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A Shell Game of Coal Dust and Green Olympics

Dave DuByne
January 12, 2008

I present to you a vision of the future: China has already leapfrogged to where we in the West will be within a decade, using coal to power our economies and cities as conventional worldwide oil production continues to decline. The pollution is the sight and smell of economic growth.

There are only 270 days left until the opening ceremony at the Beijing Olympics. by Between now and the time the torch is lit and the Green games start, 38 new pulverized-coal fired power plants will open.

Statement after statement about how this Olympiad will be environmentally friendly and the amazing lengths China is going to with regard to alternative energy power generation in Beijing is plastered around the news media daily. That is the truth – well, half of it. Media releases seem to conveniently leave out the other half of the information: While there is tremendous focus on this single city in Green development, the remainder of the country is left behind in a haze of contaminants and smokestack particulates settling on nearly every square centimeter of land except a few isolated pockets in remote mountainous areas.

On one hand, China claims to the world it is going green to help us all against climate change and pollution control. But read the newspaper s – for example, “Nation not a Threat to World Energy” in the China Daily. That article boldly claims that coal accounts for 70 per cent of the country’s energy needs and with proven reserves of one trillion tons, these reserves can satisfy Chinese demand for the next 100 years. It also paints a different picture.

We need to look deeper into the mind frame of Chinese society to understand why this is happening and why coal use is set to intensify as our planet experiences a further drop in conventional crude oil production.

Making Face: Chinese society is complex in ways Westerners overlook or do not understand. “Mianzi” or “face”, for example, is the biggest stumbling block to our understanding consumption patterns of commodities and electricity usage in modern China. “Mianzi” is best explained as reputation, social standing or how others see you in their eyes. The Chinese are pre-occupied with “mianzi” to the point that decisions made in life are all about appearance. This includes government and business decisions. In order to continue with a roaring economy that pollutes along the way,

China has to “make face” with Western governments showing that they are committed to help solve their own pollution problem from within. This is their front face, what lies behind is the true face. There are always two faces to everything in China.

Construction of hundreds more pulverized-coal-fired power plants assure coal will likely remain the fuel of choice for many decades in China. Despite economic, social, and environmental problems coal creates, it is the fuel that will allow the Chinese energy sector to continue expanding along with coal affiliated mega-corporations involved in power generation, utilities, railroads, mining and all of the jobs in between listed on the Hong Kong, Shenzhen and Shanghai stock markets. Unemployment is the biggest concern for the central government at the moment using an economic growth policy focused on creating as many jobs as possible supersedes environmental protection every day of the week.

Renewable Energy: China’s national renewable-energy law went into effect in January 2006, offering financial incentives for renewable energy development. Chinese authorities want to generate 16 percent of their energy needs from renewables by 2020; this includes small and large scale hydropower, wind, biomass, and solar power. Gargantuan expansions of nuclear power and coal to liquids projects are on the books as well.

Forecast coal output is expected to reach 2.7 billion tons in 2010. In the first half of 2007, China generated 1,122 billion kilowatt hours (kw/h) of electricity, up 13 percent from last year. During the six month period, hydro-electric generators provided a total of 156 billion kw/h, increasing 22 percent year on year; thermal-electric generators provided 940 billion kw/h, up 12 percent; nuclear generators provided 26 billion kw/h, up 15 percent, according to the China Electricity Council (CEC). Even at 16 percent renewable energy generation by 2020 the enormity of coal consumed to generate over 6 billion kW will increase total coal usage exponentially compared with today.

Predictions for substitution levels of hundreds of millions of kilowatt hours to be reached are “mianzi” driven and notoriously uncertain, if not overstated, to “gain face” on the international stage. Feasibility studies of these projections are in question especially with severe water shortages plaguing the country and talk of the country being able to reduce its reliance on coal is disheartening when looking at increases in coal mining, usage and importation in the last two years, which were the highest levels ever.

Lies, Damned Lies and Statistics: Half-truths are so common in China that there is no negative stigma attached to lying, especially if it is to “save face” for your family, self or country. For example, six months back China forbade ethanol production using human consumption grain crops because droughts and floods were set to decrease the season’s harvest. Two months back, with food prices becoming too high, the government sold stored grain at auction onto the market to bring down prices.

Amazingly, just a few days ago I read that this year’s crop harvest was a bumper harvest and grain production had increased year upon year from 2004. This is considered “saving face” by telling a half-truth. The Chinese government wouldn’t want anyone to think negatively about them since they weren’t able to grow a record harvest, so by the loosest possible definitions of “harvest”, using released stored grain figures added to this year’s harvest, the numbers came up as a bumper year.

Rural electrification is mainly where the use of renewables will be concentrated. Base metals and commodities prices make it un-economical to run electric lines into the countryside throughout the nation. For China this is a win-win situation, first by “gaining face” internationally and secondly by saving money and commodities in the process. The downside is once installed, these devices are non-job creating, they are self functioning.

You can see the “mianzi” card being played with China joining the AP6, Asia Pacific Partnership on Clean Development and Climate. Started in January 2006, the AP6 brings together China, the United States, Australia, India, Japan, and the Republic of Korea in an agreement based on clean energy technology cooperation regarding coal and carbon capture and storage (CCS) technologies. Personally I feel China is unlikely to invest in CCS systems for coal plants or heavy industry in the next decade or two due to the cost and using CCS at the new Coal–to-Liquids (CTL) projects would slow down production, but the partnership strengthens their reputation globally.

Seeking a Balance: Within China there has been a call publicly for a balance between economic growth and environmental protection. One political maneuver is to move polluting industries and antiquated factories out of urban areas. This is coded language for moving the polluters to the countryside, where sulfur dioxide and nitrogen dioxide plus other contaminants can thin out more quickly, but the side effect is coating the food producing areas where most cities rely of for food production with particulate. It is a shell game, when industry pollution is moved out of town to clean the air it is replaced with vehicle exhaust from the 16,000 new cars hitting the roads every day.

Conservation has not been mentioned once in the Five-Year Plans of the central government. Conservation=Non-Consumption. The number one agenda is job creation to keep social stability so it not considered an option, it is not talked about and it will never be discussed. Some of my students who argue for conservation when asked about the possibility of turning off all of the neon lights on building exteriors around the city firmly said it just wouldn’t be China without the lights. They are part of Chinese culture.

Some people have suggested that the Chinese are waiting for world political pressure and trade sanctions before addressing this problem in a meaningful way. It would then appear that by responding to this pressure they were conceding to world demands. My response to this is a resounding “No!” This would involve “losing face” by backing down and doing something that you are told to do by Western governments.

Instead, China makes preemptive decisions that appear to be doing something to help solve the problem with renewable energy, when in actuality they are doing the opposite – increasing their reliance on coal for primary electricity generation. Coal is also used for source heat in smelting and the heavy-manufacturing industries. It is a primary resource for home heat in the country side. Many Chinese also use it for cooking.

Life-giving Force: Coal is by no means the sole cause of China’s pollution. Many other industrial pollutants add to the mix. According to a New York Times article, “Only 1 percent of China's 560 million city dwellers breathe air considered safe by the European Union, according to a World Bank study of Chinese pollution published in 2007”. I am obviously living in the bad air 99 percent. The energy and life-giving force from the sun is literally blocked out by polluted skies for weeks on end.

Electricity consumption continues to skyrocket even though nearly every resident in China knows there is a problem. Again “mianzi” is at play. Displays of wealth and glitz are considered “face gainers”, showing off the new $500 mobile phone or driving the latest 7 Series black Mercedes are at the top of the list for individuals. Rapid expansion of the economy means taller buildings being built in the cities, which need more elaborate light displays after dark consuming even more electricity. New freeways crisscrossing the country are lined with triple sided billboards displaying endless consumer goods every 500 meters that light the night sky.

“Mianzi” is its own feedback loop. Development needs to be ever bigger and more ostentatious to show progress. This in turn drives the need to build more power plants to satisfy demand for a wealthier population. Take note: wealth generation is in its infancy and credit cards are still considered a new thing.

I sometimes hear the argument that China could effectively leapfrog over the West in developing sustainable energy and growth if its citizens get hooked on renewable power before they join the middle classes, and if its existing middle classes can learn to conserve energy before they can afford two cars. This doesn’t take “mianzi” into account. Money and physical possession are deeply ingrained in culture and religion.

Romance, China-style: I will agree with the leapfrog jump, though. As oil reserves worldwide are depleted and as economic hardship sets in, coal will be used as liberally elsewhere as it is here in China. Coal is plan B for our world economy, not solar, not wind but a resource that is plentiful, that requires no new invention or technological breakthrough that will allow a continuation of economic growth. We are all in the fix together. We purchase products manufactured here every day, and I don’t know of any joint venture or production facility that would be established if it was only to be powered with wind or solar. Industry requires a constant, reliable power source and will settle for nothing less. Coal takes the lion’s share in the Land of Dragons, and it will continue to do so.

Everything you have heard about the high levels of pollution is true and becoming worse by the day. Electric demand is insatiable; all of the building is barely able to keep up with demand. Pollution levels are expected to double or possibly triple by 2015, this is truly an un-believable statement, if it is true than there will be nothing left living in this part of the world. As Peak Oil starts to affect our planet’s economy, what I see here right now is what the future holds for us worldwide. No government will let their country crash and burn economically if there is a viable alternative. I present to you a vision of the future: China has already leapfrogged to where we in the West will be within a decade, using coal to power our economies and cities as conventional worldwide oil production continues to decline. The pollution is the sight and smell of economic growth.

Looking at the future in front of me, gazing off of my balcony downtown holding my girlfriend’s hand, I think to myself, “Construction crane silhouettes in the smog at sunset. How romantic.”
January 12, 2008

David DuByne teaches business English in Chongqing, China while keeping an eye on energy, commodities and bio-fuel production in Asia. His website - Dave's ESL biofuel - is devoted to bio-fuel and oil depletion.

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