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China’s Path of Energy Transition in the New Era

2024-10-12 | scio.gov.cn

The world is currently witnessing a new revolution in science, technology and industry. Green and low-carbon development, digital and intelligent technology, and sustainability have become the overwhelming trends of our times. Despite differences in development stages and available resources, all countries share the goal and challenge of securing their energy supply and achieving a green and low-carbon transition. Guided by its new energy security strategy, China has made significant progress in its energy transition, contributing its solutions to a key global issue of our time, demonstrating its approach to governance, and fulfilling its responsibility as a major country.

1.Energy Transition Is the Only Way Forward

The development and utilization of energy is an important aspect of the interaction between humanity and nature. When reviewing the history of human development, we see that every significant human progress is fundamentally tied to changes in energy extraction and utilization and shifts in primary energy sources.

Over the years, China has established a comprehensive energy supply system encompassing coal, oil, gas, nuclear, hydro, wind, and photovoltaic (PV) energy, providing robust impetus for the fast and sustained development of the economy and society.

China’s drive towards all-round socialist modernization has brought about new requirements for high-quality energy development. Despite being the world’s largest developing country, China has comparatively low per-capita energy consumption. As the country has not yet completed its industrialization and urbanization, however, its energy demand is likely to continue growing. With an industrial structure dominated by heavy industry and an energy mix primarily based on coal, China will continue to face resource and environmental constraints in the long run. Energy transition is the fundamental solution to the above challenges.

China’s energy transition focuses on transforming the model and drivers of energy development by achieving the substitution of primary energy sources from fossil fuels to non-fossil fuels. This transition is essential for the country to overcome resource and environmental constraints and achieve its peak carbon and carbon neutrality goals. It is vital for the country to seize the opportunities brought about by the latest round of revolutionary changes in science, technology and industry and foster new quality productive forces. It is crucial for the country to establish green ways of production and life and realize high-quality economic and social development. It is key for the country to fulfill its responsibility as a major country and contribute to a global community of shared future. For these reasons, China has taken proactive actions to advance its energy transition and will stay committed to this initiative as an imperative for a better future.

2.Accelerating Energy Transition

China respects the global trend of energy development and firmly applies its new energy security strategy. To achieve harmony between humanity and nature, and advance human progress, China has been shifting from a resource-reliant model of energy development to one driven by innovation. The country has charted a path for energy transition that is tailored to its own realities and responsive to the needs of our times.

China’s energy transition abides by the following principles:

- Putting the people first. Energy is inseparable from daily life. By upholding a people-centered development philosophy, China has improved its energy services throughout society to secure a reliable supply of clean energy and ensure that the people have a greater sense of gain, fulfillment and security.

- Pursuing green and low-carbon development. Energy transition is critical for balancing economic growth and eco-environmental protection. China adheres to green and low-carbon development that prioritizes eco-environmental protection and promotes harmony between humanity and nature. Energy transition is a vital objective for economic and social development in the country. China has made energy and resource conservation a top priority and employs a comprehensive conservation strategy while raising energy efficiency by making the best use of every bit of coal, oil and electricity. Guided by its green and low-carbon philosophy, China has taken vigorous measures to substitute renewables for fossil fuels and aims to create an energy supply system dominated by non-fossil fuels.

- Serving national development. To ensure that it always has control over its own energy supply, China has increased its capacity to meet its domestic needs. The country has applied the practice of establishing the new before discarding the old and implemented strong overall planning to ensure that safe and reliable new energy is secure before phasing out conventional energy. China has improved its energy production, supply, storage and sale systems while shoring up the weak points in its energy reserve regulation and using fossil fuels as safeguards of energy security, thus forming an effective response strategy to energy security risks and challenges.

- Boosting innovation as an impetus for growth. Innovation is the key to energy transition. By applying an innovation-driven development strategy within its energy sector, China has achieved breakthroughs in core technologies and created new technologies, industries, and business models. It aims to make new energy technology and its related industries the key drivers of industrial upgrading and foster new quality productive forces. China has also advanced market-oriented reform in its energy sector by ensuring that the market plays the decisive role in resource allocation and the government better plays its role, in order to boost the vitality of all business entities.

- Expanding opening up and cooperation. Sustainable development and climate change are common challenges for all of humanity. Holding the vision of a global community of shared future, China has been expanding high-standard opening up in the energy sector, strengthening all-round international cooperation, and advancing an energy transition towards green and low-carbon development through mutually beneficial cooperation. China has played an active role in the reform of global energy governance to help build a governance system based on equity, justice, balance and inclusiveness.

3.Making Notable Progress in Energy Transition

Over the past decade, China has furthered reform of its energy production and consumption methods, upgraded its energy supply capacity under the guidance of its new energy security strategy, and achieved historic breakthroughs in green and low-carbon energy development. These achievements have provided strong support for realizing high-quality economic and social development and better meeting the people’s growing desire for a better life, and served to underpin the Beautiful China initiative.

Fast-tracking clean energy development. In 2023, the share of clean energy consumption reached 26.4 percent of China’s total energy use, up 10.9 percentage points from 2013. In the same period, the share of coal consumption dropped by 12.1 percentage points. In 2023, the total installed capacity of power generation reached 2,920 GW, of which clean energy accounted for 1,700 GW, or 58.2 percent. In the same year, electricity generated from clean energy was about 3,800 TWh, accounting for 39.7 percent of the country’s total electricity generation, up by around 15 percentage points from 2013. Over the past decade, electricity generated from clean energy has accounted for more than 50 percent of the increase in total electricity consumption, marking a growing share of green energy in China’s energy mix.

Underpinning high-quality economic and social development. China has realized greater control over its own energy supply. Over the past decade, its capacity for primary energy production has grown by 35 percent, providing a strong basis for steady and sound economic growth. In the same period, investment in fixed assets in the energy sector totaled about RMB39 trillion, which has stimulated the growth of investment in upstream and downstream industrial chains and related industries. A series of key energy projects have been completed and put into operation, and a complete industrial chain for energy equipment manufacturing has been built. Technological innovation in new energy, hydropower, nuclear power, power transmission and transformation, and novel energy storage has accelerated, and the clean energy industry has become a new pillar of China’s modern industrial system.

Meeting the people’s need for a better life.

Over the past decade, China’s energy demand and supply have remained balanced. Energy prices have also remained generally stable, ensuring energy security for more than 1.4 billion people. Per-capita electricity consumption has doubled from about 500 kWh to nearly 1,000 kWh over this period, and the total number of natural gas users has reached 560 million. China rose to a rank of 12th in Getting Electricity, an indicator of the global business environment by the World Bank.

The energy sector has helped to facilitate poverty alleviation and rural revitalization. Over RMB100 billion from the central budget has been invested into upgrading rural power grids, stimulating local governments and enterprises to increase investment and enabling all areas of the country to have access to electricity by 2015. The scale of household PV power installations in rural areas has reached 120 GW, across more than 5.5 million households. This has led to an income increase of RMB11 billion for farmers and the creation of around 2 million jobs per year.

Measures have been taken to meet the growing demand for green energy. By the end of 2023, the proportion of clean energy heating in northern China approached 80 percent; the total number of charging facilities for new energy vehicles nationwide increased from less than 100,000 in 2013 to almost 8.6 million.

Synergizing with high-standard eco-environmental protection. Over the past decade, average coal consumption of coal-fired power generation has reduced to 303 grams of standard coal per kilowatt-hour, with SO2 and NOX emissions of advanced coal-fired power generation units now comparable to the upper limits for natural gas power units. From 2013 to 2023, energy consumption per unit of GDP decreased by more than 26 percent, and the quality of China’s refined oil products consistently improved to reach advanced international levels. The number of coal-fired boilers and power plants has decreased by more than 80 percent nationwide, and almost all bulk coal has been replaced with clean energy for winter heating in and around the Beijing-Tianjin-Hebei Region and in the Fenhe-Weihe River Plain.

Green and intensive development of energy and resources has been realized, green technology for energy and resource development has been widely applied, and the eco-environment of mines has seen significant improvement. The PV-based environmental restoration model has been successfully introduced in desert and coal mining subsidence areas. The average concentration of PM2.5 has fallen by 54 percent over the past decade, and the number of days with heavy pollution has decreased by 83 percent, serving to underpin the Beautiful China initiative.

Contributing to global energy transition and a clean and beautiful world. In 2023, China’s investment in energy transition reached US$676 billion, making it the world’s largest investor in this field. Over the past decade, China has provided premium clean energy products and services to the international market. The country has also doubled its efforts in technological innovation to upgrade new energy technology at a faster pace, contributing enormously to a sharp reduction in the costs of wind power and PV power worldwide.

Through expanding opening up and cooperation, China has worked with more than 100 countries and regions on green energy projects. A large number of signature projects involving nuclear power, hydropower, and new energy have been completed. In 2023, China’s exports of wind power and PV products helped other countries reduce carbon dioxide emissions by about 810 million tonnes. China’s new energy industry has added to the global energy supply, eased global inflation pressures, and contributed to the global effort to combat climate change and transition to green development.

Source:

China’s Energy Transition

The State Council Information Office of the People’s Republic of China website <www.scio.gov.cn/zfbps/zfbps_2279/202408/t20240829_860523.html>

Edited by Lianying Bao