As the world’s largest energy consumer and emitter of greenhouse gases, the People’s Republic of China (PRC) plays a crucial role in the global struggle against climate change – but in the process it faces tough challenges dealing with the “energy trilemma” of balancing sustainable economic growth with energy security and protecting the environment.
The country has launched in recent years many initiatives to reduce its emissions, including policies to expand energy efficiency, promote renewable energy sources, and shift toward a future energy mix with a greater share for non-fossil fuels. Despite these efforts, though, the PRC economy continues to rely on coal—the most carbon-intensive fuel and single largest contributor to worsening air pollution—for two-thirds of its energy consumption, way above the global average of 24%. Moreover, coal is still expected to continue to power the country over the next 25-30 years. Even with new, more efficient plants, emissions will continue to rise.
This being the case, one essential component to curb carbon dioxide (CO2) emissions and propel the PRC on the path to sustainable, green economic growth is through carbon capture and storage (CCS), the only near-commercial technology currently available that can cut up to 90% of the PRC’s emissions from coal-fired plants. CCS, however, is still a nascent industry, with nine pilot projects in operation in the whole country.
ADB’s Roadmap for CCS in the PRC book published today puts forward a model where emissions rise and eventually stabilize at around 13.4 giga tons per year in case the government maintains climate change mitigation efforts at currentl level. In two “alternative” scenarios—both of which are consistent with the government’s pledge to peak CO2 emissions by 2030 or earlier—CCS becomes a crucial low-carbon technology for the country.
While CCS requires large upfront investments and has relatively high operating costs, it is already cost-competitive with other clean energy solutions such as offshore wind or solar photovoltaic. To date, the PRC government has made remarkable progress in building the CCS value chain through R&D activities linked to its nine pilot projects as well as international cooperation.
The PRC can benefit from the experience of countries such as Australia, Canada, Norway, the UK and the US, which together have about 14 large-scale CCS projects underway, and eight more under construction. Together, all 22 projects will be able to capture about 40 metric tons (Mt) of emissions per year, and present excellent opportunities to share knowledge and lessons learned about applying the technology.
ADB has been supporting the PRC to assess the potential of CCS technology and create the environment for CCS projects to be scaled up commercially since 2009, and the PRC is now ready to pursue large-scale demonstration. Early stage demonstration projects will mainly be in the coal/chemical sector, which offers the opportunity for low-cost carbon capture.
Many of the PRC’s coal/chemical plants are located close to oil fields that can be adapted to CO2-enhanced oil recovery, a technique that allows storage and production of incremental oil to provide a revenue stream and thereby address the twin challenges of energy security and climate change.
The new ADB book projects that from 2015 cumulative CO2 sequestration can reach 10-20 million Mt by 2020, 160 million by 2030, and 15 billion by 2050. Without CCS, the cost of meeting the PRC’s anticipated long-term climate change mitigation goals would be about 25% higher, and CCS is the only option for drastically cutting emissions from carbon-intensive industries.
Fighting climate change requires high-impact, low-carbon technologies to effectively curb emissions. Now is the time for the PRC to move forward on its plans to make CCS the cornerstone of its policy to deliver on the government’s UNFCCC pledge of peaking emissions by 2030.