China may be close to a climate tipping point
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Pilita Clark is an FT business columnist
If you want to be hopeful about the world’s chances of tackling climate change, look to China.
It is such a force in the electric car market that, last year, for the first time, it became home to more than half the electric vehicles on the world’s roads.
An equally impressive surge in solar and wind power means that China, alone, now has more big solar farm generating capacity than the rest of the world put together.
And forecasts suggest that the country is poised to smash its clean energy targets five years early.
If you want to feel despair about the world’s hopes of addressing climate change though, also look to China.
The country has been on a coal power permit binge, approving the equivalent of two new coal power plants a week last year — the highest level since 2015.
And its hunger for fossil fuels makes China by far the world’s biggest carbon dioxide polluter, pumping out nearly a third of annual emissions, or more than the US, the EU, and Africa combined.
In other words, no country holds the fate of the planet’s climate in its hands like China. This is both deeply unsettling and — from Beijing’s perspective — deeply unfair. Gargantuan as its annual emissions now are, China has, over time, produced far fewer greenhouse gases than the US, the biggest historic emitter. Even now, the average American still produces a lot more emissions than the average Chinese person.
Still, if China doesn’t cut its pollution faster, it will make it much harder to meet the Paris Agreement goal to limit global warming to 1.5C over pre-industrial levels.
The world has already warmed by at least 1.1C and staving off 1.5C requires global emissions to nearly halve by 2030 and reach net zero by about 2050.
But China plans to have its emissions peak by 2030 and to reach carbon neutrality by 2060.
“It’s just a matter of pure mathematics that if China’s emissions keep going up until 2030, those Paris goals go out the window,” says Lauri Myllyvirta, a China energy analyst at the Centre for Research on Energy and Clean Air in Helsinki.
So is there any hope that China might move faster?
Myllyvirta turned heads in November with analysis showing that China’s green energy spree means its carbon emissions are set to fall in 2024 and could even go into structural decline.
That decline is not guaranteed, though. China is not immune from the domestic political tensions that divide influential fossil fuel groups from green energy advocates in western countries.
Today, however, the country faces a rising set of competitive pressures that it has not had to reckon with before.
It became a global green juggernaut thanks to a sustained industrial policy that has given it an iron grip on clean energy supply chains, including the minerals needed for the technologies of the future.
It has, for instance, most of the processing and refining capacity for key clean energy materials such as lithium, cobalt and graphite. It produces three-quarters of the world’s lithium-ion batteries. But one of the aims of the US Inflation Reduction Act (IRA), the biggest climate law in US history, is to build up American green supply chains. At the same time, across the Atlantic, the EU has responded to the IRA with its own efforts to boost net zero industries.
This article is part of an FT special report on Managing Climate Change
Some China-watchers think this intensifying competition will encourage Beijing to keep up its clean energy boom, or perhaps expand it further. It certainly seems unlikely to slow down its efforts if its rivals speed up theirs.
None of this means a new green trade landscape will evolve smoothly.
In October, the EU launched an anti-subsidy investigation into China’s electric car industry. This was amid fears that cheaper Chinese imports will hit Europe’s carmakers in the way they struck the bloc’s solar panel industry more than a decade ago.
That has led to charges from China of green hypocrisy, says Bernice Lee, a climate expert at the Chatham House think-tank in London. “I am hearing Chinese stakeholders say of the EU: ‘You tell us you care about climate, but you would rather start from scratch building up your own electric car supply chains than buy cheap stuff from us that’s available now. Who is being hypocritical here?’”, she says.
Then, there is the EU’s groundbreaking carbon border tax: a levy on carbon-intensive imports such as cement, that is designed to stop EU companies moving to countries with weaker climate policies, and spur cleaner industry abroad. That has raised concern in both China, with its rising emissions, and the US, where emissions are falling but some object to having to pay EU carbon taxes.
One solution proposed this year by Paul Bledsoe, a former White House official under President Bill Clinton, and Ed Gresser, an ex-trade official, would give EU companies access to the IRA’s green benefits, if Brussels rethought its carbon border tax. A big benefit of the plan, say its proposers, would be the “strong incentives” for big emitters such as China to cut their emissions.
That idea is unlikely to fly and China may resist any measures that do. But Beijing’s soaring green industrial might — coupled with rising pressure from competitors — is raising hopes of a turning point in the world’s biggest emitter that few had dared imagine, until now.
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