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China’s Winter Emissions Surge Could Impact Global Climate Goals

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China, the world’s largest manufacturer and exporter, is gearing up for a challenging winter as its power demand is set to soar by over 12% compared to the previous year.

This surge in demand can be attributed to the country’s ongoing economic recovery following a slump in the construction sector. Stimulus measures, coupled with positive signs in industrial output and retail sales, have rekindled hopes that China might be emerging from the worst effects of a prolonged property crisis. However, this resurgence is not without its challenges, particularly in terms of emissions, as China’s power sector heavily relies on coal for electricity generation.

 

Economic Recovery and Emissions

 

The recent recovery in China’s manufacturing and industrial sectors is a promising sign for the country’s overall economic growth. Despite factory activity unexpectedly contracting in October, analysts anticipate further stimulus measures to help achieve Beijing’s annual growth target of around 5% for 2023. Nevertheless, the economic recovery is not uniform, with some property-related segments still contracting while manufacturing and other sectors are on the rise. This uneven recovery poses challenges when assessing its impact on emissions, particularly in the power sector.

 

The power sector in China has already witnessed a significant increase in emissions during the first nine months of 2023. Emissions rose by 6.1% compared to the same period in 2022, primarily due to increased coal generation. As factories respond to rising demand for cars, clothing, electronics, and other goods, emissions from these industries are likely to climb in tandem. The extent of this increase will depend on production margins and market expectations for each product.

 

Impact on Energy Generation

 

The increase in manufacturing output, driven by stimulus efforts, has led to a surge in demand for electricity. As many of China’s production lines are electrified, this higher energy demand may result in a higher carbon footprint since more than 60% of China’s electricity is generated from coal. This raises concerns about the environmental impact of increased power generation.

 

Furthermore, the surge in emissions from manufacturing may be exacerbated by the additional demand for heating during the winter months. In November and December, temperatures in northern China tend to hit their lowest points for the year, leading to a surge in heating demand. This combination of higher factory output and seasonal heating demand could result in a sharp increase in power emissions in early 2024, despite ongoing efforts to boost clean energy capacity.

 

Travel and Emissions

 

In addition to factory output and retail sales, China’s air travel volumes also offer insights into broader economic activity and emissions potential. Domestic air travel numbers have fluctuated significantly since the outbreak of COVID-19 in 2020. While airline traffic increased sharply in 2021, it declined in 2022 due to new COVID outbreaks and lockdowns.

 

In 2023, domestic travel volumes have surged, reaching new highs despite economic concerns stemming from the property market downturn. International flight traffic has also increased, though it remains below the peak seen in 2019. If consumer spending continues to rise, driven by increased factory activity and improved economic sentiment, it is likely that both domestic and international travel numbers will continue to climb.

 

Greater consumer demand for travel will result in increased emissions from airlines and China’s refining sector. The latter will also see a boost in output for plastics and other industrial materials as downstream demand from manufacturers picks up. Additionally, the demand from factories is not limited to domestic orders, as many of China’s major manufacturers serve international markets.

 

Impact on Exports and International Demand

 

The latest data on Chinese exports of electric vehicles, batteries, solar cells, LCD TVs, and other products show strong gains in recent months. Shipments of furniture, toys, and plastic products are also on the rise. While the pace of some of these exports may slow in the short term as domestic demand improves, a sustained increase in China’s manufacturing output will eventually lead to greater availability of goods for international markets.

 

While some international markets are currently experiencing consumer soft patches due to high goods prices and interest rates, an increase in China’s output may help depress prices and stimulate international consumer demand. This, in turn, could further boost China’s economic recovery and the associated emissions.

 

Conclusion

 

China’s winter power demand surge poses both opportunities and challenges for the country’s economy and the environment. While the economic recovery is welcomed, the heavy reliance on coal for electricity generation raises concerns about the environmental impact of increased emissions. The combination of higher factory output and the seasonal heating demand during the winter months could result in a significant increase in power emissions in early 2024.

 

Additionally, increased consumer spending may lead to a surge in both domestic and international travel, further contributing to emissions. The demand for factory products, including exports, will also impact emissions and international consumer demand.

 

As China continues to balance its economic growth with environmental sustainability, it becomes crucial to find ways to manage emissions effectively while fostering economic recovery. Transitioning to cleaner energy sources and implementing emissions reduction measures will be vital in achieving these dual goals.

Wasim Qadri
Wasim Qadrihttp://wasimqadriblog.wordpress.com/
Islamabad based Senior Journalist, TV Show Host, Media Trainer, can be follow on twitter @jaranwaliya

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