The Border Between China and Russia
China Gets Back on Top
China consumes almost a fifth of the total energy consumed in the world. It contributes 17% of global GDP and is home to around 19% of the world population. The individual consumption averages 1.8 toe/year/individual, just slightly above the world average.
The country is first an industrial giant. More than half of its energy needs come from industry, by far the highest ratio in the world, the average being 33%. For 20 years, China has been the world’s “workshop”. Its buildings and transportation sectors’ energy consumption is slightly below the world average, around 0.3 toe/ year/individual for buildings (compared to 0.4 toe/year/individual world average) and 0.14 toe/year/individual for transportation (compared to 0.23 toe/year/individual world average). The main root cause of China’s energy intensity is thus related to industry, in both volume and percentage terms.
Energy consumption in China should increase by more than 50% within the next 20 years to reach 22% of total energy consumption worldwide. This growth will be related to both the continual development of its industry as well as the rising living standards of its population. By 2035 China shall be the topmost energy consumer in the world, far ahead of North America (© OECD/IEA 2014; © OECD/IEA, WEO 2012). Energy consumption per individual will rise to around 2.6 toe/year/individ- ual, slightly below Europe, but much more than the world average, which should equal 1.9 toe/year/individual in 2035 (Fig. 4.11).
Most of China’s primary energy consumption is based on fossil fuels. The country alone consumes half of the world’s coal production; renewable energies and nuclear energy only represent 13% of total energy consumption. The Chinese energy mix should evolve in the coming 20 years. Its total energy consumption shall increase by more than 50%. Oil consumption would increase by 70%, while coal
Fig. 4.11 Final energy consumption in China (© OECD/IEA, WEO 2012) consumption shall only increase by 23%. Nuclear production would be multiplied by six, natural gas consumption by five and total renewable energy production shall be two times higher than today. The share of coal in the total energy mix of China would then drop below 50% of the total energy consumption of the country (Fig. 4.12).
Actually, the main issue of China is the status of its reserves. The country has very few oil resources. Its “proven” reserves of natural gas are also small, but it would have the first “retrievable” unconventional gas reserves in the world (EIA 2013). It imports massively from other regions of the world the oil and natural gas it requires. In particular, it imports 30% of the oil it consumes from the Middle East. Although this percentage is much lower than that for India or the rest of Asia, China is very dependent on oil from the Middle East. Geographically, the country is also very close to the Eurasia region (Russia, Kazakhstan, Uzbekistan, etc.). The level of oil (and natural gas) imported today is however very small in absolute value as it does not exceed 8% of total oil consumption (and 17% of total natural gas consumption) (Fig. 4.13).
As for coal, China is the world’s biggest producer, with almost 50% of global production. At the current pace of production, China has 50 years of production left. Considering the steep growth of its consumption (which doubled in the last 10 years, and should increase by another 23% by 2035), the current depletion of reserves should lead to less than 19 years of production left by 2035. China thus has to make major changes to its energy mix or lose significant energy autonomy.
Eventually, China will have to explore the use of unconventional gas and renewable energies as components of a wider energy mix. Natural gas and oil from Siberia also offer potential; these resources are today underdeveloped in light of the massive needs of China (Fig. 4.14).
Fig. 4.12 Primary energy consumption in China (© OECD/IEA, WEO 2012)
Fig. 4.13 Energy imports from China (BP 2009, 2014; © OECD/IEA, WEO 2012)
Fig. 4.14 Coal reserves’ depletion in China (BP 2014; © OECD/IEA, WEO 2012)