On the first year of carbon Neutralization in China
What kind of answer did China hand over in such a "carbon neutral first year"? The data recently released by the National Bureau of Statistics provide a "sketch" for this year's low-carbon transformation process.
Wen Baiyu 2021 is the first year after China announced its goal of carbon neutralization and the opening year of the 14th five-year Plan. Since the "double carbon target" (that is, carbon peak and carbon neutralization target) was first included in the government work report of the "two sessions" in 2021, the relevant policies have emerged one after another in this year, and the market reaction is ever-changing. What kind of answer did China hand over in such a "carbon neutral first year"? The data recently released by the National Bureau of Statistics provide a "sketch" for this year's low-carbon transformation process. According to the latest statistical bulletin on national economic and social development in 2021, with the annual gross national product increasing by 8.1% over the previous year, China has reduced its carbon emission intensity by 3.8% in the past year, while the total carbon emission has increased by 4%, down from 9% in the first half of the year. The installation of renewable energy continued to grow significantly this year, while the performance of representative products such as electric vehicles overshadowed traditional infrastructure raw materials such as steel and cement. But at the same time, coal remains the most "tangled" part of China's low-carbon process: a year after the target of reaching a carbon peak by 2030, China's coal consumption has returned to an all-time high, but still below the possible peak in 2013. The proposal of strong carbon peak and carbon neutralization targets for new energy growth has provided a strong boost for the field of renewable energy in 2021. A series of electricity market reform measures proposed last year, including the policy call to build a "new power system with new energy as the main body", further unleashed the potential of renewable energy. Renewable energy plays a leading role in the new installed capacity in 2021, and its power generation is also gradually increasing. According to the latest data from the National Bureau of Statistics, China's wind power and photovoltaic power generation increased by 46.95 gigawatts and 53.13 gigawatts in 2021, accounting for 26.6% and 30.1% of the country's new installed capacity, respectively. So far, the cumulative installed capacity of wind power and photovoltaic has exceeded 300 gigawatts. According to previous data released by the National Energy Administration, China's renewable energy generation, including hydroelectric power, reached 2.48 trillion kilowatt-hours in 2021, accounting for 29.8% of the electricity consumption of the whole society. Among them, the total amount of wind power and photovoltaic power generation also reached 11.8% of the electricity consumption of the whole society.
Distributed photovoltaic has developed rapidly this year, with an annual installed capacity of about 29.2 gigawatts, accounting for 55% of all new photovoltaic installations, surpassing centralized power stations for the first time in history. Ma Lifang, an expert from the Policy Research Department of the Renewable Energy Special Committee of the China Circular economy Association, believes that the pilot project of distributed photovoltaic development on the roof of the whole county launched last year, as well as the policy plan to target the roof photovoltaic coverage area of new public buildings, has found new application scenarios and greater development space for distributed photovoltaic. Anders Hove, director of the Sino-German energy transformation project, also wrote that the new time-sharing electricity price policy reform makes rooftop distributed photovoltaic projects more economical. Offshore wind power has made a great contribution to the increase in the scale of wind power, with a new scale of 16.9 gigawatts in 2021, 1.8 times the total scale built in the past. At present, China's total installed capacity of offshore wind power is 26.38 gigawatts, ranking first in the world. Liang Wanliang, director of the Global Wind Energy Council (GWEC) in China, believes that the main driving force behind this is the Chinese government's subsidies for offshore wind power projects: "the cost of offshore wind power is very high, and there is a big difference in whether there are subsidies or not," he said. "so, from development enterprises, construction units to complete machine manufacturers, they all want to install as many units as possible before the subsidy policy ends." Lauri Myllyvirta, an analyst at the Center for Energy and Clean Air Research (CREA), commented that the strong installed growth of renewable energy is an optimistic sign of carbon neutralization in the first year, but to achieve the carbon peak target, renewable energy needs to be installed nearly twice as fast as it is now, while reducing the rate of energy consumption growth. "this can be done." The complex coal trend the rapid development of renewable energy is not the whole story of China's low-carbon transformation. The data of coal production and sales in 2021 show the complexity and arduousness of China's carbon neutralization process. It was thought that China had reached its peak in coal consumption as early as 2013. Total coal consumption reached 4.24 billion tons at that time and declined for three consecutive years from 2014 to 2016. Although subsequent consumption rebounded somewhat, it never returned to the 2013 level, and the overall downward trend remained unchanged. According to an analysis of an article published in Nature Geoscience by Qi Ye, a professor at the Institute of Public Policy at Tsinghua University in 2016, this indicates that China's economic growth has been decoupled from the growth of coal consumption, and that the inflection point of coal consumption may have arrived ahead of schedule. But in the first year of carbon neutralization, China's coal production and consumption have both turned on the "warning lights". Although coal consumption has not yet exceeded its 2013 peak, it is very close to that "peak". According to the statistical bulletin released by the National Bureau of Statistics, coal consumption will increase by 4.6% in 2021. According to the relevant data in the communique, coal consumption reached 4.23 billion tons in 2021, only 10 million tons lower than in 2013. Although the share of coal in total energy consumption has fallen further by 0.9% to 56.0%, the continued rebound in total coal consumption is still a cause for concern. At the same time, raw coal production reached 4.13 billion tons in 2021 and imported coal reached 323 million tons-both exceeding the 2013 figure, when raw coal production was 3.974 billion tons and imported coal was 327 million tons. Among them, some coal has become the inventory accumulated by power generation enterprises in order to avoid the "coal shortage" and "electricity shortage" that appeared last year.
Dr. Yang Fuqiang, senior adviser to the climate change and energy transformation project of the Institute of Energy Research of Peking University, analyzed the China-China Dialogue that such a rebound in coal consumption is an inevitable result of rapid economic growth (a growth rate of 8.1%). It is also a normal fluctuation in China's energy transformation. "We believe that coal consumption will peak during the 14th five-year Plan period, which means that it may rise again in the next few years, but the annual increase is not expected to exceed the increase in 2021." Yang Fuqiang said, "it can be considered that the coal consumption in 2021 is another peak, but it should be said that it will remain in the plateau period." Because judging from the current economic development and environmental policies, coal consumption can not continue to maintain a high level of growth, and when the 2025 plateau is over, it will go down. " Yang Fuqiang told China Dialogue that the economic rebound has led to a sharp increase in coal consumption because China's import and export trade boosted manufacturing in 2021, thus boosting demand for coal-fired power. As a "big consumer" of coal, electric power accounts for half of coal consumption. According to the data of the General Administration of Customs, China's foreign trade volume exceeded 6 trillion US dollars for the first time in 2021, and the foreign trade increment reached 1.4 trillion US dollars, which is equivalent to the foreign trade scale of 2005, making a great contribution to GDP. At the same time, as renewable energy can not fully meet the rapid growth of electricity demand, some of the new electricity demand will directly stimulate the growth of coal power, leading to the growth of coal consumption. According to data from the National Bureau of Statistics, coal accounts for 68% of total electricity generation in 2021. For the next coal development, Liu Li pointed out something noteworthy: China continues to invest in coal power. According to his latest report, China will start construction of 33 gigawatts of coal-fired power plants in 2021, the largest increase since 2016 and almost three times the total of all new construction in the rest of the world. The number of coal-fired electricity newly connected to the grid has also reached 25 gigawatts, less than in 2020, but still more than the rest of the world combined. Lauri believes that if coal consumption grows rapidly in the next few years of the 14th five-year Plan, reaching an excessively high peak, the pressure to achieve the 2060 carbon neutralization target will become very great. Compared with the process of energy transformation, the changes of new and old industries in the first year of carbon neutralization show a clear trend. According to the latest data from the National Bureau of Statistics, China's crude steel production in 2021 fell 2.8% from the same period last year, down 8% from the same period last year; steel production grew by 0.9% from the same period last year, down 6.8% from the same period last year. Although steel production has increased slightly, real domestic consumption has decreased-according to customs statistics, steel exports have increased by 24.6 per cent and imports have fallen by 29.5 per cent. At the same time, national cement production also dropped 0.4% compared with the same period last year. The decline in cement and steel is mainly due to a slowdown in construction activity. Since the second half of 2021, the Chinese government has introduced a series of intensive real estate regulation and control policies to curb the expansion of real estate investment, which is directly reflected in steel and cement data. Liu Li pointed out that real estate was a key driver of China's economic growth after the epidemic, but it was also a major driver of increased carbon emissions, which are second only to coal-fired power generation in the cement and steel industries. If economic growth is less dependent on real estate, consumption of cement and steel will continue to fall and will be closer to the "dual-carbon target". Although China's economy is still driven by real estate, the cooling of real estate seems to be a long-term economic theme in terms of leadership attitude and policy strength. Compared with the cooling real estate industry, the development of China's new energy vehicle industry is booming. In 2021, the production and sales of new energy vehicles completed 3.545 million and 3.521 million respectively, an increase of 1.6 times over the same period last year, with a market penetration rate of 13.4%, an increase of 8% over the same period last year. Gong Huiming, senior project director of the Transportation Project team of the Energy Foundation, analyzed to China Dialogue that the driving forces behind this are demand, supply chain and policy. From the demand side, public transport has been greatly affected by the epidemic, and people prefer to choose private cars to avoid the risk of infection. From the supply side, the epidemic has an impact on the supply chain. Compared with traditional vehicles, new energy vehicles have a stronger local supply capacity of parts and components, and can be better guaranteed in production. At the same time, almost every car company has formulated the strategy of electric transformation and increased market investment. With the continuous improvement of the richness of new energy vehicles for market choice and the continuous improvement of supporting services, people's acceptance of new energy vehicles is also increasing accordingly. In addition, the government's double points policy and subsidy policy have also made a great contribution to the increase of production and sales. Gong Huiming pointed out that with the growth of the number of new energy vehicles, China will then face the transformation of full electrification. How to do a good job in infrastructure, power grid, renewable energy and other planning to ensure electricity demand, will become a very urgent task. He stressed that China is currently in the first echelon in the field of new energy vehicles, but other countries are catching up, and China should set a clearer medium-and long-term goal as soon as possible to promote the development of new energy vehicles. As for the overall carbon reduction performance of "carbon neutralization in the first year", Liu Li said: "the policy system related to carbon reduction is not as specific as I expected." China is on its way to the carbon peak, but we don't know exactly how to go in the next 5 to 10 years to achieve the goal. "
$ChinaAMC CSI mainland low carbon economy theme ETF(159790.SZ$
$ChinaAMC CSI mainland low carbon economy theme ETF(159790.SZ$
Disclaimer: Community is offered by Moomoo Technologies Inc. and is for educational purposes only.
Read more
Comment
Sign in to post a comment
