Chinas Changing Energy Needs

Share

Chinas Changing Energy Needs

Chinas energy mix is projected to change out to 2035, with coal consumption declining though still remaining dominant as nuclear and renewables make inroads in the country, according to the 2017 BP Energy Outlook.

The outlook projects that Chinas share in global energy demand will rise from 23 percent in 2015 to 26 percent in 2035, while its growth contributes 35 percent to the worlds net increase. The energy mix in China is likely to change significantly during the next 20 years, driven by its changing economic structure and a policy commitment to move to cleaner, lower-carbon fuels.

Get alerts when new Sustainability Blog articles are available.

Loading

Global coal consumption is expected to peak at nearly 4.1 billion tons of oil equivalent in 2025 to 2030 before declining slightly to 4 billion tons of oil equivalent in 2035. The big driver of coals declining fortune is China, BP Group Chief Economist Spencer Dale said during an online webcast Jan. 25. Dale noted the changing pace and pattern of economic growth, combined with the countrys commitment to reduce its dependency on coal. Chinas consumption of coal rose rapidly as it industrialized during the 1980s and 1990s, but that trend is over, he said, and Chinas coal consumption is expected to grow at a sharply slower rate and eventually start to decline.

After providing almost two-thirds of Chinas increasing energy needs over the past 40 years, Chinas coal consumption is projected to broadly plateau over the outlook, BP said. As a result, the share of coal in Chinas energy demand falls from around two thirds in 2015 to less than 45 percent by 2035.

However, China is expected to remain the worlds largest consumer of coal throughout the outlook period, accounting for 47 percent of global coal demand in 2035. During the outlook period, Chinas coal consumption is projected to decline slightly to just shy of 1.9 billion tons in 2035.

Much of this reduced coal share is expected to be replaced by renewables, nuclear and hydroelectric power, which will supply more than half of Chinas increasing energy demands over the BP outlook period. The combined share of these fuels in Chinas energy mix is projected to rise from 12 percent in 2015 to more than 25 percent by 2035.

Consumption of renewables in China, including biofuels, is expected to grow from about 65 million tons of oil equivalent in 2015 to 503 million tons of oil equivalent in 2035, a 673 percent increase during the 20-year period. China is far and away the largest source of growth, adding more renewable power than the EU and U.S. combined – another consequence of the changing China energy landscape, he noted.

Nuclear energy consumption is projected to increase nearly 650 percent from 39 million tons of oil equivalent in 2015 to 288 million tons of oil equivalent in 2035.

Hydroelectric power in the country is expected to grow nearly 500 percent, from 255 million tons of oil equivalent in 2015 to 352 million tons in 2035.

Chinas demand for energy is projected to grow by less than 2 percent per year over the period of the outlook, compared with more than 6 percent over the past 20 years. According to BP, the slowing reflects continuing sharp declines in energy intensity as economic activity within China gradually shifts away from energy-intensive industrial output towards more energy-light consumer and services activity, and as policies drive further improvements in energy efficiency. Chinas energy intensity – the amount of energy required to produce each unit of GDP – is projected to decline by 3 percent per year over the outlook period, significantly quicker than the projected global average, and converging on U.S. levels by 2035.

Photo: Shubert Ciencia / Flickr

Dale said that the main story in the companys report this year is about the energy transition that is taking place and is likely to continue to take place over the next 20 years. On the demand side, theres a shift in the pattern of demand – away from the U.S. and Europe to fast-growing Asian markets, Dale said. On the supply side, the story is one of a continuing shift in the fuel mix towards lower carbon fuels.

Total global energy demand is projected to grow an average of 1.3 percent per year to 2035. He said energy demand will rise because of increasing prosperity in Asias developing nations, with more than two billion people lifted from low incomes over the next 20 years. Its this burgeoning Asia middle class that drives the growth in energy demand, he said during the webcast.

The 2017 BP Energy Outlook documents may be downloaded from the BP website.

Related Topics

Asia    Business    China    Region