This page is dedicated to biweekly discussion.
Topic: Energy Policy
01.30.2011 - Sunday - Starts at 6:30pm - @143 Albany Street, Apt 014C - Lasts 75 min or more - Snack and water provided
Call 617-768-7966, 陈粹粹, when you need assistance upon arrival
1. Why?---Why do we care that much about energy/carbon? (15 min)
[Cuicui] ...Because of climate change. <IAP China slides-facts>
[Fei] ...Because of energy security. <correspondence with Fuxian, MIT natural gas study>
[Rong] ...Because of China’s desire to develop sustainably.
...
2. What?---What policies are we pursuing? What are the problems associated with these policies? (30 min)
[Cuicui] overall goals, policies <IAP China slides-policies>
[Rong] Energy efficiency enhancement and carbon reduction
[Cuicui] nuclear energy, wind energy, biofuel <correspondence with Yuan WANG, own research>
[Hongtao] biomass <own research>
...
Must-discuss:
pricing (oil, coal)
nuclear safety and security issues
implications of government subsidies
3. Who?---Who runs the energy reform machine? (20 min)
[Benyue] China’s development and limitations of energy bureaucracy <China’s new energy bureaucracy.pdf, China's ongoing energy efficiency drive-Origins, progress and Prospects.pdf>
...
Must-discuss:
gap/conflicts between local governments and the central government
gap/conflicts between state-owned companies and the central government
gap/conflicts between China and Rest of the World (ROW)
4. Energy/Climate Updates (10 min)
[Rong] 2nd US-China energy forum, Hu’s visit to U.S.
...
5. Free Discussion
Reading Materials
Cuicui (1/22): This article claims that China is and continue to be using energy inefficiently and emitting a lot of carbon dioxide, which has something to do with "Beijing Consensus", a framework in which the government subsidies and controls the energy market. This serves a lesson for US, i.e., US cannot follow China by investing heavily in and controlling the energy market, because that will actually harm the economy.
3 cases: how the US regulates the energy development
Cuicui (1/22): This article aims to improve public understanding of regulation. The author listed three cases to illustrate the fact that energy regulation has to balance interests of different groups, which is not easy.
China's Green Revolution Report
Cuicui (1/28): This is a report produced by McKinsey, which is famous for its McKinsey Cost Curve. Read from left to right, the McKinsey Curve lists carbon-reducing technologies from the cheapest ones (i.e., ones w/ negative costs, or low hanging fruits) to the most expensive ones (e.g., carbon capture and sequestration), with the Y-axes denoting the costs and X-axes denoting the abatement potential of each technology. Thus, the integration of the McKinsey Curve by X is the total cost of abatement if each technology is employed to its full potential. McKinsey did more or less the same thing in this particular report for China, drawing a McKinsey China Curve based on engineering approaches and deriving the total abatement cost and maximal carbon reduction possible.
Brookings US-China Strategic Forum on Clean Energy Cooperation
Cuicui (1/28): The Forum was held on Jan 18-19 at Washington D.C, and was at a level high enough to draw letters from Hu and Obama and convene high-rank energy officials in China and US.
郎咸平说（China-US Cooperation in Nuclear Power)
Cuicui (1/28): Lang contends that China is (willingly) spending larger-than-usual amount of money on U.S. third-generation nuclear technologies provided by Westinghouse, an US energy company with Japanese holding more than 50% of its shares, while offering fourth-generation nuclear technologies to U.S. at a low price.
China-US Clean Energy Cooperation from the a American reporter
Cuicui (1/28): The author claims that although China appears to be a gigantic energy producer and consumer, it does not follow that China is leading the energy market. Nor will China steal a significant amount of jobs from U.S. He also warns that U.S. should not imitate China by matching government subsidies to green industries, which will actually harm the economy. One peculiar point I found in this article is that Steven Chu holds that "China has experience and expertise with rapid, large-scale deployment of technologies. As the world's fastest and largest growing energy market, China can serve as an important global testing ground for new technologies", which I found sort of insulting.
China's ongoing energy efficiency drive-Origins, progress and Prospects.pdf
Benyue (1/24): The notes are incomplete for the article : Notes from Benyue.doc needs revision.
China's National Action on Climate Change.pdf
Cuicui (1/28): This is a 2007 report on China's national action toward climate change, which includes description of status quo, possible impacts of climate change on China, climate policies, effects, etc.
China's New Energy Bureaucracy.pdf
Cuicui (1/28): This article examines the development, imitations and futures of China's energy bureaucracy. Especially, the author concludes that state-owned energy companies have more say in energy issues than do government agencies.
Cuicui (1/28): This file presents some energy and climate facts about China, produced in September 2010.MIT Report on Natural Gas.pdf
Cuicui (1/28): This is a report produced by MIT Energy Initiative on Natural Gas, which claims that natural gas may serve as a good interim energy source on our transition from an oil-fueled world to a renewables-fueled world.
IAP's Climate 102 slides by Joint Program
Cuicui (1/28): These slides present energy/climate facts and policies in China, India, US, EU, Mexico and Canada, used in the IAP course: Climate 102.
Annual Report on Climate Change by NDRC.pdf
Cuicui (1/28): This is a 2010 report on China's national action toward climate change, which includes description of status quo, possible impacts of climate change on China, climate policies, effects, etc.
Correspondence
1. Energy Security
1/12 Fuxian Song:
How China is going to balance the tradeoff between CO2 reduction and national energy security in the near term and in the long term? In the near term, one possible solution to lessen the foreign oil dependence while reducing CO2 emission will be develop alternative fuels, among many choices, natural gas seems to be a feasible solution at scale. However, lacking of domestic NG production, NG also faces security issue while depending on LNG and Russia/Central Asia imports. What are the possible cards that China can play?
1/16 Cuicui Chen replied:
t has always been perplexing to me why more use of fossil fuels means more energy security. I would advocate for scientific management of strategic petroleum reserves (to supply sufficient oil when renewables go wrong), more use of renewable energy (to reduce oil dependence), and more R&D on electricity storage, in order to increase energy security.
1/16 Fuxian Song replied:
It's the scale and infrastructure of the energy supply that answers why solely depending on renewables won't solve the tradeoff between energy security and CO2 emission in the near term. In energy arena, everything has a big momentum and tends to take a while. I would suggest you take a look at the MIT natural gas study.
2. Miscellaneous Q&A
1/16 Q by David Cohen-Tanugi and A by Cuicui Chen:
Q: What's so useful about China's energy/carbon intensity targets if China is primarily shifting its polluting industries to other countries? Then the CO2 will simply come from Vietnam instead, and the world won't be any better off.
A: That is exactly the case for US --- US has leaked a lot of CO2, and is continuing leaking CO2, to developing countries, especially to China. Before criticizing China for carbon leak, people should not ignore what US has done. What's worse, US still has four times as huge carbon emissions per capita as China even without counting leaked carbon. I would advocate for a consumption-based CO2 accounting, on which climate targets are based.
Q: Why should the U.S. encourage the deployment of renewable energy, when Chinese renewable manufacturers benefit from free land, tax credits, subsidized electricity and other subsidies from the Chinese government? How are U.S. renewables deployment efforts supposed to benefit domestic clean energy capacity unless border tariffs are enforced?
A: Whether a border tax does more good or harm to US itself is not obvious. On one hand, cheap imports, without tariff, from China may drive out more expensive domestic goods on the market. On the other hand, cheap imports, without tariff, may reduce the cost of production for industries using Chinese imports as intermediate inputs. It is entirely possible that the net effect of border tax on US is negative.
Q: China's newest carbon intensity target is on par with the Reference Scenario of the U.S. Energy Information Administration. Isn't China's target merely business-as-usual?
A: I would be interested to look at the original report including reference scenario of US EIA. Business-as-usual scenario is one without climate policy. If there were no climate policy, how would carbon intensity drop by as much as 40-45%? What would the driving factors be?
Q: It's hard to argue that China is still a developing country when its per-capita CO2 emission levels will have surpassed Europe by 2015 or so.
A: Although there is no unanimous agreement on what criteria should be used to categorize developing and developed countries, per-capita CO2 emissions are not so widely used as GDP per capita, industrialization, Human Development Index (HDI), etc. I would argue that per-capita CO2 emissions are no more than a complementary sub-criterion to those widely used criteria. China is still 93th (IMF, 2010), 83th (WB, 2009) and 101th (CIA, 2010) in terms of GDP per capita.
Q: You might also look into the criticisms from Derek Scissors from the Heritage Foundation, e.g. about the unreliability of Chinese official statistics.
A: Data are always a problem. China is still a developing country with capacity limited, unlike U.S. which can produce almost complete and almost correct data. The fact is, if you are to blame a country, or an economic paper, or an IPCC report, data are always a perfect sink for criticism. People may have to live with it, unless huge funds and technology are available to increase China's capacity to produce almost complete and almost correct data.
Records
Forthcoming
Chair: Cuicui Chen
External Relations: Rong Yuan
Logistics: Fei Gao
Record: Benyue Liu
Attendees: Feng Fu, Hongtao Liu, Ning Wu, Yiqing Xu