Factories in China are beginning to operate normally as the energy crisis plaguing the nation begins to wane. However, the crisis itself, and the reactionary measures taken to alleviate the crunch, may have lasting effects on global efforts to combat climate change.
To recap, in early October, major news outlets began covering a significant fuel shortage in China. The shortage was created by many factors, with the nation’s post-pandemic revitalization plan acting as the impetus. The Chinese government began a massive industrial investment plan, including increasing manufacturing from Chinese factories. This led to considerable increases in energy demand, which was met by a ramp-up of coal use for electricity generation, as the price of coal globally also began to rise. However, China’s political structure allows for the government to control prices of certain commodities such as coal, and did not act to increase the price of Chinese coal, leaving the country’s coal mines in a position to operate at a loss, or at best, break even. In response, factories started using up reserves, and the government enacted planned blackouts and restrictions on factory operations.
Now, the crisis is beginning to reverse. Chinese officials noted that their efforts to combat the crisis have “achieved initial results,” and that “coal production … [and] prices are gradually back to normal.” Though the crisis has not been entirely avoided, externalities of the event may have longer-lasting effects that go beyond China.
China announced that coal demand rose by 11 percent in the first half of 2021, which follows the International Energy Administration’s forecast of a 4.5 percent increase in global coal use in 2021 as the world emerges from the pandemic.
The decision to ramp up coal use in China, and globally, is certainly not in line with global climate change efforts. The burning of coal leads to an increase in greenhouse gas emissions associated with the fuel. In fact, at the COP26 climate event, 190 individual countries pledged to phase out coal from their domestic energy mixes due to its emissions profile.
There are questions now, as to whether or not this crisis will change China’s goals for the future. Last week, Axios reported that a China analyst with Greenpeace stated that “the energy crisis will make China’s climate politics complicated”.
China’s future fuel plans are unknown, but it is likely that coal will continue to be a fuel source in the nation, especially in its more industrial provinces. Though unclear, it can be reasonably assumed that if there aren’t actions taken to reverse this current course, the goals of the Paris Accord and other global climate initiatives will not be met by original deadlines.