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China and the Global Energy and Emissions Landscape
with Reference to Africa and Oil
Moustapha Kamal Gueye
Senior Programme Manager – Environment Cluster, ICTSD
Moving ideas, pursuing solutions
China and Global Energy Demand
Climate Scenarios in the IEA World Energy Outlook
• 550 ppm Policy Scenario: Global temperature at 3 degrees - Energy-related CO2 emissions rise from 27 Gt in 2006 to 33 Gt in 2030. The share of low-carbon energy in global primary energy mix increases from 19% in 2006 to 25% in 2030.
– Global investment in energy-related infrastructure and equipment in 2010-2030 is $4.1 trillion (or 0.25% of annual world GDP).
• 450 ppm Policy Scenario: Global temperature at 2 degrees - Energy related CO2 emissions drop sharply from 2020 onwards, reaching 25.7 Gt in 2030.
– Low carbon energy accounts for 40% of global power generation by 2030.
– Global energy investment is $9.3 trillion, or 0.55% of annual world GDP.
Fossil Fuel Dominate Global Energy Mix in 2030 IEA Reference Scenario
IEA WEO 2008: Global demand expands by 45% between now and 2030 – Fossil fuels account for 80% of the world’s primary energy mix – Oil remains the dominant fuel, but coal accounts for more than 1/3 of the overall rise – Renewables grow most rapidly, overtaking gas after 2010 to become the 2nd largest source of electricity behind coal.
China and India Drive the Rise in Global DemandIEA Reference Scenario, 2006-2030
India’s demand grows at 3.9% per year, followed by China, at 3.5% – Non-OECD countries account for 87% of the increase – Demand in OECD drops – Cumulative investment in energy-supply infrastructure amounts to $26.3 trillion to 2030.
Change in Oil Demand by Region in the Reference Scenario, 2007-2030
All of the growth in global oil demand comes from non-OECD, with China contributing 43%, the Middle East 20% and other emerging Asian economies most of the rest
China and Global GHG Emissions
World Greenhouse-gas Emissions
Energy-related CO2 emissions will continue to be the main source of GHG in all scenarios
Energy-related CO2 Emissions in the IEA Reference Scenario
Non-OECD countries account for 97% of the projected increase in energy-related emissions between now and 2030 – 3/4 coming from China, India & the Middle East alone
Reductions in Energy-related CO2emissions in the Climate Policy Scenarios
Improvements in energy efficiency provide the greatest potential for emissions cut – Increased deployment of existing low-carbon technologies accounts for most of the CO2 savings
Implications for Global GHG Reduction Efforts
OECD countries alone cannot take the world to a 450-ppm goal, even if they were to reduce their emissions to zero. Hence the importance of enabling and supporting National Appropriate Mitigation Actions in developing countries
Facing an Unprecedented Challenge
• "It took developed countries several decades to solve the problems of saving energy and cutting emissions, while China has to solve the same problem in a much shorter period. So the difficulty is unprecedented”
Chinese Premier, at Beijing High-level Conference
on Climate Change Technology
China, Africa and Oil Trade and Investment
Meeting China’s Energy Demand
• China’s primary energy demand is projected to more than double from 2005 level to 2030.
• In the IEA Reference Scenario, net coal imports reach 3% of its demand and 7% of global coal trade in 2030.
• China’s net oil imports jump from 3.5 mb/d in 2006 to 13.1 mb/d in 2030, as conventional oil production in China peaks in the next decade and starts to decline.
Growing Oil Demand from Africa
China’s imports from Africa as a share of China’s global imports
Share of Africa's Exports by Destination
Average annual merchandise export growth rate, Africa to AsiaShare of Africa's exports
by destination
Source: Broadman, 2007
Product Distribution of Africa’s Trade with China
Africa's merchandise exports to China, 2004
Africa’s Exports to China by Commodity Groups
Chinese FDI in Africa
Chine FDI flows to Africa and their % growth
2004 Chinese FDI outflows
Source: Broadman, 2007
Transfer of Technology and Skills
• The 2006 white paper on “China’s Africa Policy” seeks to promote cooperation in technical knowledge for development.
• A World Bank survey (Broadman, 2007) found that in engineering services, in general, Chinese firms sub-contract services to local firms, providing opportunities for acquisition of experience and access to technology.
• However, African firms are not equally benefiting from acquisition of experience and access to technology through sub-contracting, because in many cases, Chinese firms import all materials, technology and staff from China.
Oil/Gas Exports: Development Spillover for Africa?
• Government revenues from oil and gas in the top ten oil and gas producing African countries is projected to rise from some $80 billion in 2006 to about $250 billion in 2030 – with a cumulative revenues of all ten countries over 2006-2030 reaching $4.1 trillion (IEA, 2008).
• Less than a third of households in the majority of these African countries have access to electricity or to clean fuels for cooking, like LPG, kerosene, biogas and ethanol gelfuel.
• An estimated $18 billion is needed to achieve universal access to electricity and to LPG cooking stoves = 0.4% of the projected cumulative government revenues from oil and gas export revenues in 2007-2030.
• With the right policies, oil and gas revenues can contribute to alleviating energy poverty in African countries and to a sustainable energy transition
Thank you
International Centre for Trade and Sustainable Development (ICTSD)
www.ictsd.org
ICTSD is the publisher of BRIDGES Between Trade and Sustainable Development© and
BRIDGES Weekly Trade News Digest©, and co-publisher ofPUENTES entre el Comercio y el Desarrollo Sostenible©; and
PASSERELLES entre le commerce et le développement durable©; and
PONTES Entre o Comércio e o Desenvolvimento Sustentável©
Moving ideas, pursuing solutions