China Fueling Global Energy Demand

06 August of 2010 by

globalenergydemand China Fueling Global Energy Demand

The lingering financial crisis has loweredgrowth in electricity demand for the past two years in many if not mostareas of Asia, but virtually nobody who tracks global energy issuesseriously doubts that Asia will experience the world’s largest growth in electric power consumption over the next decade.  Demand from theresidential and commercial sectors are likely to drive demand growththrough 2030.  So is China.  China’s rapid economic growth has beenaccompanied by a huge increase in demand for energy and a dramatic jumpin greenhouse gas emissions. In response to these challenges, China’scentral government has made clean energy and energy efficiency strategic priorities, implementing programs and new regulations designed toreduce emissions of major pollutants and greenhouse gases.

Picture1 600x377 China Fueling Global Energy Demand

 

These new requirements offer U.S. companies an important opportunity to provide a wide range of clean energytechnologies to China’s growing market. The mission will help U.S.companies doing business in China to increase their current level ofexports and business and assist experienced U.S. exporters looking toenter the Chinese market for the first time—all of which will supportthe creation of green jobs in the United States.

China Greentech Report 2009 - Cover

The largest market drivers for energydemand are urbanization and economic growth, the latter of which is adirect result of the country’s booming and energy intensive industrialexports. In 2006, according to China’s National Bureau of Statistics,China’s gross domestic product (GDP) increased by 10.7 percent, whilethe primary domestic energy consumption rose by 8.4 percent.Not surprisingly, China is dependent increasingly on energy imports tokeep up with the demand.  Oil imports alone reached 169 million tons in2006, and the dependence on exports accounted for 47 percent of the oilbalance.

Environmental concerns are an additionalmarket driver, specifically in response to the high polluting Chinesecoal industry.  The International Energy Agency (IEA) concluded thatChina overtook the United States as the world’s biggest carbon dioxide(CO2) emitter in 2007.  The World Bank estimates the total cost of airand water pollution in China is roughly $50.22 billion, or about 2.68percent of GDP.  Acid rain is estimated to cost $4.16 billion in cropdamage and $138.73 million in material damage annually.  Moreover, about 54 percent of surface water resources in China have been deemed unsafefor human consumption.

China is considering amending the Renewable Energy Law to require the county’s power grid companies to buy all electricitygenerated from renewable energy sources. Under the draft law, the powergrids would supposedly be forced to buy electricity from renewableenergy projects and make that a priority over purchases from otherenergy sources. Most analysis on the draft law indicates that it isambiguous and gives power grid companies significant latitude in buyingelectricity generated by renewable energy projects

Launched in 2009, the China Greentech Initiative (CGTI) has grown to become the leading international network ofbusinesses and policy leaders united to accelerate the growth of China’s greentech markets.  On September 9, 2009, CGTI,  AmCham Shanghai andPricewaterhouseCoopers released its first analysis of China’s emerging green technology market in China, The China Greentech Report 2009, at the World Economic Forum Annual Meeting of the New Champions 2009.  The report took ninemonths to prepare.  The final product surveyed the untapped potential of China’s greentech markets, estimating the total potential addressablemarket size for greentech solutions could be up to US $1 trillionannually, roughly comparable to 15% of China’s forecasted GDP in 2013.

In January 2010, CGTI published a supplementary analysis complementing the original 2009 China Greentech Report (PDF), which covered the following sectors:

  • Cleaner Conventional
  • Energy Renewable
  • Electric Power Infrastructure
  • Cleaner Transportation
  • Green Building
  • Clean Water

Source

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