climbed above 900 in Beijing. The maximum recommended by the WHO is 50; levels of 301 to 500 are classified as “hazardous” — potentially fatal for the elderly and people with cardiopulmonary disease.

Shifting public opinion and real concern about air pollution are accelerating the transition from coal, and making new projects unpopular. It’s become a concern for all Chinese – whether government officials, wealthy businessmen or IT workers like Cao.

Filter masks are more and more popular, and sell out during spells of particularly hazardous air. Equipped with handheld PM 2.5 readers, mothers in Beijing check air-pollution levels of restaurants and museums before they decide whether they’ll stay with their kids. Some even move out of cities, seeking better air elsewhere.

Despite the massive layoffs, support is growing for the shift away from coal. In a public showing of the government’s commitment to reducing its emissions – and thereby its coal consumption — President Xi Jinping signed the Paris agreement last year.

In the agreement, China has committed to cutting carbon emissions by 60 to 65 per cent per unit of GDP by 2030, using emissions from 2005 as a baseline. In addition, it pledged that 20 per cent of the country’s energy will come from renewable energies like wind, solar and hydropower.

“I believe that the air pollution issue makes it much easier for the government to commit to major international climate change targets, since most measures and technologies help improve the air and mitigate greenhouse gases concurrently,” said Ranping Song, a senior associate with the World Resource Institute who is monitoring China’s emission targets.

Although China relies on imports for less than 10 percent of its coal use, its shift away from fossil fuels is having an impact on the world economy, especially on exporting nations like Indonesia, which, at times, saw exports drop by almost 40 per cent. “Significant cutbacks on imports are expected to increase,” research by Global Risk Insights found.

This story was published with permission from Read the full story.

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