China Energy News
Dr. Marco Di Capua
DOE China Office
[； Strategic Economic Dialogue] China, US Meeting Sets Positive Tone for SED -
the18th Joint Commission on Commerce and Trade was held in Beijing on 11 December,
2007, on which a series of agreements
were issued on contentious issues such
as product safety, energy and
The latest figures from Chinese
Customs show that between January
and November, China-US trade
expanded 15.7 percent from the same
The China-US Strategic Economic Chinese Vice Premier Wu Yi (C) celebrates Dialogue, launched by Chinese as she, US Treasury Secretary Henry Paulson President Hu Jintao and his US (L), and New York Stock Exchange (NYSE) counterpart George W. Bush, in CEO Duncan Niederauer (R) cut the ribbon September 2006, will last two days in at an opening ceremony of NYSE Beijing
2007 and it will focus on six long-term Representative Office in Beijing December
11,2007. [Agencies] topics: the challenges of globalization,
trade integration, balanced economic
development, the economic impact of energy choices, economic growth and sustainability and bilateral investment. (China Daily: 11 December, 2007)
[； Energy Policy Dialogue] China – US Focus on Energy Collaboration - Minister of
National Development and Reform Commission (NDRC) Ma Kai said China needs "comprehensive cooperation" with the US in every aspect of energy, including electricity, coal, petroleum and gas, renewable energy and energy efficiency. As a key player in the Strategic Economic Dialogue mechanism, Mr. Ma mentioned that China has prepared a China-US energy cooperation guidebook.
Regarding the suggestions, Ma said the USA's "mature experience" in improving coal-burning efficiency; renewable energy research and technological transfers will become new "growth points" for China-US economic ties. The two sides should intensify their energy efficiency cooperation and increase their efforts in clean energy exploration.
The NDRC and the US Department of Energy signed a memorandum of understanding (MOU) in September to cooperate in increasing energy efficiency in China's industrial sector, which accounts for 70 percent of the country's energy demand. Earlier, Assistant Secretary to the US Department of Energy Karen Harbert said the MOU could serve as a C:\convert\temp\13087496.doc
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channel for US companies to export environment-friendly US-made equipment and services to China.
Ma hopes the working teams from the two sides can finish preparatory work as soon as possible and put the MOU in action soon. Meanwhile, The NDRC has agreed with the US departments of Energy and Agriculture that the two countries will implement "comprehensive cooperation" in bio-mass research and use, which is the cooperation priority, and Ma hopes it can be acted now. (China Daily: 11 December, 2007)
[； Energy Outlook, Policy, Statistics] Draft Legislation for Energy - On December 1,
the draft of the energy law was released through the media and Internet to solicit the views of the public which is to negate setbacks and the authorities are looking for suggestion from the public. One of the most important is to set up a special department to oversee all matter related to the use of energy.
Currently, in China, matters related to energy are dealt with by the State Electricity Regulatory Commission, the Ministry of Land and Resources, the Ministry of Water Resources, the State Environmental Protection Administration, the Ministry of Science and Technology, and the National Development and Reform Commission. When so many departments are in charge, the situation becomes complicated and hinders the proper regulation and supervision of energy. China does not have a common strategy for the development of energy resources as it is in the hands of so many departments. And the absence of such a strategy goes against the increasingly important role energy plays today in the national economy. This is what the authorities should consider in the draft legislation. (China Daily: 12 December, 2007)
[； Energy Efficiency] More Investment on Energy Efficiency - After the Ministry of
Finance announced in late November a total of 23.5 billion yuan has been earmarked for the effort, more can be expected from central coffers in 2008 for energy purposes. In late November, Vice-Premier Zeng Peiyan reported that for the first time, emissions of sulfur dioxide and chemical oxygen demand - two key pollutants to watch in global environmental reports - have both been on the decline. The 23.5 billion Yuan budget by the Ministry of Finance will be used to support ambitious plans that include the so-called "top-10 national energy conservation projects". Though only termed "projects," each represents significant investment and involves major changes. Economic planners estimate that the top-10 national projects will save 240 million tons of coal equivalent (TEC) in five years. Coal contributes up to 40 percent of the country's energy at present.
The projects are:
; Reducing the use of petroleum and seeking substitutes
; Improving coal-burning industrial boilers and raising their energy efficiency
; Developing regional combined circular power plants (CCPP)
; Recycling waste heat and pressure
; Increasing energy efficiency in power generation systems
; Improving overall performance of energy systems
; Energy conservation in construction and lighting systems
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; Government leadership in conservation
; Strengthening monitoring systems and related services in energy saving and
The 10 projects cover not just industrial but also domestic consumption. Advocacy of green lighting systems is directed toward Chinese families. The nation plans to push forward the use of highly energy-efficient bulbs at home and in public infrastructure, which could save about 29 billion kWh of electricity. Around 9 billion Yuan which is 13 times that of 2006, has been allocated towards these projects, as the National Development and Reform Commission (NDRC) said in July.
Of the more-recently announced 23.5 billion Yuan from central coffers, 7 billion Yuan will be used as financial rewards for successful implementation of the top-10 national projects, according to Zhang Shaochun, vice-minister of finance.
The rest will be spent on:
; Sewage treatment and pipelines in cities in central and western China - 6.5 billion
; Relocation and other compensation for phasing out old and wasteful production
capacity - 2 billion yuan
; Building up the monitoring and statistical system on environment and pollution -
3 billion yuan
; Prevention of water pollution in the Yangtze, Yellow and Huaihe Rivers and
Dongting, Poyang and Taihu Lakes
At the same time, according to the Economic Daily, although China's index of energy intensity, better known to the Chinese as energy use per unit of gross domestic product (GDP), decreased an annual 3 percent in the first three quarters of the year, it still remains a question whether the nation will achieve its yearly target of a 4 percent decrease. A total 20 percent cut in energy intensity is planned for the 2006-2010 period by the Chinese government, as measured compared to the 2005 level. On average, it will have to achieve a 4 percent energy cut each year to meet the goal. (China Daily: 12 December, 2007)
[； Beijing Olympic Games] Beijing’s New Action for 2008 - Focus on the fact that
about 40 percent to 50 percent of the major pollutants in Beijing's air -- nitrogen oxides, carbon monoxide and inhalant particulate matter -- come from vehicle exhaust emissions. Beijing will introduce cleaner energy for automobiles and greatly cut emissions, as air pollution has become a major concern for the city in the preparation for "green" Olympic Games.
From January 01, 2008, automobile distributors in Beijing will have to sell gasoline and diesel meeting the new China IV standards that are equivalent to the Euro IV standards in the European Union, according to Du Shaozhong, deputy director of Beijing Environment Protection Bureau. New standards will reduce the amount of sulphur dioxide pumped out onto the streets of the nation's capital by automobile exhausts by 1,840 tons every year.
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Environmental authorities said major distributors including Sinopec and PetroChina are "technically mature" enough to provide China IV standards fuel and are well poised to first sell the product in Beijing.
To reduce pollutants in emission, some buses in Beijing have already used fuel that meets the China IV standards. There are 3.1 million motor vehicles in Beijing and about 1,000 to 1,200 vehicles are adding to Beijing's roads every day. Despite a rapid increase in the number of motor vehicles, Beijing has managed to reduce nitrogen dioxide and carbon monoxide, two main pollutants in exhaust emission, in the air.
Meanwhile, enlarge the construction of Beijing’s subway system is another way to buffer
the pressure of city’s public transportation. The total investment in Beijing's subway system is set to reach about 80 billion yuan ($10.8 billion) by 2010, and the city's underground network is expected to become the world's largest by 2015, the Beijing Morning Post reported 10 December, 2007. (China Daily: 12 December, 2007)
[； Environmental Protection] Clean Air Targets in Beijing, Guangdong and Hongkong – IN Beijing, during the video meeting with international Olympic Committee on 22 November, 2007, Mr. Liu Qi, the president of the Organizing Committee of the Beijing Olympic Games (BOCOG), said the environment kept improving, which filled the organizers with confidence of holding the Olympic Game with good air quality.
Until November 22, Beijing had 226 days of good air quality (air qulity level II or better) this year, nine days more than the same period last year. In August, Beijing had 28 days of good air quality, including two days of level I air quality and 26 days of level II, adding that the level of sulfur dioxide and inhalant particulate matter in the air also dropped to a new low. These statistics gave Beijing government the confidence to ensure a good environment for next year's Olympic Games.
Beijing has spent 120 billion yuan between 1998 and 2006, more than three percent of its GDP, on environmental protection. The Chinese capital urged citizens to take public transportation instead of private cars by reducing ticket prices and building subway lines as vehicle exhaust emissions became a major source of the city's pollution. The city also limited the use of small coal-burning stoves and natural gas became the clean energy alternative.
In Guang Dong and Hong Kong, Environmental protection officials in the Hong Kong
Special Administrative Region and neighboring Guangdong Province said on Monday, 10 December, 2007 thaat they are confident of achieving their targets to reduce air pollution by 55 percent from 1997 levels within the next three years.
Reviewing their efforts to clean up the environment over the past four years, Li Qing, director of Guangdong's environmental protection department, and Edward Yau, permanent secretary for Hong Kong's environmental protection department, said they were on target to reach their goals for 2010.
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Based on a report released by both authorities in October, the daily average content of sulfur dioxide in Guangdong and Hong Kong was 0.0715 mg per cubic meter of air, lower than the national standard of 0.5 mg. And in Hong Kong, all cars are now required to meet the EU IV emission standard and all power plants are encouraged to use liquefied natural gas (LNG).
According to Mr.Huang Wenmu, the vice-director of the public relations division of Guangdong's environmental protection department, the environmental protection departments of Guangdong and Hong Kong have already laid down a working scheme for next year. The authorities in both regions will also reinforce the protection of water resources to ensure adequate supplies and also enhance energy-saving and marine resources protection. (China Daily: 11 December, 2007 and 12 December, 2007)
[； Environmental Protection] Power Plants Closed - National Development and
Reform Commission reports, that a total of 365 small thermal power plants with a total
The closures are part of a capacity of 11.1 million kW have been closed so far this year.
national energy-saving and pollution-reduction program. The plants had an average capacity of 30,000 kW and consumed 488 g of coal to generate 1 kWh of electricity. Their age averaged 28 years.
A total of 191 plants with a combined capacity of 5.26 million kW were located in Henan, Jiangsu, Shandong, Inner Mongolia and Sichuan. China's top five power enterprises, local investment corporations and local state-owned enterprises carried out most of the closures, shutting down 199 generators with a total of 8.51 million kilowatts in capacity. These shutdowns comprised 76.7 percent of the total, with the remaining 23.3 percent from private enterprises. (China Daily: 11 December, 2007)
[； Coal] Peabody Joins GreenGen - The US coal company Peabody Energy joined
forces with China's major coal enterprises on 11 December, 2007, to build the country's first near-zero emission coal-fueled power plant, at a cost of nearly $1 billion. Peabody is the only foreign equity partner in the plant GreenGen. Led by managing partner China Huaneng Group, GreenGen will design, develop and operate an integrated gasification combined cycle power plant near Tianjin. A 250-MW plant will be built in the initial phase and capacity is expected to expand to 650 MW. China Huaneng is the majority shareholder in the plant GreenGen and Peabody will own 6 percent of the initiative.
The agreement, reached during the 18th Sino-US Joint Commission on Commerce and Trade in Beijing, helps fulfill the Chinese central government's ambition to develop clean energy and collaborate with US businesses. GreenGen said the site was ideal as it was located near a number of chemical facilities, enabling the project's syngas, heat, byproducts and power to be utilized.
Additional partners of GreenGen include China Datang Corporation, China Huadian Corporation, China Guodian Corporation, China Power Investment Corporation, Shenhua Group, China National Coal Group and the State Development and Investment Corporation. (China Daily: 12 December, 2007)
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[； Environmental Protection] Public Private Partnerships for Environmental Protection - Diageo, a drinks company with a portfolio will donate $155,000 to the “Water of Life” at Taihu Lake project to construct ecological education and popular science centers to enhance public awareness about the importance of protecting water resources. It will be the lake's first large-scale conservation program co-sponsored by a multinational company and a non-profit environmental organization.
Eastern Taihu Lake is faced with the danger of ecological degradation because of widespread pressure brought by excessive fishing. According to a recent survey, 42.8 percent of the water surface in the southeastern part of the lake has turned into marshland and another 39.5 percent is under threat. Only about 17.7 percent of the lake area has remained unaffected. And the impact isn't limited to the lake itself. Currently, Taihu Lake accounts for 17.9 percent of Shanghai's total water supply.
Some 3,000 small- and medium-sized chemical plants, many located on the banks of the lake, are to be closed down by the end of 2009. This year alone 1,700 small factories that use large amounts of energy but have low productivity have been shut down.
The WWF has been in China working on environmental protection for many years through cooperation with corporations and government authorities for sponsorship of conservation and freshwater programs. It signed a cooperation contract through 2010 with Yangtze River Water Resources Commission in October that encourages the public to join in water resource protection and management. The environmental organization's
approach to improve the waters of the central Yangtze includes demonstration projects, policy advocacy, public education initiatives and use of cooperative networks. Another WWF project is a collaboration with HSBC that began in 2002 for the preservation of three lakes near Wuhan in Hubei Province. (China Daily: 10 December, 2007)
[； Biofuel] Subsidize the Bio-Fuel Makers - At the synthetic fuel forum in Beijing on
06 December, 2007, Mr. Zeng Xiao’an, a senior ministry official, the deputy director of
the ministry's department of economic development said that, the Ministry of Finance has drawn up a policy to promote the use of non-food products to make bio-fuel. The government will offer subsidy and other forms of financial support to people involved in the production of such fuel to reduce their risk of loss, said Zeng Xiao'an.
China has worked out a policy to support making bio-fuel from non-food products (such as cellulose, sweet sorghum and cassava) because they are clean sources of energy and have limited negative impact on the environment. Also, China has set an annual production target for ethanol at 2 million tons by 2010 and 10 million tons by 2020. It seeks to use its abundant coal reserves to produce synthetic fuel and reduce its reliance on imported petroleum. Support policies for such projects, however, are still being debated because of concerns over coal-based synthetic fuel's impact on the environment. (China Daily: 08 December, 2007)
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