Roy L Hales :
(From previous issue)
China is ready to work with the United States to make efforts in a number of priority areas and putting into effect such principles as non-confrontation, non-conflict, mutual respect, and win-win cooperation. And with unwavering spirit and unremitting efforts, we will promote new progress in building a new type model of major-country relations between the two countries so as to bring greater benefits to our two peoples and two countries.
One of the first fruits of that meeting was the announcement of China will curtail emissions after 2030. It has also committed to derive 20% of its energy from non fossil fuels. This was a historic announcement because the Chinese have not previously made commitments and they are demonstrating a new willingness to co-operate.
The announcement also aligns with their current plans for development. China’s five year plan calls for 15% of its energy to come from non-fossil fuels by 2020. Coal usage is expected is drop to 60%, from 70% currently, by that time.
If China and the US both fulfill their commitments, it will be a major blow to the fossil fuel sector. Citigroup estimates that over the next fifteen years, the oil industry will lose $1.3 trillion is revenues and coal $1.6 trillion.
Such losses raise the question of whether technologies meant to clean the industry up – such as carbon capture, dry fracking etc – are financially viable. (In keeping with President Obama’s “All of the Above” strategy, the US has set aside $8 billion to explore avenues for an environmentally friendly fossil fuel sector.)
China’s Green Transportation Sector
A recent study from A T Kearney suggests that China will have difficulty fulfilling its ambition to have 5 million EVs by 2020.
The key problems appear to be the price and limited range. Close to 60% of consumers polled said they wanted a range of at least 250 kilometres. (Thus it is not surprising to learn Chinese residents have filed 4,000 Tesla reservations!)
China’s Green Transportation sector also boasts more than 30 high speed rail routes. The 1,400 mile route from from Beijing to Guangzhou has been open since 2012. A new route, covering the 1,100 miles from from Shanghai to Guangzhou in 7 hours, opened in December
China was the second largest recipient of foreign direct investments in 2013, receiving a total of $117.6 billion. The most prominent sources:
$102.5 billion – Asian countries, Hong Kong, Thailand and Singapore
$7.2 billion – the EU
$3.4 billion – US
China’s FDI stock (including figures from Hong Kong) was $1,444 billion
China’s outgoing FDI was $107.84 billion. The largest single transaction was in Canada, where China National Offshore Oil Corporation acquired the Nexen Group for $14.8 billion.
This is slightly more than the $14 billion (70% of which came from private companies) that China invested the US. The amount of capital sunk into Europe shrank to less than $6 billion, while ventures in Latin America, Oceania, Africa and Asia grew
Renewable Investments
China invests more money into the renewable sector than any other nation. This started in 2012, with $57.9 billion and was followed by another $52.4 billion in 2013.
(Since last September, China has been acknowledged as #1 in the RECAI index.)
(Concluded)
