Scholar: ‘China is entering global renewables market’

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A cocktail of climate damage, geopolitics and the quest for new markets is fueling a rapid Chinese move into renewable technologies such as wind, solar and wave power, Miranda Schreurs, director of the Environmental Policy Research Institute at the Freie Universität Berlin, told EURACTIV in an interview. 

Miranda Schreurs is director of the Environmental Policy Research Institute at the Freie Universität Berlin. A former government and politics professor at the University of Maryland, her work focuses on comparative environmental politics and policy in Europe, the US and East Asia.

She was speaking to Jan Vitasek of EURACTIV.cz.

To read a shortened version of this interview, please click here.

China is often seen as more committed to economic growth than fighting climate change. Is this accurate?

There have been very dramatic changes in China in the last 20 years. There were no environmental groups in early 1990s. Now there are thousands registered with the government – and presumably many more that are unregistered. The Chinese government has become increasingly active on environmental protection, partly because of the health problems that pollution is causing the Chinese people – hundreds of thousands of people each year die early from air pollution – but also because of economic costs.

China is losing its agricultural crops to pollution and parts of the country are becoming uninhabitable due to water shortages. Toxic pollution is destroying the soil bed. In the long term it won't be usable. With estimates that China is losing a few percentage points of its GDP each year to pollution, there is growing interest in environmental protection.

But making sure that economic growth continues may be even more important. China is determined to catch up with Europe and North America and the only way it can do this is if it continues to realise an eight, nine or 10% growth rate per year.

Until this century, China could achieve such growth with its own coal and oil. It did not have so many cars. But they do not have enough domestically-produced energy any more. They are being forced to import coal from Australia and oil from Indonesia and the Middle East.

They are looking at Siberia, Africa, the Middle East, and offshore for gas and oil contracts and other mineral resources. China's leaders need to secure the country's energy supplies for their long-term economic future and their regime's stability.

And one of the solutions can be renewables…

Exactly. China is moving very rapidly into renewables. They have a goal of achieving 15% of their energy from renewables by 2020. In this sense, China is moving in the same direction as the European Union although it includes nuclear energy in its 'renewable energy' definition. China had almost no nuclear power ten years ago; now they are building a nuclear power plant every year.

How many nuclear power plants are currently being planned?

It is not a huge number but I think they want to steadily increase their capacities. Right now nuclear is less then 1% of their energy supply but I think they are looking at it eventually contributing maybe 10% of their electricity supply.

They are even more interested in expanding hydro power, and investing in big hydropower projects. China has more dams than any other country. When the Three Gorges Dam started, it was supposed to supply about 8% of China's total electricity. Now it's only supplying about 2% as there has been so much growth in demand. Thus, there is a push to expand hydropower even more.

They are also going into wind power, I think because they see that there will be a bigger demand for wind, but also solar technologies in the future and China wants to be a market player.

Does China have good climate conditions for this?

China's conditions for wind power are excellent. They also have a lot of sun. They have got the whole Gobi desert, so there is a lot of potential. China is already the world's largest user of solar water heaters. They have a lot of solar water heaters on rooftops. The potential to expand into photovoltaics is also there.

China also has lots of what they call 'eco-model cities'. They pick one or two renewable energy sources and focus very intensively on them. You have got cities now that are tying-up to the wind parks and others that are pushing solar water heating or biomass.

You can do a thing like that in a centrally-planned economy.

That is true. It is an advantage, but can also be a downfall. When the government decides to shut down thousands of polluting and energy-inefficient companies, they can lay down an order and one month later the companies close their doors. But it's tough for the people who lose their jobs.

In September or October, the Chinese government closed down over a thousand coal burning facilities because of their pollution, energy inefficiency, and probably also to modernise the economy. But even authoritarian governments must weigh their actions. Too much too quickly could result in large-scale protest. 

Is China's motivation in pursuing renewables primarily economic or is there a climate aspect?

China is already being impacted by climate change. As a result of desertification, the Gobi Desert is expanding; it is now only about 50 kilometres away from the capital, Beijing. Every spring, there are massive sandstorms that shut the city down. There are days when the government warns people not to go outside because of all the sand in the air. 

It's not just in the countryside where the peasants live that climate change is happening but also in the city centres where the elite are.

Climate change is also a threat to whole sections of China's south-west, which are getting hotter and more arid. There is not enough rainfall during much of the year. Water shortages are a huge problem for the country, and China has to feed a population of 1.3 billion!

But it is not just the physical impact. China wants to be seen as a global player and climate change is a big issue in foreign policy discussions nowadays. There is not a G20 meeting where it is not discussed and China wants to be a player.

Why was there a spat between China and the US over whether commitments should be binding when China hosted the UN meeting on climate change?

My guess is that, partly, the Chinese negotiating strategy is an evaluation of what the US is – or isn't – going to do. China will not simply accept being pressured by the United States. It also wants commitments from the United States. China may have been right in predicting that the US administration might not follow through on commitments because of problems with the US Senate. The problem is that this climate change game requires both the US and China to be on board.

Does China have similar renewables market mechanisms to those in Europe?

China has tried feed-in tariffs. They are now going to a quota model. Their leadership's idea is that they need to give communities and industries some incentive to invest in renewables, but they also must push generators to actually connect the renewables to the grid.

There is a lot of potential for China-European cooperation on this issue. Europe still leads in the development and deployment of new renewable technologies, but China is becoming an increasingly big player too. And both are struggling with the question of how to increase renewables in the electricity grid.

Of course, China does not want to simply follow Europe in this area. They want to compete, and maybe even overtake Europe. China is still not developing the cutting edge renewable technologies but they very quickly entered the manufacturing field and are now one of the largest producers of wind turbines and photovoltaic cells.

Will China continue to be dependent on technology transfer – despite the intellectual property concerns of some companies  or will it start to come up with its own inventions?

China has been, by far, the dominant recipient of environmental technology transfer under the Kyoto Protocol, through the Clean Development Mechanism (CDM). But I think this will decline – it may already be declining – because China is no longer seen as a developing country, even though it really still is.

Outside big urban centres like Beijing, Shanghai and Guangzhou, China is still very much a developing country. It is one of the more advanced developing countries, one that is both rich and poor.

In the years ahead, China will be pressured to become a supplier of environmental technologies to less developed countries. China may be expected to make similar environmental technology transfers to Africa and Central Asia in the next 15 years to those they received from Europe in the last 15 years.

Since China has developed less costly technology that might be better suited to those economies, it could think about becoming an environmental technology donor. Increasingly, Europe needs to look at China as a potential partner in environmental science research and technology and not just as a developing country that is taking its technologies. Joint research and development of environmental technology should be a future goal.

The European Commission's new energy strategy involves massive investment in renewables and other green technologies. Do you see sufficient political will in Europe to meet those objectives?

Europe has been relatively good at making long-term investments. Compared to the US, it has better maintained its infrastructure over time. Still, I think that the European leadership is now recognising that if Europe does not invest in the next generation of technology, then Europe has no future.

With Europe's demographic trends, its ageing population and its relatively expensive labour inputs, Europe will only be able to compete in the long run by remaining technologically at the cutting edge and highly energy and resource-efficient. This will require Europe to enhance its energy and transport infrastructure and rapidly transition towards a low-carbon economy.

Right now, Europe needs to invest in a new, upgraded electricity grid structure that will survive for the next 50-100 years and be able to handle large amounts of renewable energies. Renewables are an intermittent energy produced when the sun shines or the wind blows. The existing grid structure is decades-old and was not designed for those kinds of fluctuations in supply.

By choosing to push in the direction of energy efficiency, renewables and green technologies, Europe is likely to develop new products and processes that it can also export to other parts of the world.

Why do you think that in many Central and Eastern European countries, many people do not believe that investments in renewables and new green technologies can boost the economy?

I think you have got countries there with a lot of fossil fuel resources. Most countries with lots of fossil fuels have a strong interest in protecting those industries. Of course, this is tied to jobs and a way of life. And fossil fuels are still cheaper than renewable energies.

But I think that if these countries do not start investing in new technologies – as China is doing – then in the long run they are going to be the losers. Sticking to the technologies of the past will not help you to develop the technologies of the future.

If carbon capture and storage (CCS) works, maybe the coal industry has a chance to survive somewhat longer, but I am sceptical that it can actually be deployed on a scale that would make it a practical solution in the coming years.

Nuclear power is often seen as more reliable source than renewables, because its energy is more constant.

Europe needs to become more integrated in its energy supply and look at the continent as a quilt with different types of renewable potentials – the wind in the North, the sun in the South, the biomass in places like the Czech Republic.

A system is needed to integrate Europe's various renewable potentials so that countries can contribute what renewable production they can but at the same time benefit from renewables generated elsewhere. Europe has enough renewable energy potential from wind, solar, biomass and other sources to create an integrated renewables-based electricity system. Nuclear power is clearly a technology that a lot of groups are interested in. But it is also very divisive.

No country has figured out yet what to do with nuclear waste. That will come back to haunt, eventually. There will probably be more development of nuclear in Europe but I do not think it will be the answer to Europe's energy and climate change problems. I think that civil society opposition will be too great to make a big push on nuclear possible.

Can you imagine a Europe, or world, with 100% renewable sources?

No, I think there will be continued use of oil, natural gas, coal. But the dominance of these fuels will decline substantially in the next decades – and need to – if you care about climate change, human health, and you recognise that demand for these energy sources is going to continue to expand but supplies will dwindle.

You have got a bigger middle class in India, in China, in South Africa, and Brazil and they too want the luxuries that we have had. Europe has the disadvantage of not having a lot of its own fossil energies. But this may also be Europe's chance to develop a low-carbon future, based on renewable energies. Of course, old ways are hard to change so it is going to be a slow shift. But it is already starting to happen.

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