China - How Fast Could China Clean Up?

Not very

Given reports that China is making a major effort to switch to renewable energy that could account for 10 percent of power generation by 2015, how much can the country actually do about its disastrous levels of pollution, and how soon? The answer is probably not much, and it will take years if not decades.

As Asia Sentinel reported yesterday, Record smog is estimated to have caused thousands of premature deaths in four Chinese cities and led to severe illness for 100,000 people. On Jan. 12, hazardous particulates peaked at 993 per square meter in Beijing - nearly 40 times the hazardous limit proposed by the World Health Organization.

The sheer scale of the environmental disaster from air pollution this month has focused renewed attention on just how bad China's environmental disaster is. In 2007, according to the BBC, a draft report by the World Bank and China's State Environmental Protection Administration concluded that as many as 760,000 people die prematurely early each year because of air and water pollution. The report was withdrawn at the urging of Chinese officials. Other reports put estimates at lower figures, but that that unless outdoor pollution is curbed dramatically, 550,000 people will die prematurely annually. Major "cancer clusters" have been identified all over the country.

The magnitude of cleaning the air and water is so big that even a country that can throw a high-speed rail line hundreds of miles is going to take a long time to clean up, even if the will is there and the vested interests are willing to stand aside. It is reckoned that half a billion people lack safe and clean drinking water. Only 1 percent of the urban population breathe air considered safe by the European Union.

Until a few months ago, the Chinese approach to pollution control was to not mention it. Famously, in 2010 the US Embassy, which posts daily air quality reports, described the measurement as "crazy bad." The Chinese objected and the description was changed to "beyond index." The government has asked foreign consulates to stop publishing "inaccurate and unlawful" data despite the fact that official data the average figure for dangerous particulates was more than 300 - against a World Health Organization hazard level of 25.

It's questionable whether the RMB 500 billion (US$80 billion) projected in new spending on renewables by 2015 is actually directed toward cleaning the air, or more towards cutting down on expensive energy imports, and whether it can even meet its 10 percent goal by 2015.

In fact, while coal would fall as a fraction of the generating mix it will rise in absolute terms by about 50 percent compounded between 2010 and 2015. Even if that's all in cutting-edge ultra-critical power plants that's a still a lot more carbon and heavy metals into the air.

Even without that, the government faces a vast array of public and private entities with vested interests in keeping the smoke belching - not least the thousands of coal mines surreptitiously owned by local officials in defiance of Beijing's attempts to separate ownership from government. It is a country in which criminal evasion of food safety standards is endemic, an indication of how so many government and company officials simply disregard safety in pursuit of profit.

In addition it will take some time for the new top team in Beijing - President Xi Jinping and Prime Minister Li Keqiang - to show they have the power to act decisively. The two are not to take over formally until April. The current leadership of Hu Jintao and Wen Jiabao has been largely operating on autopilot for the past several years.

State-owned oil refineries and energy companies - the country's biggest companies - have defied efforts on the part of the central government to force them to upgrade their facilities. Although both Sinopec Group, and PetroChina say they have spent billions of dollars in upgrading refineries to comply with environmental laws, they have so far refused a central government edict to improve fuel quality itself.

"Pollution is bad in Chinese cities partly because the three state-owned oil firms refused the central government's request to improve the quality of fuel which will eat into their bottom line," said David Fullbrook, a sustainability analyst and regular contributor to Asia Sentinel. "If I recall rightly, better-quality fuel is only sold in a few places such as Shanghai. Whether that is the best quality possible I don't know, but maybe not. I don't know how fast refineries can be adapted to improve fuel quality but I'd be surprised if it's more than a few years, maybe could be done in a few months."

China is the world's biggest dam-builder, with hydropower plants with installed capacity of 249 gigawatts of power. Although it plans as many as 30 more dams, regulators have already become concerned about the environmental and social costs from moving hundreds of thousands of people out of the way of the catchment areas. The Three Gorges Dam on the Yangtze River, one of the world's biggest, has been criticized for a long list of disasters. Hydropower construction has slowed markedly since the 185-meter high dam was completed in 2005, with regulators unwilling to approve new plans amid concerns about environmental risks and massive relocation costs. Premier Wen himself called attention to the social and environmental costs of the Three Gorges Dam in a cabinet meeting last year.

Dams on the Nu River and Tiger Leaping Gorge in Yunnan Province, have been delayed or vetoed. Dams planned on the headwaters of the Mekong and the Brahmaputra Rivers have met with fierce resistance from environmentalists in the countries downstream.

There are also questions whether, as solar installations rise, particularly on private premises, the mostly state-owned power generators and two grid operators will see future revenue projections fall. As Asia Sentinel reported yesterday, the government envisions putting 42 gigawatts potential solar capacity on rooftops across Chinese cities, pointing to considerable market potential for retail installers, whose industry has been in crisis for months.

"I believe it's also still the case that quite a lot of wind is spinning idly waiting for a grid connection in a country that can build infrastructure at a quality and speed second to none (the infrastructure I've experienced in Yunnan is mind-blowing) when it wants too," Fullbrook said. "So the lack of grid connections is, I would suggest, at least partly a function of the political economy."

Moreover, the ultra-high voltage direct current transmission lines that make hydroelectric power on the eastern ramparts viable to feed the coastal load centers viable are exactly the same lines required to connect the wind-rich steppes of Qinghai, Gansu and Neimongol with the big cities of the plains and coasts.

"Potentially, therefore, China could do a lot more if the green or smart lobby in Zhongnanhai and the wider party can marshal more support," Fulbrook said. "This might be what is happening each time a target for wind or solar is announced and then revised upward sharply six months or a year later."

http://www.asiasentinel.com

Business & Investment Opportunities
Saigon Business Corporation Pte Ltd (SBC) is incorporated in Singapore since 1994. As Your Business Companion, we propose a range of services in Strategy, Investment and Management, focusing Health care and Life Science with expertise in ASEAN 's area. We are currently changing the platform of www.yourvietnamexpert.com, if any request, please, contact directly Dr Christian SIODMAK, business strategist, owner and CEO of SBC at christian.siodmak@gmail.com. Many thanks.