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China vows to install 1,300MW of clean energy a week

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The coal industry and others with an interest in playing down climate change like to point out that China has been investing in the equivalent of a coal-fired power station a week, so what’s the point of taking action at home?

Well, that equation has suddenly been turned on its head. Not only has China halved thermal coal imports, and could stop them altogether in a few years (as could India), the new climate deal announced with the US this week means that it has engaged to build the clean equivalent of a coal-fired power station a week for the next 15 years.

But it won’t be coal, it will be solar, wind, and hydro. The undertaking to provide 20 per cent of its electricity through renewables by 2030 means, according to the White House, an additional 1,000GW (one million megawatts) of clean energy for China. That’s the equivalent of 1.3GW of wind, solar and hydro a week – or the entire US grid.

As investment bank HSBC noted this week, this is a momentous deal, and one that is likely to inspire countries to follow, particularly in the lead up to the Paris climate talks next year.

While “carbon ostriches” such as Australia and Canada, with the support of the fossil fuel industry, have been busy acting against climate action, HSBC says suggests that other countries are more likely to follow the example of the “carbon elephants” rather than the “carbon ostriches”.

“We believe this China-US bilateral deal increases the pressure to submit ambitious pledges for other top ten emitters such as India and Brazil, as well as countries that have chosen to bury their heads in the sand such as Australia and Canada,” it notes in a new report.

hsbc ostrichHSBC uses this graph to explain the relative unimportance of Australia and Canada on the world scene, at least regarding climate. Together they account for 2.9 per cent of emissions, while the US and China account for 43.5 per cent.

HSBC says that a China-US deal on climate is not surprising, because it had been clear that such a deal has been brewing since the formation of the US-China Climate Change Working Group in April 2013.

“However, its timing is important because now the world’s three largest emitters (China, US, EU) which account for well over half of global emissions, all have post-2020 emissions reduction pledges in place.

“Other countries (vis Australia and Canada) now have fewer excuses not to put forward ambitious pledges after Lima,” it notes.

But it says that while the carbon “elephants” of China and the US have provided positive momentum on climate change – Australia and Canada appear to have been trying to dampen this momentum – by working separately on fossil fuel exports.

hsbc fossil fuel exportsIt suggests that this is a pretty dumb move. This graph to the right shows what is at stake for Australia and Canada – they are both heavily reliant on fossil fuel exports that the world may no longer want.

“Given that fossil fuel exports accounted for over a quarter of total exports in Australia and Canada in 2012, we think these two countries should be positioning their economies for the low-carbon future, especially if they hope to export to more carbon-constrained countries,” HSBC says.

And to reinforce the point, in the context of Tony Abbott saying that he didn’t want climate change to “clobber the economy”:

“We think they are ‘right’ – because climate change regulations and a global deal to limit warming to 2°C won’t clobber the economy over the long term.

“China and the US clearly see the long-term economic benefits of putting in place climate change frameworks and positioning themselves for the global low-carbon economy of the future.

“We believe Australia and Canada risk being left behind by the global momentum on climate change whilst seeing their economic exposure to carbon-constrained countries – through fossil fuel exports – increase.”

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  • David Osmond

    Giles, regarding paragraph 3, I believe China’s target is for 20% of its ‘energy’ to come from non-fossil fuel sources. Obviously this is a much harder target than just 20% of ‘electricity’ (which I think it has just about achieved already), though the 20% of energy target also includes nuclear.

    • JonathanMaddox

      Indeed China’s electricity is already over 20% renewable, 16% from hydroelectricity alone. The world’s single largest power station, after all, is the Three Gorges Dam.

  • D. John Hunwick

    This shows in a decisive way, that China recognises the problems related to climate change and is willing to take “direct action”. Perhaps we need a Chinese Prime Minister rather than the one we have now.

  • Michael Huang

    The juries are still out to judge Tony Abott’s energy policy. And don’t get too excited about this Sino-US climate deal. First, it is just a joint declaration, not an agreement. Secondly, does anyone ever thought about if the world has enough raw materials for the manufacture of the solar panels and wind blades to replace the traditional energy generation given solar panels degrade every year. As the demand for these materials grow, they get more and more expensive, and so rendering them to be less and less competive over the long run. Thirdly, will the US Democrat Party be still in power? And we have seen grandiose promises made by world politicians to attract votes and eventually found out to be unrealistics. Australia is unique in its energy advantages, while China with such a large population and scarcity of materials has no choice but to turn to renewables to lessen its dependence on energy materials import. To them it is a matter of survival, while to Australia it is a matter of if we want to give up our natural advantages to compete in this world.

    • David Osmond

      Given that Australia has some of the best wind and solar resources in the world, I think we will maintain our natural energy advantage.

  • Blair Donaldson

    Why can’t Abbott see there are real investment and job opportunities by embracing renewables? The only explanation for his intransigence and ignorance on the matter seems to be it is completely beholden to the fossil fuel lobby.

  • Chatteris

    Obviously China and the US getting together ahead of Paris is good news, but how good? Any thoughts on Robert Wilson’s bleaker view, ‘The “Historic” US-China Climate change Deal Confirms that we are Failing in the Fight Against Climate Change’?

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