Science in Society Archive

Can the US-China Agreement Save the Climate?

It reflects rapid gains in renewables and associated energy storage technologies on the ground, and may well accelerate the shift in the world’s energy landscape towards a predominance of renewables Dr. Mae-Wan Ho

Historic agreement between world’s top CO2 emitters to save the climate

Late on 11 November 2014, the world’s top greenhouse gas emitters China and the USA announced a historic agreement to combat climate change [1]. This came weeks after record high greenhouse gas emissions were reported, pushing the world inexorably closer to crossing the 2 °C warming threshold that would bring catastrophic climate consequences (see Box). While Obama agreed to reduce CO2 emissions to between 26 % and 28 % of 2005 levels by 2025, China has pledged not just to reduce CO2 emissions, but to increase its clean energy use to 20 % by 2030. This agreement is generally regarded as essential to concluding a new global accord.

Global greenhouse gas emissions record high

A series of new reports [2] showed that global CO2 emissions rose by 2.3% in 2013 over 2012. The concentration of CO2 in the atmosphere reached 395 ppm (compared to the 277 ppm in 1750 before the industrial revolution). Three countries accounted for more than 90 % of the growth: China 57 %, US 20 % and India 17 %. The fourth emitter the EU actually cut its emissions so that the global rise was 11 % less than it would have been otherwise. China now emits more on a per capita basis than the EU for the first time in history. China overtook US to become the top emitter in 2007. The world’s per capita emissions in 2013 were 5 tonnes; China’s were 7.2 tonnes, the US 16.4 tonnes, the EU 6.8, and India 1.9. In 1990, China’s per capita emissions were 2.2 tonnes, and the US 19.1 tonnes. The world has already used up 2/3 of the CO2 emissions quota that climate scientists say will keep the planet from warming more than 2 °C, a threshold beyond which catastrophic sea-level rise and disruption of weather patterns are expected.

Broadly welcomed

The agreement was broadly welcomed. It changed the agenda for the G-20 summit that started three days later in Brisbane Australia, where Obama announced a $3 billion US contribution to the UN Green Climate Fund to facilitate poorer countries’ investments in clean energy [3]. The US was praised by EU council president Herman Van Rompuy, who said the deal with China makes success more likely at the next climate conference in Paris. Van Rompuy emphasizes that the 28 European Union countries are the world’s most energy-efficient region, having already cut CO2 emissions by 40 %. UN Secretary-General Ban Ki Moon said the US-China deal makes it more likely we shall have a meaningful global agreement on climate by the end of 2014. However, US congressional Republicans were critical. Incoming Senate majority leader Mitch McConnell referred to it as part of Obama’s “ideological war on coal” that will hurt the American Middle class, particularly coal miners.

Clearly there are challenges ahead, but also tremendous opportunities for the world’s top CO2 emitters.

Energy landscape by 2040 based on current trends favours renewables

On the very day that the US-China agreement was announced, the International Energy Agency (IEA) released its new World Energy Outlook [4], which makes predictions based on current trends to the year 2040, 10 years after the Chinese pledge to increase its clean energy use to 20 %.

The bad news is that world primary energy demand will be 37 % higher in 2040, despite efficiency measures. However, the good news is that demand for two out of three fossil fuels, coal and oil, will plateau by 2040, while renewable energy technologies will gain ground rapidly, helped by falling costs and subsidies, estimated at $120 billion, less than ¼ of current subsidies to fossil energy (see later).

By 2040, the world’s energy supply will be divided into four almost equal parts: low-carbon sources (nuclear and renewables), oil, natural gas and coal. Nuclear power installed capacity will grow by 60 % in the central scenario, concentrated heavily in just four countries: China, India, Korea and Russia. Despite this, nuclear power in the global power mix will remain well below its historic peak, as it faces major market and regulatory risks, and public acceptance remains a critical issue worldwide. Many countries must also make important decisions on the almost 200 nuclear reactors reaching the end of their lives by 2040, and how to manage the growing volumes of spent nuclear fuel in the absence of permanent disposal facilities.

“As our global energy system grows and transforms, signs of stress continue to emerge,” said IEA Executive Director Maria van der Hoeven. “But renewables are expected to go from strength to strength, and it is incredible that we can now see a point where they become the world’s number one source of electricity generation.”

The report sees a positive outlook for renewables, expected to account for nearly half of the global increase in power generation to 2040 and overtake coal as the leading source of electricity. Wind accounts for largest share of growth in renewables, followed by hydropower and solar. However, as the share of wind and solar PV mix quadruples, their integration becomes more challenging both from a technical and market perspective (but see later).

World oil supply is predicted to rise to 104 million barrels per day in 2040, but hinges critically on investments in the Middle East as light oil output in the US levels off, and non-OPEC supply drops in the 2020s. Demand in many of today’s largest consumers will either be already in long-term decline by 2040 (the US, EU and Japan) or have essentially reached a plateau (China, Russia, Brazil). China will overtake US as biggest oil consumer in 2030, but as demand slows, India emerges as a key driver of growth as well as sub-Saharan Africa, the Middle East and Southeast Asia.

Demand for gas will be more than 50 % higher in 2040, and is the only fossil fuel still growing significantly at that time. The US remains the largest gas producer, although production will level off in the late 2040s as shale gas output starts to drop. East Africa emerges along with Qatar, Australia, North America, and others as important sources of liquefied natural gas. A key uncertainty for gas outside of North America is whether it can be made available at prices low enough to be attractive for consumers (compared with renewables) and yet high enough to incentivize large investments.

Coal demand will slow to a near halt in the 2020s, reaching a peak in China, dropping by 1/3 in the US, but continue to grow in India.

Global energy system continues to face a major energy poverty crisis. In sub-Saharan Africa, two out of every three people do not have access to electricity. Meanwhile, costly fossil-fuel subsidies estimated at $550 billion in 2013 are often intended to help increase energy access but fail to help those that need it most; and worse, discourage investment in efficiency and in renewables.

Despite receiving more than four-fold the subsidies of renewable energies, fossil energy has been losing out to renewables in the market place (see [5] Renewable Ousting Fossil Energy, SiS 60), a testament to the cost effectiveness and competitive advantage of renewables. That is why even big utility companies are investing heavily in grid energy storage to accommodate and integrate distributed renewables, with many additional benefits in efficiency, cost savings, and stability of electricity supply [6] (Distributed Grid Energy Storage Comes of Age with Renewables, SiS 65).  

A critical “sign of stress” is the failure to transform the energy system quickly enough to stem the rise in energy-related CO2 emissions (which grow by one-fifth to 2040) and put the world on a path consistent with a long-term global temperature increase of2°C. In the central scenario, the entire carbon budget allowed under a 2°C climate trajectory is consumed by 2040, highlighting the need for a comprehensive and ambitious agreement at the COP21 meeting in Paris in 2015.

The IEA World Energy Outlook is based on current projections, tending to be on the conservative side. It has certainly not factored in the new US-China agreement. Nor does it seem to have taken into account the transformation of the national electricity grids taking place worldwide, including the United States and China, where the incorporation of energy storage at every level not only accommodates distributed renewable generation, but actively promotes them at the expense of conventional fossil fuel or nuclear plants, driven by market trends [6].

A further reason to be optimistic is China’s substantial investment in renewables for over a decade - simultaneously with its massive investment in coal-powered plants - and is now reaching a peak.

China’s big push for renewables

China’s current 5-year energy plan sets the goal of 11.4 % renewables by 2015 [7]. “The Chinese government does not make international pledges without a high degree of confidence that those pledges can be achieved,” said David Sandalow, senior fellow at the Center on Global Energy Policy at Columbia University and former senior official at US Department of Energy.

China already invested $54.2 billion on renewable energy market in 2013, placing it top of the world in investment, as well as installed capacity and generation of renewable energies (see [8] China is World's Leading Renewable Superpower). In the first three quarters of 2014, China spent a further $175 billion on clean energy projects, a 16 % jump from 2013 (according to data from Bloomberg New Energy Finance).

China’s solar investment reached a record $12.2 billion in the fall of 2014, and could well add more than 14 GW of solar capacity within the year, close to 1/3 of the global total. It already surpassed the national goal of installing 100 GW total wind energy capacity by 2015, and most likely by as much as 30 percent.

Moreover, Chinese leaders have made a crucial change to the state-controlled electricity pricing system to stipulate that wealthier households and more profitable businesses pay more for the electricity they consume. This is a big move against the price barrier that has kept coal dominant, as explained by Melanie Hart, Director of China Policy at the Center for American Progress [7]. Now the electricity market can become profitable again and you can pull more renewables into the mix.

Another important aspect of the newly announced US-China agreement is a 5-year extension for the Clean Energy Research Center. It will continue three existing tracks of research and cooperation: building efficiency, clean vehicles, and advanced coal technologies with carbon capture, use and sequestration; and in addition, a new track has been launched on the interaction of energy and water.

 In contrast, China has been slow to meet its nuclear target, which has shifted considerably. Several projects were halted following the Fukushima disaster in Japan. Sandalow noted that the increased commitment to carbon-free electricity will have a significant ripple effect: it will help bring down costs everywhere. (Germany’s commitment to renewables has already brought down the costs of electricity by 32 % since 2010 and it has definitely decided to phase out nuclear energy by 2020 as the result of the Fukushima disaster [6]).

Already, the phenomenal growth of renewable energy capacity along with rapidly improving efficiencies and tumbling costs have been putting fossil energy generators out of business and forcing a radical transformation of the electricity grid starting in Germany and spreading rapidly to other countries including the US and China within the past 4-5 years [5, 6].

US catching up on renewables along with Europe and other countries

According to the latest Energy Infrastructure Update report from the Federal Energy Regulatory Commissions’ Office of Energy Projects, all new US electrical generating capacity put into service in July 2014 came from renewable energy sources, with 370 MW wind, 21 MW solar, and 5 MW hydro [9]. For the first 7 months of 2014, renewables accounted for 53.8 % of the 4 758 MW of new US electrical capacity that has come on line, with solar at 25.8 % and wind 25.1 %, biomass 1.8 % and hydro 0.4 %. For the remaining, 45.9 % was natural gas and 0.3 % from oil and other combined. There has been no new electrical generating capacity from either coal or nuclear. Thus, the transition is happening much faster than envisaged by the IEA World Energy Outlook [4].

Renewable energy sources now account for 16.3 % of total installed operating generating capacity in US: hydro 8.57 %, wind 5.26 % biomass 1.37 % solar 0.75 % and geothermal steam 0.33 %. Actual net electricity generation from renewable energy sources in the US is about 14 % as of May 2014, according to US Energy Information Administration.

Simultaneously, large utility companies in the US, China, along with many countries in Europe, India, South Korea and Japan are making huge investments into grid energy storage that can effectively integrate distributed renewables while improving respond demand, energy efficiency, stability, flexibility and resilience of electricity supply; and saving substantially on ‘peaking’ plants, extra grid extensions, and other infrastructure requirements (see [6]). The grid energy storage business is forecast to grow from $200 million in 2012 to a $19 billion industry by 2017 [10].

To conclude

The US-China climate agreement reflects rapid gains in renewable energies within both countries driven by market trend and continuing technological innovations especially in grid energy storage at every level. It is a firm public commitment to a low carbon future by the top emitting nations that is essential to a global accord on climate change. That will in turn accelerate the adoption of renewables at the expense of fossil and nuclear energies. The world has reasons to be optimistic about saving the climate.

Article first published 21/11/2014



References

  1. “U.S. and China reach climate accord after months of talks”, Mark landler, The New York Times, 11 November 2014, http://www.nytimes.com/2014/11/12/world/asia/china-us-xi-obama-apec. html?_r=1
  2. “New reports offer clearest picture yet of rising greenhouse gas emissions”, Brian Clark Howard, National Geographic News, 21 September 2014, http://news.nationalgeographic.com/news/2014/09/140921-climate-change-carbon-budget-un-summit-environment-science/
  3. “Obama’s climate change deals change shape of G-20 summit”, Barry D. Wood, USA Today, 15 November 2014, http://www.usatoday.com/story/news/world/2014/11/14/obama-brisbane-climate-g20/19051779/
  4. “Signs of stress must not be ignore, IEA warns in its new World Energy Outlook”, International Energy Agency, 12 November 2014, http://www.iea.org/newsroomandevents/pressreleases/2014/november/signs-of-stress-must-not-be-ignored-iea-warns-in-its-new-world-energy-outlook.html
  5. Ho MW. Renewable ousting fossil energy. Science in Society 60, 32-35, 2013.
  6. Ho MW. Distributed grid energy storage comes of age with renewables. Science in Society 65 2015.
  7.  “China’s gigantic new commitment to renewable energy, explained”, Kiley Kroh, Climate Progress 12 November 2014, http://thinkprogress.org/climate/2014/11/12/3591433/china-renewable-energy-commitment/http://thinkprogress.org/climate/2014/11/12/3591433/china-renewable-energy-commitment/
  8. Ho MW. China is world’s leading renewable superpower. Science in Society 63, 46-47, 2014.
  9. “Renewable energy accounts for 100 percent of new US electrical generating capacity in July”, Kenneth Bossong, Renewable Energy World.com, 21 August 2014, http://www.renewableenergyworld.com/rea/news/article/2014/08/renewable-energy-accounts-for-100-percent-of-new-us-electrical-generating-capacity-in-july
  10. The Role of Energy Storage in the PV Industry, IMS Research (now IHS CERA) report, World, 2014. https://technology.ihs.com/461779/energy-storage-in-pv-2014

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Rory Short Comment left 27th November 2014 15:03:31
Obviously the South African government and Eskom. the electricity utility, are turning a blind eye to this kind of information as they continue to pursue coal and nuclear as the answers to our energy problems. They must have a reason for this and I can only guess that the reason is corrupt dealings particularly with nuclear suppliers.

Patricia P Tursi, Ph.D. Comment left 27th November 2014 15:03:24
When I looked at the details, the US promised to decrease emissions by 20+ percent, while China promised to decrease their emissions. China's promise doesn't mean much without quantifying. Also, the emissions may not be playing as much havoc as global geoengineering warfare. In the twentieth century, the US military reported that that the US wants to "own" the weather by 2030. We never see the sun...it's always covered by the white cloud cover from aerosol sprays. My daughter and grandson put a match to the Atlanta snow storm and it didn't melt. The website Geoengineering watch gives many details and copies of Military reports. Without the sun photosynthesis is decreased and and Vit D levels in humans is low. Estimates are that Vit D levels are deficient in as many as 80% of the world's population. Combined with the genetic engineering, the goal is to replace Nature. We are having our genetics changed through the nanoparticles. The video "What In The World Are They Spraying" focuses on Mt Shasta, CA and includes testimony from many experts. The aluminum, barium, strontium has decreased food production in Northern California. I look at this meeting as a distraction. We, in the US have our water poisoned with fluorides, our food sickens us and air and ground pollution from fracking, etc., is killing us and causing US citizens to rank at the bottom for longevity and at the top for disease and early infant and adult deaths.

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