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Chinese migrant workers of CREC labor at the construction site of the Huai 'an East Railway Station for high - speed Railway.
China railway group company of migrant workers in the high-speed rail "huaian station construction site work. Image: Cynthia Lee/Alamy agency.
5 October 202014:58

After the analysis: China's "new crown" three times as much as a key project of fossil fuels in the "low carbon"

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05.10.2020 | 2:58 remaining PM
Translations After the analysis: China's "new crown" three times as much as a key project of fossil fuels in the "low carbon"

On the analysis of the spending plan, according to China's energy consumption and production province is to fossil fuel injected hundreds of billions of dollars of capital project.

If the investment plan into practice, its size will be more than the "low carbon" energy spending three times.

The findings from our eight provinces in China "major projects list" (hereinafter referred to as the "listing") of the latest analysis, these provinces half of China's carbon dioxide emissions."Listing" embodies the provincial government in economic recovery after the "new crown pneumonia" focus, as well as the expected early next year, released by the "difference" planning (i.e., "the 14th a five-year plan outline") do preparatory work.

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We were identified from the "listing" total price is 19.9 trillion yuan (about $2.95 trillion) of 4348 projects.A total of about 6.2 trillion yuan (about $0.91 trillion) investment to energy or transportation;Among them, the fossil fuels and railway projects accounted for about a third each, up to 2.1 trillion yuan.

, by contrast, in the energy or transportation spending plans, to "low carbon" project investment is relatively small, renewable energy project of 340 billion yuan (about $49 billion, accounting for more than 5.6%), nuclear power project of 120 billion yuan (about $18 billion, accounting for more than 2.0%), electric vehicles, battery and energy storage project a total of 80 billion yuan (about $11 billion, accounting for more than 1.3%).

Our results show that the Chinese for "new crown pneumonia outbreak's recovery plan focused on the" high carbon "energy and infrastructure, with the 2008, 2009 after the turn of the global financial crisis stimulus plan.Once again, however, the surge of 2010 emissions is unlikely, because at the current size of the "new champions" stimulus measuresIs far less thanAt the time.

Nonetheless, continued investment in fossil fuel infrastructure against the country strive to commitment of "carbon dioxide emissions peak" as soon as possible, also caused the chairman xi jinping made this week by 2060 "carbon neutral"Accidental commitmenttheA lot of questions.

Investment plan

Each year, the provincial government will compile a list of "key projects".Projects included in the "list", revealed the government's support, this for developers opened the gate got the license for the project and project finance.

Although appear on the "listing" is not enough to guarantee the project get "pass", but the "listing" reflects the provincial government and the state-owned enterprise policymakers focus.

We analyzed China's energy production and energy consumption of most projects list of eight provinces, namely, guangdong, hebei, henan, Inner Mongolia, jiangsu, shanxi, shandong and shanxi.

The map - of - China

Chinese provinces.Drawing: carbon presentation.Source: Esri.Disclaimer: this map used by the name of the presenting methods and materials, does not represent the bulletin of the carbon is, in any country, territory, city or area or the legal status of its authorities, or on its borders or boundaries drawn comment.

These provinces inhabited by one third of the population in China, produces 50% of carbon dioxide, contributed 43% of GDP and 37% of investment in fixed assets.Among economic stimulus in 2008, the province also played an important role in its capital spending has increased by 40% year-on-year.

We from the statistics of the provinces of the total price is 19.9 trillion yuan (about $2.95 trillion) of 4348 projects.About two-thirds of the investment to have no direct relation with the energy industry, including information and communications technology (ICT) infrastructure and manufacturing, and other energy-intensive manufacturing, tourism, health care, education, culture and sports, etc.

The remaining one-third to energy and transport investment (see chart), its potential investment of 6.2 trillion yuan (about $0.91 trillion).Rail and fossil fuels, as shown in the figure below the main body of investment for the spending plan, assigned to a "low carbon" energy and the share of electric cars are much smaller.

According to the classification of eight provinces in China in the
According to the classification of eight provinces in China in the "list of major projects" fossil fuels spending plans (unit: one billion yuan).Source: CREA analysis of public project lists and news reports.This chart used by carbon briefingHighchartsProduction.

In our analysis, flow to the railway investment is the largest single category of spending plans, accounting for 36% of the energy expenditure;Close is fossil fuel related projects, accounts for about 35% of the energy expenditure.Road construction was third, accounts for just over 10%.

All of these plans "low carbon" energy investment (renewable energy, nuclear power and hydropower project), accounts for about 10% of the energy related investment.Well below the list of fossil energy project investment, the scale is nearly three times as much.

Together, only 13% of spending plans can be classified as a generalized "low carbon", including renewable energy, nuclear power, hydropower, power grid, electric vehicles and battery.

Metals industry for energy intensive investment scale level similar to renewable energy.

The key provinces

The analysis of selected eight provinces is the most important of China's energy consumption and energy production province.Only from the point of view of energy related spending plans, most of these provinces to fossil fuels.

As shown in the figure below, in eight provinces, only in guangdong and hebei provinces will be more capital spending to low-carbon energy sources rather than fossil fuels related projects.

According to the classification of eight major provinces of China's energy related spending plan (unit: percentage).Source: CREA based on public projects list and publicly reported the analysis.Source: CREA analysis of public project lists and news reports.This chart is made by carbon presentation use Highcharts.
According to the classification of eight major provinces of China's energy related spending plan (unit: percentage).Source: CREA based on public projects list and publicly reported the analysis.Source: CREA analysis of public project lists and news reports.This chart used by carbon briefingHighchartsProduction.

Although hebei "major projects" list contains a large number of renewable energy and hydropower project, but also focus on enhancing energy intensive industrial capacity of metal.Therefore, in the investment plan of hebei province, "high carbon" project as the main body.

In the "difference" planning to compose, the expenditure of the planned project embodies the focus of the provinces.These provinces might be inclined to the same department (or even the same major projects) into the "five-year plan", in order to further expand or financing.

Fossil fuel imports

In the categories of "fossil fuel", our data highlight a theme, namely self-sufficiency and import substitution.As shown in the figure below, the fossil fuel investments in the first three categories are related to the target.

By increasing refining capacity, China will be crude oil import prices lower, instead of expensive oil products.By investing in coal chemical industry, coal raw materials will also be able to replace part of its oil imports.Development coal transportation is located in the inland province coal producer, which can make its from the competition with foreign miners, coastal consumers and supply.

According to the classification of eight major provinces of China's energy related spending plan (unit: percentage).Source: CREA based on public projects list and publicly reported the analysis.Source: CREA analysis of public project lists and news reports.This chart is made by carbon presentation use Highcharts.
According to the classification of eight provinces in China in the "list of major projects" fossil fuels spending plans (unit: one billion yuan).Source: CREA project based on public listing and the analysis reported in this chart used by carbon briefingHighchartsProduction.

Such investment supported by two central policy: chairman of the acquisitionThe recent emphasis onThe "binary" and prime minister li keqiang earlier onEnergy securityAttention.The two policies are repeatedThe domestic supply and import substitutionThe importance of.

The policy could significantly promote the domestic coal chemical industry and oil and gas production.Provincial project list lists a long series of coal chemical industry plan, reveal the industry after hope turnedIn violation of "false start"" old scores", revive industry development ambitions.

Coal chemical industry

In our analysis of China's provincial government investment project, "jump" popular project, a total of 35 project, target a total investment of RMB six hundred billion yuan ($90 billion).

Considering this is the emerging industry, not the actual landing project, these big investment plan is particularly noteworthy.

"Jump" to use coal instead of hydrocarbons as raw materials to produce petrochemical products.Everything: its products from the synthesis of liquid or gaseous fuel to plastics, fertilizers, etc., to name but a few.

Adopt the technology route of "carbon intensity" is higher than traditional petrochemical industry.This will not only means "locking" expectations running life long fossil fuel infrastructure, also means increasing emissions intensity of fossil fuel consumption.

Relying on the domestic coal resources development of large petrochemical industryFor a long timeAt the policy level, after several ups and downs.Even in the "twelfth five-year" plan period (2011-15 years)Highly regarded, but limitedeconomic, technology andThe environmentBlock, only a small part of the project was built.

Oil refining

Our data, "refining" is another very prominent plan investment categories, seven large projects involved.This means that 420 billion yuan (about $70 billion) investment and annual output of more than 80 million tons of refined oil products new capacity, enough to in2019 /On the basis of expansion of 14% again.

China is second only to America's globalThe second largestOil refining.Like coal and iron and steel, China's refining industry is faced withovercapacityProblems, especially low end products such as gasoline and diesel.But the country's most high-end petrochemical products still rely on imports.

The current"The petrochemical industry "five year planPut forward ", should be in shandong, hebei, jiangsu, Shanghai, zhejiang, guangdong and fujian, seven very large petrochemical industry base construction.In our analysis, the planning of major petrochemical investment in shandong, hebei, jiangsu and guangdong provinces such as data.

In northern China, a new railway line across the heilongjiang province.Source: Ashley Cooper/Alamy agency.

Investment in refining are both for reasons of national security, and to the country's transition from the "net importer of refined oil to" exporters ".

Power generation

As mentioned earlier, most of the planned investment of fossil fuels to reduce our dependence on oil imports.Most of these moves outside of the power sector.

Efforts to promote energy securityIs unlikely toEndanger the development of renewable energy.Instead, to energy security considerations should be paid attention to China as one of the world's largest producer of renewable energy equipment status, complete local supply chain and cost competitiveness.

After brief trough in 2019, China's investment in renewable energy present a growth trend.Last year, ChinalaunchAbout 21 gigawatts (GW) pegged to the benchmark price of coal area of "no subsidies" wind and solar energy projects.This year, the country was announced44 gw(GW) of similar projects, the total investment of about 270 billion yuan (about $40 billion).

Large-scale popularization of renewable energy, and cost and coal flat facts show that the first appearance of the size of its economy has advantages.Nevertheless, our analysis suggests that the provinces planners still continueDirect investmentTo coal, causing a significant growth in the number of projects this year.

After a greenpeaceA baseline surveyFound that Chinese provinces investment plans a total of 2020 contains 48 gigawatts (GW) of coal project.And the echo, this analysis involves eight provinces 32 projects with a total installed capacity of 32 GW (GW).

However, these coal project involves the investment of about 170 billion yuan less than renewable energy, nuclear power and hydropower dedicated spending half of the total.

The "new" infrastructure

Nowadays "to" new infrastructureHot attentionDid not reflect in spending priorities of our analysis."New construction" usually includes 5 g, "Internet of things", industrial Internet, cloud computing, chain blocks, data center, intelligent computing and intelligent traffic, etc.

Although such projects numerous (especially the electric automobile, battery, charging station, smart grid, etc), but their average cost is low, compared with only a few refiners spending plans, has been in the shade.

The investment plans did not show much sign of "economic diversification" : heavy reliance on fossil fuels provinces still seems keen to continue to deepen its dependence, has the largest iron and steel industry in hebei province also continue to lead the metal manufacturing investment.

In the spending plan, or may be considered as "green" or "low carbon" a view is: a lot of special funds are to railway, beyond the road special investment to three times.

The world's leadingChinese "high-speed rail network has been successfully implemented the" low carbon "of domestic travel.However, if determined to expand, tracks only sparsely inhabited areas of the connection.In these areas of new railway lines, running low emissions generated by the load factor train,May be more thanAvoid the reduction of air and road travel.

High carbon recovery?

China from the 2007-09 recovery in "the global financial crisis," the unprecedentedHeavy industry and construction industry growth plans, the carbon dioxide emissions created unprecedented single countries record fastest rate in three years.

In China's policy makers to remove the "new champions" after the blockade to seek to stimulate economic recovery plan, design, global emissions faces a key question is: whether the pattern will repeat itself.

Most of the current economic recovery driven by public investment;In the meanwhile, private investment and consumptiondepressed.This caused many analysts in the mouth"Two speed" recovery.

The energy industry plays a central role.Even if the overall spending in August 1 - more than 2019 levels fell slightly, energy is still one of the few investment spendingDouble-digit growthOne of the industry.

An influx of public spending, or to accelerate transformation provides a low carbonBig opportunity.The highest political decision-makers, however, was not systematically emphasis on "green" or "low carbon" infrastructure.Our analysis confirmed that the result is that China is missing around the "low carbon" China's economic recovery.

However, if only in terms of scale, and the current stimulus didn't seem to make the mistake in 2008.On the issue of GDP, China is more than a decade ago prudent.When the investment spending grew by 30% in a year.This year, the total investment of almost no growth from a year earlier.

, things that lead to China's stimulus policy preferences fossil fuel system and institutional factors still exist.

Xi in 2060 announced this week by the chairman of the "carbon neutral" goal, with previous target, carbon emissions peak may indicate (central) will redeploy spending priorities.

Xi jinping in the general assembly on WednesdayTo speakSaid, China will strive to carbon dioxide emissions by 2030 "peak", and strive to achieve "carbon neutral" by 2060.He also promised to "expand" in ChinaThe Paris agreement"2030 climate commitment".

Oil refinery and railway marshalling yard, China.

A is located in China's oil refinery and rail yards.Source: Zoonar GmbH/Alamy agency.

The speech is short, but it left manyInterpretation of the space.This is one of the most lack of ambition interpretation, China can also use ten years to continue to build infrastructure more fossil fuels, emissions will continue to increase.More aggressive interpretation is that China will immediately to curb emissions growth, and in 2030 before entering a state of a significant reduction in emissions.

In our analysis, we identified "high carbon" the fate of the infrastructure project investment projects or can become the a key indicator of a speech in the short term.

As for the present actual situation, hundreds of billions of investment flows of coal power plants, coal plants, refineries and other "high carbon" capacity.Life expectancy for these projects will be far more than the middle of this century.

The research methods

Our data from public access from the provincial development and reform commission website "major projects list" of eight provinces, supplemented by investment plan related news reports.

4348 projects established in the us, 72% of the project contains the project cost estimation.We use a kind for average cost, estimate the cost of the rest of the project.

Project list most of the plan is only a name, so we use network query for further information.When there is a clear information indicates that the purpose of a project (such as coal transportation or renewable energy equipment), we will be classified.

A lot of "other transportation infrastructure investment may be associated with coal and other energy, but it is not further subdivided.

Many manufacturing and energy project labeled the "new materials", "new energy" or "new energy vehicles" label.In as much as possible, we try to evaluate the basis of using these labels.For example, in our "electric car" category, includes only specially used in the manufacture of electric cars or electric car parts manufacturing facilities, and does not include those for electric cars, but use a wide range of components.

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