Last week US President Barack Obama and Chinese President Hu Jintao held a landmark summit that could be a key point in the relationship between the US and China. The US and China are the world’s two largest producers and consumers of energy and also the world’s largest greenhouse gas emitters. It’s no surprise then that amongst the range of issues that were high on the agenda for discussions were energy and climate change. If the world is going to make any meaningful progress towards CO2 reduction targets the US and China will have to be at the centre of those efforts.
The energy and climate discussions held by the two presidents follow on from their establishment in 2009 of the U.S.-China Clean Energy Research Center, which has a key programme on clean coal projects and CCS. Many commentators also credit cooperation between the two countries on energy and climate issues for the positive outcome from the UN climate conference in Cancun late last year. Ongoing cooperation between the US and China is going to be critical.
What is most encouraging though is that the summit didn’t just result in a friendly agreement between two heads of state. Joining President Hu on his visit to the US were many leaders from Chinese industry, particularly the energy sector and a number of major deals have been signed that will see companies working together on the ground. A number of these deals relate to clean coal and CCS projects.
CCS provides a major opportunity for China and other developing countries to utilise their indigenous coal resources while continuing their social and economic development in a carbon constrained world. According to the IEA, developing countries will host most of the world’s deployed CCS capacity in 2050. With the inclusion of CCS in the CDM now looking more likely a pathway, financing of these projects will be better supported, helping their development. China in particular could well become a leader in moving CCS to commercial reality. Reducing the cost of CCS will be a key factor in its future wider deployment and reports indicate that China could play a key role in making this happen.
Along with recent positive developments in India, China is becoming a global leader in increasing the efficiency of coal-fired power plants. Replacing older, less efficient coal plant with larger, more efficient plant can have a positive impact on climate mitigation, at least as high as all the measures currently included under the Kyoto Protocol. The IEA has estimated that replacing older, smaller plant with newer, larger plant would result in CO2 emission reductions up to 6% globally. The existing Kyoto Protocol is intended to reduce CO2 emissions by 5%. This is because each percentage point in improvement in plant efficiency equates to a 2 to 3 percentage point drop in emissions. Building modern, efficient coal-fired power stations, which themselves are ready for later CCS deployment, will help address the energy poverty challenges that exist in China and many other countries across the developing world.
These developments in China and other developing countries, along with the support they are receiving from the US and many other countries in the developed world, demonstrate that coal can be used in a manner consistent with greenhouse gas reduction goals and is vital for long-term sustainable development. These issues are going to be increasingly important as the world prepares for the Rio+20 summit set to be held next year, which will look at how to address the world’s continuing environmental and development challenges. Energy issues will be a central component of discussions in Rio and the experience of China and India should provide an insight as to how clean coal can support sustainable economic and social development.