China
, Arab nations agree to establish energy
cooperative mechanism
June 24 (Xinhua) –
BEIJING
-
China
and 22 Arab nations agreed to establish a cooperative mechanism on energy
resources, according to an outcome document approved by the sixth senior
officials' meeting of the China-Arab Cooperation Forum here Wednesday.
The document said the two sides
agreed that cooperative mechanisms for energy resources, including renewables
such as solar and wind, should be established among the governments,
state-owned and private enterprises.
The two sides also agreed that
both had the right to use nuclear energy peacefully and that investment in oil
and natural gas exploration, refining, transportation and sale should be
encouraged.
Both sides praised the
achievements in building a new type of Sino-Arab partnership, and they pledged
to enhance cooperation in investment, trade and environmental protection and to
actively strengthen cultural, artistic and educational exchanges.
The participants agreed to hold
the fourth ministerial conference of the Sino-Arab Cooperation Forum in
China
in the second quarter of 2010 and the 7th senior officials' meeting before the
ministerial conference.
(http://news.xinhuanet.com/english/2009-06/24/content_11595260.htm )
June 2 (China Daily) -
China
should
try to free itself of excessive dependence on the world energy market and set
up a self-reliant energy structure for the sustainable development of its
growing economy.
The country's dependence on
energy imports has been rising in recent years. According to statistics
released by the General Administration of Customs, last year, the net crude oil
imported by the world's third largest economy was 175 million tons against 189
million tons produced at home. That means for 50 percent of its crude oil
demand,
China
is dependent on foreign markets. This poses a serious challenge to the
country's energy security and its sustainable development.
Robert Priddle, former chief of
the International Energy Agency, is of the view that
China
, as a country in transition,
is yet to resolve a raft of pressing energy issues, given that its energy
structure is changing from one of self-reliance to a growing dependence on
imports.
China
's economic growth has relied on exhaustive
consumption of its limited energy resources. Since energy prices are soaring
and energy shortage is increasing worldwide,
China
should stick to the
conservation principle: depend more on domestic energy, such as its enormous
coal reserves.
The country should first take
every possible measure to curb the unrestrained development of some of the
energy-guzzling and high-pollution sectors; and put in place a variety of State
policies designed to limit exports of such products. To this end, a set of
electricity pricing standards should be implemented that differentiate
high-energy and high-pollution sectors from more efficient enterprises. Also,
there should be a thorough overhaul of domestic enterprises, high-energy and
high-pollution ones in particular, to encourage them to introduce superior
equipment and production techniques for cost reduction and elimination of
outdated processes.
Besides, more effort should be
made to strengthen awareness of economical energy utilization and motivate
low-standard enterprises to increase technological inputs for conservation and
emission reduction. The prevailing lower international oil prices should not be
used to stimulate domestic oil consumption as a means to expedite economic
recovery and development.
As one of the world's largest
energy consumers,
China
should make unremitting efforts to set up a diversified energy structure and
increase supplies. The country should improve its oil, gas and hydropower
output levels, and step up development of nuclear power technology. There
should be breakthroughs in the development of wind and solar power and
bio-energy technologies to popularize their application on a meaningful scale.
Economics theory tells that, as a developing country,
China
is
unlikely to leap over the energy-intensive industrialized stage.
However,
China
should
try to avoid the old high-energy and high-pollution development model once
taken by most of the world's industrialized nations. It should choose to move
forward on a new path. That demands
China
should acquire a new
perspective on its industrial structural adjustment and strengthen its energy
supplying capability. Also, a multiple energy development pattern is needed,
with coal, oil and natural gas playing a major role while hydropower, wind
power and bio-energy, solar and nuclear power play an auxiliary part.
It is known that
China
is a
coal-abundant nation and the country's enormous coal reserves could meet its
long-term demands. However, the proportion of
China
's coal consumption to its
total energy consumption decreased to 68.9 percent in 2006 from 96.7 percent in
1952. Such a coal-dependent energy structure is not expected to change
fundamentally within a short period.
To meet the demands for its
economic growth and for environmental protection,
China
should capitalize on its
advantage in coal reserves through improvements in coal production and
processing technology. In doing so, the ultimate purpose is more effective
energy utilization, reduced environmental pollution, and improved capability
for self-reliance.
At the same time,
China
should
learn from the experience of other countries of ways to set up and improve its
fledgling energy security system. To this end, the country should improve its
energy laws and regulations, create a system of energy information, and frame
an early security warning and emergency mechanism. Besides, an open dialogue
platform should be set up among producers and consumers to expand the energy
supply network and promote globalization of production, transportation,
purchase, transaction and utilization.
While introducing advanced energy
technologies from abroad,
China
should also make an effort to promote their assimilation and innovation at
home.
The authors are professors with
Nanjing
University
. Shanghai Forum contributed
to the article.
(http://www.chinadaily.com.cn/cndy/2009-06/02/content_7961229.htm )
China
eyes 20% renewable energy by 2020
June 10 (Agencies) –
BEIJING-
China
plans to dramatically increase its use of wind and solar power, aiming to
generate up to one fifth of its energy from renewable sources by 2020, a senior
official told
Britain
's
Guardian newspaper.
"We are now formulating a
plan for development of renewable energy," Zhang Xiaoqiang, vice-chairman
of
China
's National
Development and Reform Commission, said in an interview in
London
published Wednesday.
"We can be sure we will
exceed the 15 percent target. We will at least reach 18 percent. Personally I
think we could reach the target of having renewables provide 20 percent of
total energy consumption."
China
's stated goal is for 15 percent
of its energy consumption in 2020 to come from renewable sources, which
Beijing
says include
large hydropower projects and nuclear plants.
The Guardian reported Zhang as
saying that a significant part of
China
's economic stimulus package
would be invested into low-carbon investment, and that accompanying reforms
would see increased demand for renewable energy.
"Due to the impact of the
global financial crisis, people are all talking about green and sustainable
development," Zhang told the paper.
"Enterprises and government
at all levels are showing more enthusiasm for the development of solar for
power generation, and the Chinese government is now considering rolling out
more stimulus policies for the development of solar power."
US
climate envoy Todd Stern met
with top Chinese officials in
Beijing
this week
to press for a commitment to cutting greenhouse gas emissions under the next
treaty on global warming, to be hammered out in
Copenhagen
in December.
In a meeting on Monday, Vice
Premier Li Keqiang reiterated to Stern that developing countries like
China
should be
held to a different standard, according to a statement posted on the Chinese
foreign ministry's website.
Zhang said
China
was pursuing a "constructive and a
positive role" in negotiations for
Copenhagen
,
and as part of the agreement, developing countries would have to pursue a
"sustainable development path."
He added that
China
was open
to the idea of limits on the carbon intensity of its economy, or setting
restrictions on its emissions per unit of output.
(http://www.chinadaily.com.cn/china/2009-06/10/content_8268871.htm )
China
commits to offshore renewable energy
June 24 (China Daily) -- China is
planning to construct a number of 10 GW wind power bases in the coming years,
in a bid to further boost the development of the country's renewable energy
industry, the country's top energy official said recently.
Zhang Guobao, administrator of the National Energy Administration, said:
"We have worked out the strategy of building large (wind power) bases and
integrating them into the mainstream power grid in order to speed up the pace
of wind power development in the country".
Vigorously developing renewable energy, including wind power, forms part
of the country's ongoing strategy to contribute to the global campaign for
combating climate change.
Currently, the world's installed capacity of wind power has reached 120
GW, and wind power has become an essential part of the world's energy
structure, said Zhang, who is also a minister-level vice-chairman of the
National Development and Reform Commission.
Although a developing country,
China
places special emphasis on
increasing its use of renewable energy such as wind power. By the end of 2008,
the country's installed capacity of wind power had hit over 10 GW. The Chinese
government also released the Renewable Energy Law in 2005 to provide strong
legal support to the development of renewable energy in the country.
As part of the estimation in Medium and Long-Term Development Plan for
Renewable Energy in
China
,
issued by National Development and Reform Commission in September 2007, the
total exploitable potential wind power resources in the country could reach over
1,000 GW, of which onshore wind power resources would provide about 300 GW with
offshore wind power resources around 700GW.
To better use wind power resources, Zhang has called for strong efforts
to be made to develop offshore wind power resources as offshore wind energy
offers higher wind speeds, no occupancy of land resources and smaller impact on
the environment.
To date, the EU has already made great efforts to develop offshore wind
power and considers it the main priority in the wind energy area.
"
China
has very long coastlines and vast oceanic areas, providing very good conditions
for offshore wind power development", he noted.
The economically well-developed eastern areas of the country suffer from
a shortage of fossil fuels, but enjoy sufficient offshore wind power resources.
"It is particularly important to develop offshore wind resources to power
the economic growth in these areas," he added.
Shi Lishan, deputy director general of the New and Renewable Energy
Department of the National Energy Administration, as well as program director
of China Renewable Energy Scale-up Program, said that compared with onshore
wind power, offshore wind power generation entails more complicated working
conditions, tougher technical requirements and greater difficulties in
installation.
All these bring new challenges to turbine manufacturing, project
construction, operation and management.
In addition, more attention must be paid to offshore wind power project
planning in order to maintain a harmonious relationship with other sectors such
as harbors, navigation channels and offshore breeding facilities, and to ensure
protection of the environment.
Shi therefore considers it important to draft regulations on offshore
wind farm location and environmental impact.
The construction of the Shanghai East Sea Bridge Wind Power Plant has
marked a good start for development of the country's offshore wind power
generation.
The first set of 34 wind power turbines for the country's first offshore
wind power farm began the construction in March this year. The 2.3 billion yuan
($336.56 million) project is expected to generate 267 GWh of electricity
annually, and will supply clean power to the 2010 World Expo in
Shanghai
.
(http://www.chinadaily.com.cn/bizchina/2009-06/24/content_8316184.htm )
China
Shenhua eyes parent's coal
conversion mill
June 24 (Reuters) - SHANGHAI,
June 25 (Reuters) - China Shenhua Energy Co Ltd will consider buying its state-owned parent's coal-to-liquid plant, the
China Securities Journal reported on Thursday, citing the company's board
secretary.
"Once the project's prospect
is certain, the listed company will take it over and boost the facility to 5
million tonnes that the government approved," Huang Qing was quoted as
saying at an investment conference.
Its parent company, Shenhua
Group,
China
's
largest coal producer, will begin a 1,000-hour project trial in July to collect
operation data, Huang said.
The coal-to-liquid plant, located
in
Inner Mongolia
, went through a successful
trial run earlier this year, producing naphtha and diesel, among other
products.
China
last year suspended all but two coal-to-oil
projects because of high investment risk.
China
, the world's largest coal producer and
consumer, a few years ago began encouraging coal-to-oil projects to help ease
its dependence on imported crude oil.
Shenhua Group plans to invest
more than 400 billion yuan over the next decade in facilities to convert coal
to oil, methanol and gas, the official Xinhua news agency has reported.
The group's target is for
capacity to convert 100 million tonnes of coal into about 30 million tonnes of
oil and chemical products by 2020, Xinhua said.
(http://www.reuters.com/article/rbssEnergyNews/idUSSHA23755220090625 )
China
's first bioenergy research center inaugurated in
Nanning
June 14 (Xinhua) -
NANNING
-
China
's first
bioenergy research center was inaugurated Sunday in
Nanning
, the capital city of southern Guangxi
Zhuang Autonomous Region, amid government's plans of new energy development to
combat global energy crisis.
The research center is set up
based on the national guidance on energy and grain security, and will look to
cassava, sugar cane, sweet sorghum as the main sources for new energy
development.
Bioenergy has good prospects in
tackling energy crisis and protecting grain security and ecological environment
since it has low emission and in contest with human beings for resources, said
Huang Ribo, director of the research center.
China
has abundant bioenergy resources, which is
expected to total five billion tonnes. The tropical Guangxi has rich reserve of
cassava, sugar cane, which takes up more than 65 percent of the nation's total,
he said.
China
's first cassava-for-alcohol fuel
project, which has an annual capacity of 200,000 tonnes, was started in Beihai
city of
Guangxi
in 2007.
The Guangxi Academy of Sciences
will support the research center with research talents and facilities.
According to a report released by
the
Chinese
Academy
of Sciences on June 10, bioenergy is expected to realize commercial production
on a massive scale in
China
and replace 30 percent of the oil imports by 2050.
(http://news.xinhuanet.com/english/2009-06/14/content_11541989.htm )
June 17 (China Daily) – SHANGHAI - Despite the hype given to solar
energy development, Shanghai Electric Group, China's largest power generating
equipment maker, has remained steadfast in getting out of the sector, which it
deems as unprofitable, at least in the short-term.
The sale of its 35 percent stake in solar energy equipment maker
Shanghai Topsolar Green Energy for 138.6 million yuan fell through last week
because the buyer was said to have defaulted on payment. Fu Rong, Shanghai
Electric's board secretary, said in a written reply that her company hasn't
made a firm decision on what to do next with the unsold stake in Shanghai
Topsolar.
But she had said earlier that the disposal of the company's investment
in solar energy was essential because the company couldn't find a way to
incorporate it into its future development plans. She was echoing the lines of
Shanghai Electric's chairman Xu Jianguo, who said that he couldn't see a
profitable future for solar energy despite official efforts to promote the
sector as an alternative energy source to supplement fossil fuel.
"Shanghai Electric's determination to spin off the solar energy
business is not in doubt, given the sector's minor contribution to the
company's earnings, "said Zhan Wenhui, analyst with Haitong Securities in
Shanghai
.
Zhan said around 70 percent of Shanghai Electric's sales is generated
from manufacture of fire-power equipment. As sales began to decline in recent
years, the company has embarked on an ambitious plan to develop its capability
in the production of nuclear and wind-powered energy generating equipment.
After reaching its peak in 2004, the profitability of Shanghai
Electric's mainstay business of fire-powered generating equipment has been
falling steadily. The rate of return on sales of such equipment in the second
half of 2008 fell to 17 percent from more than 20 percent a year back, although
the company continued to hold a 30 percent market share.
To raise capital for new ventures, Shanghai Electric in April raised 5
billion yuan by issuing about 700 million new shares at 7.15 yuan apiece. The
company said 1.1 billion yuan of the total fund raised would be invested into
nuclear projects, while 800 million yuan would go to wind power.
The company's A-shares dropped 0.48 percent to close at 10.4 yuan
yesterday.
"Our target is to produce 800 to 1,000 mega-watt wind turbines by
2010, and have sales of 10 billion yuan from the wind sector by 2011," Xu
told reporters earlier this year.
Xu said wind equipment would be the second sector to clock over 10
billion yuan sales on the heels of fire-power equipment going forward, due to
the recent strategies to develop new energy.
Huang Li, deputy director-general in charge of energy saving and
technology equipment under National Energy Administration, said last November
China would subsidize 800 million yuan to core nuclear and wind power equipment
makers, a move expected to benefit nearly 10 percent of the companies in the
sector, according to Xinhua News Agency reports.
Shanghai Electric started developing wind power since 2004 with the
capacity to do volume production of 1.25 mW and 2 mW wind turbines so far.
The company said nuclear and wind power will take the place of
fire-power to lead the electric power generating over time.
Shanghai Electric has so far taken on nuclear-related orders worth 18.3
billion yuan so far, with almost 50 percent market share in making the main
equipment of nuclear island domestically.
Xu said the company's sales from the nuclear business are likely to grow
by 75 percent year-on-year to touch 3.5 billion yuan in 2009. Around 12 new
nuclear projects are in the pipeline currently, with installed capacity of
around 23.7 million kW.
However, Goldman Sachs said in a recent research note that the power
equipment industry still has downside risks due to concerns on growth slowdown
in power generation capacity partly due to the limited number of new power
plants approved by the government.
Shanghai Electric gained 2.5 billion yuan in net profit in 2008, down
9.88 percent year-on-year.
(http://www.chinadaily.com.cn/cndy/2009-06/17/content_8291454.htm )
China
sets standards for “new energy” vehicles
June 29 (Canada Carline) -
Beijing
,
China
-
China
has classified “new energy”
vehicles into three categories and has set a target of at least 5 per cent of
alternative-energy automobiles by 2011, according to a report by the Green Car Congress.
The
three categories include start-up technology still at the research level, such
as fuel cell vehicles; developing technologies, including hybrid engines with
lithium ion batteries; and mature technologies with standardized mass
production, such as lead acid battery hybrid vehicles. The categories were
determined by
China
’s
Ministry of Industry and Information Technology.
According
to the classifications, vehicles powered by mature alternative energy
technologies will now be treated as conventional vehicles, including hybrid
passenger vehicles with nickel-metal hydride or lead-acid batteries, and
electric vehicles with lead-acid batteries. Automakers are allowed to begin
mass production of vehicles with developing energy technologies, but
their sales are still subject to certain conditions.
The
new standards will be in effect until the end of 2010, when they will be
revised further.
Earlier
this year, China’s State Council set a sales target for
alternative-energy automobiles of at least 5 per cent of total passenger
vehicle sales by 2011, with each major domestic automaker offering at least one
such model. The government’s total vehicle sales target is 10 million units in
2009, with annual growth averaging 10 per cent over the next 3 years.
(http://www.canadiandriver.com/2009/06/29/china-sets-standards-for-new-energy-vehicles.htm )
June 1 (China Daily, Reuters) -- A ceremony
took place in the Bulgarian city of Lovech on May 11 to mark the opening of a
joint venture auto plant run by China's Great Wall Motor Company and Bulgaria's
Litex Motors producing environmentally friendly vehicles.
Bulgarian media reported that the plant has
an initial investment of 80 million euros and is expected to produce Great
Wall's Florid cars and Hover SUVs. According to Sofia News Agency, this project
will initially create 1,000 new jobs.
The growing popularity of environmentally
friendly and cheap cars in the world offers excellent opportunities, and Great
Wall is among the first Chinese firms to tap into this potential in an overseas
market.
China
hopes to see 60,000
energy-saving and new energy vehicles on its roads by 2012, among which various
kinds of hybrids will account for over 95 percent, said Wan Gang, minister of
science and technology.
So far, 10 kinds of new energy vehicles have
been granted production licenses, and a batch of new energy vehicles including
zero-emission electric vehicles will appear on the market.
Wan said that the Ministry of Science and
Technology, together with the Ministry of Finance, the National Development and
Reform Commission and the Ministry of Industry and Information Technology, has
launched a national energy-saving, new energy vehicle demonstration project.
The project's 13 pilot cities will promote
the use of new energy vehicles, mainly hybrids, for public transport, taxis,
official business, municipal administration, postal services and other forms of
public transport. In some big cities, the ministry will promote electric and
fuel cell vehicles.
As the Chairman of the State-owned Assets
Supervision and Administration Commission of the State Council (SASAC)
Supervision Board Ji Xiaonan pointed out, judging from the development plan of
the world's major automobile manufacturers, the new energy vehicle era will
arrive earlier than expected.
Low-emission hybrid electric vehicles have
already entered the phase of large-scale industrialization. Over one million
hybrid vehicles have already been sold globally, while the mass production of
zero-emission vehicles will be realized in 2015, a decade earlier than
originally expected.
Ouyang Minggao, expert leader of the Energy
Saving and new energy auto project of the National Hi-tech R&D Program (863
Program) predicted that
China
would develop hybrid, electric and fuel cell vehicles.
According to the Shanghai Securities News,
China
will offer 43,000 yuan in subsidies to
hybrid car buyers in the southwestern city of
Chongqing
, the first such initiative for
private cars.
The subsidy, from the local government, will
be given for the Jiexun brand hybrid sedan made by
Chongqing
Changan Automobile Co, People's
Daily Online said.
According to Reuters calculations, the
subsidy, including the waiving of 7,000 yuan in road fees for three years, is
equivalent to a 31 percent discount for the hybrid sedan.
The hybrid Jiexun, priced at 140,000 yuan,
has already received some orders and will hit the market as early as June, the
newspaper said, citing Ren Yong, deputy chief of Changan's clean energy auto
subsidiary unit.
China
pledged in February to subsidize
purchases of clean-energy vehicles for public fleets in 13 cities as it moves
to help its auto industry develop green technologies.
Under the trial scheme public transport
operators, taxi firms and postal and sanitary services in cities such as
Beijing
and
Shanghai
,
will get rebates of 28,000 yuan to 250,000 yuan for green vehicles, including
electric, hybrid and fuel-cell vehicles.
Late last year, the
Chongqing
government ordered 10 Jiexuns from
Changan and set a target to increase the number of hybrid vehicles in the
city's public sector to
1,000 in
three years.
(http://www.chinadaily.com.cn/world/2009green/2009-06/01/content_8093401.htm )
June
1 (China Daily) -- SAN FRANCISCO: Contributing to the debut of various Chinese
alternative energy vehicles in the 2008 Beijing Olympics green car fleet, the
Volkswagen Group collaborated with Shanghai Auto and scientists at Tongji
University to design the Shanghai Volkswagen Passat Lingyu, a zero-emission
hydrogen fuel cell vehicle.
This
February, 16 of these alternative energy vehicles, equipped with the capacity
to travel at speeds of up to
145 km
per hour and as far as
235 km
on one tank of hydrogen fuel, went on display at California Fuel Cell
Partnership in
Sacramento
.
"The
cars run very well," John Tillman, Program Manager for the US Advanced
Powertrain Research Program at VW, said.
Currently
the partnership is displaying the cars, bringing the total number of exhibited
VW fuel cell vehicles to 24, and is taking them on test runs in order to
conduct performance evaluations. Ten Chinese technicians will be stationed at
the partnership for the next nine months to help maintain them. Together, these
vehicles comprise the largest fleet of fuel cell cars from one manufacturer.
Unlike
some alternative energy vehicles such as electric cars, these vehicles do not
need to be recharged, meaning they can drive for longer distances without
stopping.
One
of the vehicle's key environmental attractions is that its only by-product
emissions are water and oxygen. Its peak energy of 55 kilowatts, obtained by
converting hydrogen into water, is fed into a 376-volt lithium-ion battery pack
located in the backseat. The fuel cell is charged in part by regenerative
braking, a system allowing energy to flow back into the battery when the
vehicle has braked.
Still,
Tillman cannot predict when the vehicles will be on the market nor how much
they will cost - a factor that will fluctuate widely depending on the country
in which they are manufactured. The lifespan of the vehicles has also yet to be
determined.
Will
the Passat Lingyu and other hydrogen vehicles be economically viable in the
United States
?
Tillman feels that the answer is a "chicken-and-egg situation". No
one will want to build costly fuel stations until hydrogen fuel is widely
commercially available, he said, yet its availability depends on having the
infrastructure needed to market and distribute the fuel widely in the first
place. There are currently 24 hydrogen fuel stations in
California
, yet a limited number are open
for public use. In addition, only 25 to 30 hydrogen fuel cell cars, all Hondas,
have been commercially released worldwide through lease deals.
Tillman
predicted that there is a larger market in
China
than the
US
for the vehicles, pointing to strong links between government and the private
sector - the formula he finds ideal to begin developing the economic conditions
for their production.
The
Passat Lingyu can also win mass appeal in
China
, he said, thanks to its
sustainability factor.
China
has set some of the world's strictest environmental standards in
the past few years. In 2003,
Beijing
set some of the world's strictest energy standards. Additionally, the country
as a whole set a goal of reducing its energy consumption by 20 percent between
2005 and 2010, according to the China Sustainable Energy Program, which is
headquartered in both
San Francisco
and
Beijing
.
The
20 hydrogen fuel cell vehicles used at last year's Olympics, including the 16
Passat Lingyus, were among a total of 500 alternative energy vehicles there.
Spectators were also able to travel to events in new biodiesel buses.
Zero-emission
vehicles could have a strong future in
China
as "pollution limits
China
's
growth", said Lisa Margonelli, a New American Foundation Fellow who has
written widely about alternative energy in
China
. In one article, she pointed
out that pollution-related illness could cost up to 15 percent of the country's
gross domestic product.
These
are the health and environmental concerns that could establish
China
as a strong market for hydrogen cars, she said. Its citizens will continue to
acquire the wealth to purchase a vehicle in the first place, but will not wish
to see the pollution resulting from the average petroleum car.
"People
want cars, but they don't want pollution," said Margonelli, adding that
"the virtue of hydrogen cars" is that they lack tailpipe emissions.
As
the
US
currently has 1.07 cars per driver, she pointed out that purchasing a vehicle
will likely begin to appeal to the 88 percent of the world that doesn't own
one.
"There's
a huge market for hydrogen vehicles" in both the
US
and
China
,
said Dan Sperling, the director of the Institute for Transportation Studies at
the
University
of
California
,
Still,
he said, "it will take a long time to achieve an economy of the
vehicles."
(http://www.chinadaily.com.cn/bw/2009-06/01/content_7957548.htm )
China
's car companies 'must learn' GM lesson
June 29 (China Daily) -- "General
Motors will go bankrupt in the next 10 to 20 years and the
US
market will become a desert for
the automotive industry." This unlikely prediction was made by Li Shufu,
chairman of Geely Automobile Holdings, back in 2001 during a heated automotive
forum in
Beijing
.
At the time, Li's words infuriated
representatives of both GM and Ford, a number of whom stormed out of the
meeting in protest. Just how seriously Li, himself, took his off-the-wall
prediction at the time will, perhaps, never be known, however, its accuracy,
eight years later, is now beyond dispute.
On June 1, the humiliated
US
automaker finally filed for Chapter 11
bankruptcy protection to the
US
government. This historic move made it the largest ever
US
industrial company to file for bankruptcy and
the fourth largest US company overall to make such a move - behind only
Worldcom
,
Washington
Mutual and Lehman Brothers.
The company's fall from grace is made all
the more spectacular by looking back at its years of almost unparalleled
success in the automotive sector. The company was the global sales leader in the
sector in for the 77 years from 1931 to 2007.
General Motors manufactured cars and trucks
in 34 countries, employed 244,500 people around the world, as well as selling
and servicing vehicles in some 140 countries.
Latterly, though, the collapse of the ever-biggest
automaker had become to seem inevitable. Zhang Xin, an auto industry analyst
with Guotai Jun'an Securities Co in
Beijing
,
represents the views of many: "Even if there was no financial crisis, GM
would still have folded. It had simply amassed too many problems during its
long history.
"By the time the company woke up to the
reality of the problems it was facing, it was far too late for them to be
addressed. The successes and failures of GM, however, should be an object
lesson for many in
China
's
domestic automotive industry, especially for those in the independent
sector."
Irrational
expansion
Zeng Zhiling, a senior analyst with Global
Insight Inc in
Shanghai
,
blames an irrational and unfettered impulse to expand and acquire as the source
of many of GM's woes: "GM's voracious appetite for acquisitions and
mergers and its investment in new brands made the company a hugely bloated
business, but, whilst it looked big, it was actually far from strong."
During the course of 2008, GM sold 8.35
million cars and trucks globally under its 12 brands of Buick, Cadillac,
Chevrolet, GMC, GM Daewoo, Opel, Vauxhall, Holden, Pontiac, Saab, Saturn and
Hummer. However, its core assets focused on only four brands - Buick, Cadillac,
Chevrolet, GMC. It is these four key assets that it has sought to maintain in
its bankruptcy protection filing.
Although it has now reached agreements to
sell Saab, Opel and Hummer separately, the prices of the deals has nosedived.
The subsequent shortfall in profits, then, is the inevitable outcome of the
company's irrational acquisition policy.
Zeng says: "Chinese automakers, with
just a decade of trading under their belts, should learn from this and focus on
strengthening their own capabilities and optimizing their production
structures, rather than rushing into expansion through ill-thought-out
acquisitions, especially those involving overseas companies."
A case in point is the recent move by the
Sichuan Tengzhong Heavy Industrial Machinery Co Ltd, a small-scale industrial
company with no experience in the automotive industry, who have put in a bid to
acquire GM's premium off-road brand, Hummer. The proposed deal has already been
dogged by speculation that it will be vetoed on environmental grounds and
because the purchaser lacks the experience to manage the
US
-based business.
Commenting in the likely collapse of the
deal, Zeng said "Domestic automakers should be very cautious when it comes
to mergers and acquisitions. The two sides need to have similar corporate
cultures and the same long-term development priorities."
Zhang Zhiyong, the chief auto analyst with
SDR Consulting Group, is even more scathing when it come to the current
advisability of acquisitions: "The multi-brand strategy makes it easy to
confuse a company's overall brand positioning. It also reduces management
efficiency as senior staff are obliged to divide their attention, time, and
resources across a number of different brands.
"Currently local automakers are tempted
by the multi-brands strategy as way to access more market segment. I hope that
many of them will learn from GM's failure to make a success of the
strategy."
Zhong Zhi, a Beijing-based independent auto
analyst, believes Chinese automotive companies are better looking to their
Asian neighbors for inspiration rather than to the
US
:
"Chinese homegrown auto producers should learn from
Toyota
in
Japan
.
They focus exclusively on producing small and economic cars, all under their
own brand."
Oil
consumption
Statistics show that 20 percent of the
world's carbon dioxide emissions are created by the automobile industry - of
which
US
vehicles contribute some 45 percent. Remarkably, GM vehicles alone account for
31 percent of the total US auto carbon dioxide emissions.
Zhong says: "GM traditionally focuses
on large, gas-guzzling cars, even though consumers have now changed their
preference and are increasingly looking for economic, more environmentally
friendly vehicles."
Early in 1978, with the advent of the second
global oil crisis, GM's rivals in
Japan
,
South Korea
and
Germany
began to shift their focus toward developing smaller, more oil-efficient cars
as a response to the challenges of the energy crisis.
However, GM maintained and even expanded its
output of fuel-heavy pick-ups and SUVs. With increased competition from more
eco-friendly Japanese and Korean imports, GM's
US
market share fell from 50
percent to its current low of 20 percent.
Somewhat belatedly, in the late 1990s, GM
invested $1 billion in the production of an electric car, the EV1. Despite its
popularity in its domestic market, GM pulled the plug on its production in 2000
and it had all but disappeared from US roads by 2004.
Meanwhile, its Japanese rival,
Toyota
, persisted with the
development of its hybrid vehicle, the Prius. It is no coincidence that, in
2008,
Toyota
finally overtook GM to become the world's largest automobile manufacturer.
Looking back, GM's ex-CEO, Rick Wagoner, once admitted that abandoning the EV1
was his biggest regret.
Zhong would agree, seeing GM's fate as
inevitably tied in with its inability to match the changed mood of its one-time
customers: "Along with increasing oil prices, Chinese consumers pay more
and more attention to energy efficiency when they are thinking about buying
cars. However, despite this, some homegrown automakers are now developing
larger and more luxurious cars, even though smaller and more economic cars are
clearly the future of
China
's
auto industry."
Currently, two third of
China
's refined oil supply is
consumed by the automobile industry, a fact that is leading manufacturers to
re-assess their future production priorities.
Li Anding, a senior auto commentator with
Xinhua News Agency, says: "Chinese automakers need to pay attention to the
research and development of new energy sources and new technologies. This will
require a huge long-term investment.
"They should learn from Volkswagen and
Fiat, companies which now have a distinct focus on the development of practical
and feasible green energy solutions, including economic engines, clean diesel,
and a dual-clutch gearbox, a low-cost route to cutting a vehicle's oil
consumption with not so high cost. There is no need to waste millions or
billions of yuan on the development of unpractical technologies with an unclear
future."
Such concerns will be paramount among many
Chinese automotive companies at a time when the country's industry is already
facing a period of change. The Chinese government announced in its auto
industry restructuring plan earlier this year that it intends to cut the number
of major Chinese auto groups to just ten or less from its current level of 14.
It also wants to see the emergence of two or
three mega-manufacturers, with annual outputs of more than 2 million vehicles
apiece. Last year the top performer was SAIC, which produced 1.7 million vehicles.
(http://www.chinadaily.com.cn/cndy/2009-06/29/content_8331466.htm )
June
26 (China Daily) –A key government agency is inclined to reject Sichuan
Tengzhong Heavy Industrial Machinery's controversial bid to buy the Hummer
brand from bankrupt
US
car giant General Motors, China National Radio (CNR) reported Thursday.
The
National Development and Reform Commission (NDRC), the nation's top economic
planning body, may reject the deal on the grounds that Tengzhong lacks the
expertise and resources to run Hummer's operations, and that the gas-guzzling
brand does not fit in with the country's energy-saving policy, CNR reported,
without citing sources.
The
NDRC is a key government body in approving the Chinese company's overseas
acquisition deal.
Only
the Ministry of Commerce, which together with the State Administration of
Foreign Exchange is also involved in approving such overseas acquisition deals,
has made public comments about the deal.
Tengzhong's
bid is "rational and normal" given the current global financial
crisis, Yao Jian, a spokesman for the Ministry of Commerce, said last week.
But
Yao
said his ministry had
not yet received any application from relevant parties.
Sichuan
Tengzhong Heavy Industrial Machinery, a special-use vehicles and highway
components maker, announced its intention to buy the Hummer brand early this
month, immediately drawing public ire.
"Buying
a fuel-hungry and high-emission brand is directly against the current trend of
energy saving and emission reduction," said Lu Zhongyuan, deputy director
at the Development Research Center of the State Council, the country's cabinet,
at a forum earlier this month.
But
the little-known Tengzhong has repeatedly said that it has the financial
resources and expertise to clinch the deal.
"We
have the financial resources for the Hummer deal from our own sources and also
funding from some financial institutions," its general manager Yang Yi
said last week.
Both
GM and Tengzhong have refused to disclose the financial terms of the deal,
which has not been formally signed yet.
Analysts
have estimated the deal size at between $100 million and $500 million.
Chinese
website Sina.com reported yesterday that the two sides were planning to
formally sign the deal on June 28, citing unnamed sources.
But
a person with knowledge of the matter yesterday denied the same to China Daily
saying, "such talk is groundless rumor".
The
government is encouraging domestic firms to go abroad, while also stepping up
its regulation of overseas acquisitions after some recent deals incurred
losses.
Last
week, the NDRC issued a notice requiring Chinese companies to report intended
overseas acquisitions to the government before they sign any legally binding
contracts.
(http://www.chinadaily.com.cn/china/2009-06/26/content_8325180.htm )
China
car sales jump 'beyond imagination'
June 11 (Agencies) -- Zhao Hang, who helped devise
China
’s
auto-stimulus package, is facing demand from car buyers battling an unexpected
consequence - two-month waiting lists.
"Eight friends have asked me to make calls or write notes to
contacts to help speed purchases," Zhao, president of the
China
Automotive
Technology & Research
Center
said in an interview. "Given
the world economic situation, demand for cars is surprisingly strong in
China
."
Beijing drivers, used to leaving showrooms with new cars the same day,
now have to wait about three weeks for a Hyundai Motor Co. Yuedong Elantra,
China's bestselling car, or as long as eight weeks for a Honda Motor Co. CR-V
sport utility vehicle. Carmakers failed to predict a 14 percent sales jump
caused by an economic rebound, tax cuts and subsidies and are now trying to
raise Chinese output even as they cut US and European production on plunging
sales
"We are having headaches and
shortages because the automaker can't make enough Yuedongs," said Li
Minghui, a salesman at dealership Beijing Hyundai Boshishan. "We expected
sales to pick up at the beginning of this year, but it's beyond our imagination
that it would be this good."
The China Association of Automobile Manufacturers in January forecast a
5 percent increase in 2009 auto sales after demand declined in four of the last
five months of 2008 amid the global recession. That would have been the slowest
pace in 11 years. General Motors Corp, the largest overseas automaker in
China
, made a
similar prediction.
Sales Surge
Instead, auto sales have surged after the government offered subsidies
to drivers in rural areas and cut retail taxes as part of a wider 4 trillion
yuan ($585 billion) economic stimulus plan. The demand jump has caused GM to
double its 2009 industrywide growth forecast. Combined with a 37 percent slump
in
US
auto sales because of
the recession, the surge has made
China
the world’s largest auto
market so far this year.
"Customers have to book in advance because there's not enough stock
of the bestselling cars," said Guo Yong, information manager at Beijing
Asia Games Village Automobile Exchange, which houses dealerships accounting for
about 10 percent of Chinese car sales. "Fourth-quarter sales weren’t that
good last year and most carmakers curbed production as they were pessimistic
about sales this year."
Industrywide production trailed domestic and exports sales by about
300,000 vehicles in the six months ended May, according to the China Passenger
Car Association. That's helped push new vehicle stockpiles to near two-year
lows.
Production Increases
To increase supplies of Yuedongs and other models, Beijing Hyundai Motor
Co., Hyundai Motor Co.'s main
China
venture, ran plants at near-full capacity last month. Inventories had dropped
to 80 percent of monthly sales, said President Noh Jae-man. Volkswagen has also
added 50,000 vehicles to its 2009 production plan because of the demand jump.
"The development of the passenger-car market in the first quarter
exceeded our expectations," said Winfried Vahland, Volkswagen’s
China
head.
Honda's two ventures in
China
have been running with three shifts because of demand for models including City
cars and CR-Vs, the bestselling SUV in
China
. Still, the company hasn't
yet decided to expand capacity on concerns demand may not be sustainable, said
Zhu Linjie, a Beijing-based Honda spokesman.
The tax cuts and subsidies may have caused a short-term sales surge that
will fade over the coming months, said Ricon Xia, a Daiwa Institute of Research
(HK) analyst in
Shanghai
.
Both stimulus measures are due to expire at the end of the year.
"It is not yet clear how demand will go in the second half,"
Xia said.
In May, passenger-vehicle sales surged 47 percent from a year earlier,
the most since February 2006.
Parts Logjam
The biggest logjam for Chinese automakers seeking to raise production is
a shortage of parts, particularly more complex components, such as automatic
gearboxes, generally imported from overseas. These are in short supply as
plunging auto sales in the
US
,
Europe and
Japan
,
coupled with the collapse of GM, has forced partsmakers into bankruptcy.
"Component-makers going out of business is causing headaches for
carmakers in
China
,"
said Qin Xuwen, a senior analyst at Orient Securities Co. in
Shanghai
. "It will take a couple of months
to fix this."
To safeguard future supplies, Chinese companies are buying overseas
partsmakers. BeijingWest Industries Co. in March agreed to acquire the
remaining global suspension and brake businesses of Delphi Corp., the bankrupt
former GM parts units. The same month, Geely Holding Group Co.,
China
’s biggest
private automaker, agreed to buy Drivetrain Systems International, an
Australian gearbox-maker that was in receivership.
Such deals may help boost Chinese vehicles supplies in the long run. For
now though, drivers may have to continue waiting.
"People are lining up for cars, and vehicles are going out of
stock," Zhao said. "Who could have expected that last year?"
(http://news.xinhuanet.com/english/2009-06/24/content_11595260.htm )
China
's auto import volume down 30% in first 5
months
June 11 (Xinhua) --The combined volume
of Chinese imported vehicles stood at 4.38 billion U.S. dollars from January to
May, a decrease of 30.3 percent from a year earlier, the General Administration
of Customs (GAC) said Thursday.
China
imported a total number of
116,000 units of vehicles in the first five months this year, down 31.9 percent
year on year.
For May alone,
China
imported less than 24,000 vehicles, about 2,000 units less from April.
The GAC attributed the trend partly to the purchase tax cut policy for
Chinese consumers who buy small-capacity cars and the global economic slowdown.
China
in January halved the purchase
tax on passenger cars to 5 percent for models with engine displacements of less
than 1.6 liters.
GAC figures showed that more than 60 percent of Chinese imported
vehicles belonged to those with engine displacements of more than 2.5 liters.
China
's exports and imports shrank for
the seventh month in a row in May as economic downturn continued to dampen
global trade. Exports fell 26.4 percent in May from a year earlier to 88.758
billion U.S. dollars. Imports were down 25.2 percent to 75.37 billion U.S.
dollars.
(http://www.china.org.cn/business/2009-06/11/content_17932904.htm )
China
oil deals flow where
politics less involved
June 25 (Reuters) - Sinopec's $7.2 billion bid for oil
explorer Addax Petroleum is a sign that
China's energy giants find it easier to secure reserves in parts of the world
where there are fewer hang-ups about Beijing owning local natural resources.
Africa and the Middle
East, where Swiss-based Addax has its main assets, are more politically
disposed to
China
than are
developed nations such as the
United
States
, where local politicians blocked
CNOOC's $18.5 billion bid for oil
company Unocal in 2005, analysts say.
Earlier this month,
Anglo-Australian miner Rio Tinto rejected a $19.5 billion tie-up with
China
's
state-owned Chinalco -- a deal that had triggered political and shareholder
opposition.
"At the end of
the day, they may wonder whether it's a waste of time going after targets in
the developed world," said
Macquarie
analyst David Johnson.
"The chances of
success are higher in Africa, South America and
Kazakhstan
than other parts of the
world."
Until now, political
sensitivities in the West have limited
China
's outbound investments in
resources largely to deals executed on the back of loan-for-oil tie-ups.
In the past
half-year,
China
has lent
more than $45 billion to
Russia
,
Brazil
,
Venezuela
and
Kazakhstan
in exchange for
long-term crude supplies.
State-owned Sinopec
Group, Asia's top oil refiner, knocked out rival Korea National Oil Co with an
offer that is more than four times Addax's stock price in November, and which
is
China
's
biggest overseas takeover.
Addax, based in
Switzerland
but operating in Africa and the
Middle East, has been on the radar of Asia's acquisitive energy firms since
February, when CNOOC and
India
's
Oil & Natural Gas Corp were also touted as potential suitors.
The Addax deal will
give Sinopec a strong foothold in oil-rich
West Africa
and Iraqi Kurdistan and a steady supply of oil for its refining operations.
"The listed
company is in desperate need of upstream oil assets to feed its downstream
business," said Gordon Kwan, Hong Kong-based head of energy research at
Mirae Asset Financial, referring to listed Sinopec Corp "Without that, it
would be at the mercy of
China
's
fuel pricing policy."
BIG SHAREHOLDER EYES
EXIT
Sinopec's bid was
also helped by the fact that Addax's CEO, Swiss citizen Jean Claude Gandur --
one of
Europe
's richest men -- is also its
major shareholder with about 38 percent of the company, and was eager to cash
out.
"It's not that
often you have a major shareholder like this -- that's the main reason why this
one became available," said a Hong Kong-based investment banker who has
advised Chinese energy giants on outbound deals, but was not authorized to
speak publicly about the matter, Other Chinese energy firms are eyeing overseas
assets in Africa and the Middle East, though future deals might not be as
simple as Addax, especially if multiple shareholders disagree about the sale of
the target company, bankers say.
CNOOC,
China
's
top offshore oil and gas producer, has hired Goldman Sachs to advise it on a
bid for a stake in Africa-focused oil and gas firm Kosmos Energy, in a deal
that may be worth about $3 billion.
Sinopec's deal with
Addax, if completed, should help meet the Chinese giant's need for quality
upstream assets to feed its refining business, analysts say. At least 60
percent of Addax's shareholders must approve the deal.
Sinopec Group, parent
of Sinopec Corp, may inject Addax's upstream assets in
Nigeria
,
Gabon
and
Cameroon
, as well as the
Taq Taq field in the Kurdistan region of
Iraq
, into its listed unit by the
year-end, analysts said.
Sinopec Group lost
about $16.7 billion in its refining businesses last year, as soaring crude oil
prices in the first half-year and low state-capped fuel prices squeezed
margins.
(http://www.reuters.com/article/innovationNews/idUSTRE55O1QN20090625?pageNumber=2&virtualBrandChannel=11569 )
China
to store more oil in by 2015
June 16 (Xinhua) -
BEIJING
-
China
is expected to stockpile 70 million cu m of refined oil by 2015, up from 52
million cu m at the end of last year, said industry insiders.
The country's two leading oil producers,
PetroChina and Sinopec, are key to building these refined oil reserves, said
Gong Manying, an executive with China Petroleum Planning and Engineering
Institute. The two companies' stockpile will reach 40 million cu m by 2015, he
said.
Refined oil reserves built by other domestic
companies, including China's third largest oil company CNOOC, are expected to
exceed 28 million cu m, said Gong.
China
has seen a rapid increase in oil reserves
construction in recent years, and the sector has witnessed a 9 percent increase
in capacity annually from 2005 to 2008, said Gong.
Under a three-year (2009-11) blueprint
outlined by the National Energy Administration,
China
will accelerate the
construction of oil reserves to enhance energy security. The country will form
44.6 million cu m of crude oil reserves by 2011.
The blueprint has not disclosed how large
the refined oil stockpile would be in 2011.
Analysts said the timing was just right to
build more reserves of oil products such as gasoline and diesel, as market
demand is benign and stockpiles of domestic refiners are relatively high.
"It can help stabilize domestic
gasoline and diesel prices," said Lin Boqiang, professor,
Xiamen
University
.
The government can use the reserves to ease the pressure of domestic refiners
whenever there is a big gap between domestic and international prices, he said.
Both PetroChina and Sinopec have quickened
the pace of building refined oil reserves. Wang Tianpu, president of Sinopec
Corp, earlier said the company was planning to build four refined oil stockpile
bases in the country. The four bases will have a total capacity of 8 million
tons.
China
has now completed construction
of the first four State strategic oil reserve bases, which are respectively in
Zhenhai and Zhoushan in
Zhejiang
province,
Huangdao in
Shandong
province, and
Dalian
in
Liaoning
province.
The four national oil reserve bases have all
been fully filled with crude.
China
will start building eight more
national oil reserve bases, including one in Huangdao in
Shandong
and one in
Jinzhou
in
Liaoning
.
(http://news.xinhuanet.com/english/2009-06/16/content_11549159.htm )
June 30 (Xinhua) --
China
raised gasoline and diesel
prices by 600 yuan ($87.8) per ton, starting 12am Tuesday.
The increase raised the price for gasoline
by about 0.45 yuan per liter, or 8.6 percent, and the price of diesel by about
0.51 yuan per liter, or 9.6 percent, said the National Development and Reform
Commission (NDRC) in a statement on its Web site.
It was the third oil price adjustment this
year. On May 31, the NDRC raised the pump prices of gasoline and diesel by 400
yuan per ton, or 7 percent and 8 percent, respectively.
The adjustment was in response to
"recent international oil price fluctuation" under the country's new
fuel pricing mechanism, as international crude prices kept rising, said the
statement.
According to the new mechanism,
China
's
domestic prices are to be "indirectly linked" to global crude prices
"in a controlled manner."
Under the pricing mechanism,
China
would consider changing benchmark retail prices of oil products when the
international crude price rises or falls by a daily average of 4 percent over
22 working days in a row.
Oil prices settled at $
69.16 a
barrel on the New York Mercantile
Exchange Friday, registering a 4.2 percent rise from the price of $
66.31 a
barrel when the last adjustment took place on May 31.
(http://www.chinadaily.com.cn/bizchina/2009-06/30/content_8336243.htm )
June 26 (Reuters) --
OLD
TOWN
,
Maine
: From the outside, the
rustic red-brick mill on a bend in
Maine
's
Penobscot River
resembles any other struggling American
pulp and paper mill.
But along with its usual business of
pulp-making, the century-old mill is doing something unprecedented: Developing
technology to produce bio-butanol, a jet fuel, from parts of trees that would
otherwise go to waste, one of the world's first to do so.
Production is still two years away, but the
reinvention of
Maine
's
Old Town Fuel & Fiber mill is already drawing interest as a potential model
for a new wave of biofuel companies that could slash dependence on oil, create
jobs and reduce the emissions that lead to global warming.
Loggers, a fading way of life in rugged
northern
United States
and
Canada
, see the
mill as a lifeline for their crippled industry. Environmentalists see it as a
test of the Obama administration's push for a big expansion in biofuels.
And chemical and oil companies are waiting
to see if the mill can do what none has done before by extracting sugars from
wood chips into a biofuel that many regard as more efficient than corn-based
ethanol as a possible substitute for gasoline.
"There has been a lot of interested
parties in what we are doing here," said
Old
Town
's
president, Dick Arnold. "There have been several oil companies that have
been interested in our extract and production of biofuels. There has been a
number of chemical companies that have expressed the same desire."
Like its once-mighty peers, Old Maine's mill
has suffered in recent years from declining pulp prices and loss of market
share to overseas rivals.
Georgia-Pacific Llc, the maker of Quilted
Northern bathroom tissue, shut it in May 2006, laying off all 400 workers. A
group of investors known as Red Shield bought it a few months later.
Red Shield won a $30 million grant from the
US Department of Energy to work with the nearby
University
of
Maine
on a pilot ethanol production plant, but they ran out of cash and filed for
bankruptcy last year, shutting the plant again.
Enter Lynn Tilton, a
New York
venture capitalist who owns one of
the nation's largest helicopter makers. Tilton's Patriarch Partners bought the
mill in November, invested about $40 million and shifted its focus to
cellulosic bio-butanol.
Alternative
to ethanol
Tilton can use bio-butanol in her own
helicopter and aircraft businesses but is eyeing a potentially huge market
after Congress decreed that the
United
States
must use 21 billion gallons of
"advanced" biofuels such as cellulosic ethanols, bio-butanol and
"green gasoline" a year by 2022.
Whether the technology takes off comes down
to cost - and to corn. For much of the last decade, federal officials have
touted the potential of corn ethanol as the best substitute for gasoline, but
critics question that assumption, noting it corrodes pipelines and raises food
prices.
Bio-butanol, a relative of ethanol, is less
corrosive and easier to mix with gasoline. Unlike ethanol, it can be
transported by pipeline. And its energy content is about 30 percent higher than
ethanol's. If regulations allow, it could be pumped into a fuel tank with no
changes to a car engine.
Butanol is also sometimes used as a
petrochemical in brake fluids, paint thinners and plastics. Its supporters
include chemicals maker DuPont Co and oil giant BP Plc, which have formed a
joint venture to make bio-butanol.
"It's really comparable to
gasoline," said Mark Bunger, a biofuels analyst at Lux Research, a
Boston
consulting firm
specializing in emerging technologies. "The issue has been that ethanol is
easier to make, it's just not easier to use. Butanol doesn't have those same
restrictions.
"For a lot of chemical reasons, it's a
good alternative. If you're a venture capital company and you said you are
going to be making ethanol, I would say, 'Do you have another idea?'. But if
they are really focusing on butanol, that is a smart move."
He cautioned, however, that it remains
unclear if bio-butanol can compete on cost with oil or substitutes like ethanol
without government subsidies. "A lot more research and technical
development is needed to make it cost competitive."
Other companies are trying, such as startups
Tetravitae Bioscience in
Chicago
and Cobalt
Biofuels in
Mountain View
,
California
. But
Old
Town
is the first to do so with a fully functioning timber mill that already
generates cash flow by selling traditional pulp to paper companies.
Bio-butanol will be derived from wood that
would have gone to waste in pulp production, or have been left on the forest
floor as unusable by loggers.
"I wouldn't go deep into a hole without
the ability to generate cash flow on what we do now," Tilton said.
"That is the beauty of this. We are not building a start up facility to
create ethanol where you are out $300 million before you start creating any
kind of cash flow."
(http://www.chinadaily.com.cn/world/2009green/2009-06/01/content_8093401.htm )
June
6 (Reuters) – BEIJING - Sinopec and PetroChina, both listed in Hong
Kong, plan to raise their crude oil processing output in June to record-high
levels after some plants completed maintenance, encouraged by the recent fuel
price increase and falling fuel stocks.
The
central government raised diesel and gasoline prices on June 1 by 6-7 percent,
the second and biggest increase this year, easing some pressure off refiners
faced with rising crude oil costs.
Twelve
major plants accounting for more than a third of the mainland's capacity, most
of them on the eastern and southern seaboards, will process 2.59 million
barrels per day (bpd) of crude in June, up nearly 10 percent from the actual
2.36 million bpd in May, a Reuters poll showed.
The
level would be the same as the record-high crude runs in October and represents
almost 92 percent of their total refining capacity.
Analysts
said the prospect for fuel demand, especially gasoline and diesel, looks rosy
given steady increases in automobile sales and recovering industrial
activities, while the recent fuel price rise provided an additional incentive
for production.
"Refining
margin in June will be better than in May after the recent price hike,"
said Qiu Xiaofeng, an analyst with China Merchants Securities.
"But
refiners may feel pressured later this month and in early July if there are no
further fuel price increase, because they are going to process more costly
crude oil imported last month and now."
US
crude prices near $
70 a
barrel
have almost doubled since end-December, though still 53 percent below the
record highs above $
147 in
mid-July 2008.
But
sentiment in the gas oil market in the
Singapore
oil hub has improved
slightly, with its prompt crack spreads around $
7.85 a
barrel on Friday, versus less than $6.00 for
most of the past two weeks.
Sinopec's
Guangzhou
refinery in the south and Qilu
refinery in
Shandong
province will increase
operation levels sharply this month after completing regular maintenance, while
several others, including PetroChina's
Dalian
,
also plan to step up processing activity.
But
some refinery officials warned the preliminary plans could be revised in coming
weeks in line with market changes. "A plan is a plan, we have to watch out
what is going to happen in terms of price and demand for both fuel and
chemicals," an official in a coastal plant said.
Fuel
stocks held by the two oil giants continue to decline in April, with diesel
inventories at the end of April falling 14 percent from a month ago and
gasoline dropping 12 percent.
(http://www.chinadaily.com.cn/hkedition/2009-06/06/content_8255389.htm )
June 18 (Xinhua)
- East China's
Fujian
Province
is to substitute
gasoline and diesel oil with liquefied natural gas (LNG) as fuel for 2,000
inter-city buses running on its expressways, to make its public transport
greener.
According to a
contract signed Thursday between Fujian Investment and Development Group Ltd.
and Fujian Expressway LLC, the former will invest 320 million yuan (46.85
million U.S. dollars) in building 30 gas filling stations to supply 133,000
tonnes of LNG for the 2,000 inter-city buses.
The move will
replace 180,000 tonnes of gasoline and diesel a year, the investment and
development company said.
Wang Dongping,
general manager of Zhongmin Logistics Company under the investment and
development company, said Thursday that as a sort of clean energy, liquefied
natural gas could help slash motor vehicle's carbon monoxide, hydrocarbon and
sulphur dioxide emissions by 97 percent, 72 percent, and 90 percent
respectively.
The
"green" energy could also help reduce vehicle noise by 40 percent,
Wang added.
The plan will
include substituting diesel fuel with liquefied natural gas for more than 1,000
sand-, coal- and cement-carrying vessels on the waterways in the province and
along its coast.
Under a related
accord,
Fujian
will buy 2.6 million tonnes of
LNG from
Indonesia
annually in a 25-year period from 2009 to fuel the plan, the local government
said.
(http://news.xinhuanet.com/english/2009-06/18/content_11562205.htm )
June
16 (Xinhua) --
BEIJING
-- The construction of
pipelines that will transport oil and gas to
China
via
Myanmar
will begin in full swing in September, an insider from PetroChina said Tuesday.
The project will open
the fourth route for
China
's
oil and nature gas imports, after ocean shipping, the Sino-Kazakhstan crude oil
and natural gas pipelines, and the Sino-Russian oil pipeline, according to the
insider, who declined to be named.
According to an
agreement signed in March 2009 between the Chinese and
Myanmar
governments, the oil and natural gas pipelines will run in parallel. Both will
start in Kyaukryu port on the west coast of
Myanmar
and enter
China
at the
border city of
Ruili
in
China
's
Yunnan
province.
The 1,100-kilometer
oil pipeline will end in
Kunming
, capital of
Yunnan
Province
.
It is expected to transfer 20 million tonnes of crude oil to
China
from the Middle East and
Africa
annually.
The natural gas
pipeline will extend further from
Kunming
to
Guizhou
province and the
Guangxi Zhuang Autonomous Region, running a total of 2,806 kilometers. It is
expected to transport 12 billion cubic meters of gas to
China
every year.
The Sino-Myanmar gas
pipeline will further increase
China
's
gas import, which is projected to exceed 100 billion cubic meters over the next
few years.
Compared with ocean
shipping, the oil pipeline can reduce the transport route by 1,200 kilometers,
experts said. What's more import, it will reduce
China
's reliance on the Straits of
Malacca for oil import.
China
has imported more than 10 million tonnes of crude oil through the
Sino-Kazakhstan oil pipeline, which was put into service in 2006. Sino-Russian
oil pipeline is also expected to put into use by the end of 2010.
(http://news.xinhuanet.com/english/2009-06/16/content_11552020.htm )
June
16 (China Dialogue) -- Since the 1990s, there has been a growing interest in
identifying and quantifying emissions of greenhouse gases in order to
understand their impact on the global atmosphere. People have begun better
understand the origin and impacts of different greenhouse gases. Emissions
today are determined through a variety of methods including macro-level models,
direct measurement, calculations and estimations. Understanding of the
accuracy, value and applicability of each of these is increasing with
experience and time.
China
– which, according to the Netherlands Environmental Assessment Agency, is now
the number one emitter of carbon emissions – is a natural next
centre for infrastructure related to greenhouse-gas measuring and reporting. It
is clear that
China
will benefit greatly from transforming into a resource-efficient and largely
energy self-sufficient economy.
China
also stands to gain significantly by becoming a leader of environmentally
friendly technologies and policies. This reality is reflected by
Beijing
’s ambitious
energy-efficiency targets, which – if implemented – stand to be some of the
most environmentally progressive policies in the world.
However,
to meet those targets,
China
will need to develop a system to quantify energy use and greenhouse-gas
emissions. This system must be growth-oriented, transparent, accurate and
reliable, in line with international standards and accompanied by a system of
third-party verification. An online carbon and energy registry will support
China
’s drive to meet its own energy targets,
facilitate bilateral cooperation between
China
and the
US
on climate change
and support
China
’s
participation in international agreements on carbon reduction. This registry
needs to come online soon if
China
will be able to meet its targets for the next five to 10 years. But questions
remain about how to implement such a tool, who should administer it and the
methodology to use.
How
to best measure emissions may depend on the reasons for asking. For instance,
national governments may use top-down assessments, based on economy-wide
assumptions to inform national climate-change policies. Regional trading
systems rely on precise calculation and measurement of discrete activities
associated with specific emissions reduction projects at a relatively small
geographic location. Regulators want comparable data to evaluate performance of
similar facilities: for example, comparing one manufacturing plant to another
to understand reductions over time. Companies may want to understand the
footprint – including any associated liability or risk – from the full scope of
their operations in order to be good corporate citizens.
There
is a very strong case for such a website-based voluntary reporting program in
China
. Over the
last 12 years, a growing number of the world’s largest companies have
incorporated greenhouse-gas accounting into their standard business practices
in order to understand their own contribution to global emissions. And they are
looking to their suppliers, competitors and customers to do the same. In
China
, such
efforts are nascent, presenting an opportunity to build on existing experience
and start with strong, rigorous accounting. The best way to do this is to
follow the model developed in
California
by
the Climate
Registry and the California Climate Action Registry, which together have 500
members, including some of the biggest emitters in the
United States
.
This
model is based on The
Greenhouse Gas Protocol: A Corporate Accounting and Reporting Standard (known as “the GHG Protocol”), created by the World Resources Institute and the
World Business Council on Sustainable Development. The GHG protocol provides
programme-neutral, high-level accounting standards that are widely considered
international best practice for determining a corporation’s responsibility for
greenhouse-gas emissions. Different from the traditional pollution-control
approach of tracking emissions on a unit or facility basis, the GHG Protocol
takes precedent from financial accounting standards and assigns responsibility
for emissions activities to a corporation, according to ownership of different
sources or facilities. Given the global nature of greenhouse gases, this
approach acknowledges that each company’s footprint may result from a wide
number of activities that it can directly or indirectly control, including
mobile sources and electricity use, in addition to activities like power
generation and heavy manufacturing.
The
GHG Protocol establishes a language of greenhouse-gas accounting. This includes
setting the reporting boundaries around a corporation (“entity”) and defining
what is to be reported or not. This is based on the entity’s operational or
financial control or sources, or its equity share in each source. Perhaps most
significantly, the GHG Protocol defines scopes for counting purposes. When
considering an entity’s footprint, there may be:
*
Scope 1 – Direct emissions: emissions that are within the control of the
entity, defined as from stationary combustion, mobile combustion, chemical or
manufacturing processes, or fugitive sources (unintentional releases).
*
Scope 2 – Indirect emissions: emissions of which the consumption is controlled
by the entity, but the generation is not: purchases of electricity, steam,
heating or cooling.
*
Scope 3 – Indirect emissions from everything else: emissions associated with
the use of products that are manufactured, employees commuting to work,
performing business travel and so on.
By
breaking emissions responsibility into scopes, an organisation can build up its
entire footprint. Every Scope 2 emission from electricity consumed by an
end-user may also be counted as a Scope 1 emission by the electricity
generator. Breaking emissions into scopes helps assure that emissions are not
double-counted on a broad scale.
In
addition to a solid methodology, a registry must have a good business model.
There should be a strong incentive for businesses to disclose their energy use
and greenhouse-gas emissions data – information that is usually not identified
or shared. There are many business-friendly arguments for joining a
greenhouse-gas registry. First, by reporting to a registry, enterprises in
China
can
promote and publicise a green image. Second, while increasing transparency and
putting in place internal systems to measure and monitor energy use, some
companies can reduce energy costs and get a head start on reducing carbon
emissions.
Business for Social Responsibility has pointed out that many
of the concerns the business community has about joining a registry are
unfounded. For example, businesses that worry about the administrative cost of
generating accurate data usually find that the benefits of tracking data are
greater than the cost. Businesses that worry about unnecessarily revealing
information about their operations, or having that information used against
them, find that fears about disclosure are often exaggerated: disclosure leads
to stakeholders having more confidence in the company and view it as less of a
risky investment. Finally, for those that worry that this type of data-sharing
will violate privacy and open floodgates for other requests, find instead that
collaborating with stakeholders holds an opportunity to set beneficial terms in
the future.
To
conclude, a China-based registry to quantify carbon emissions in a measurable,
consistent and verifiable way is the necessary first solid step toward any
larger climate-change solution and an important prerequisite of both bilateral
and multilateral cooperation on climate change. A registry will move
China
away from
its negative image as the biggest polluter in the world – towards being seen as
a responsible, resource-efficient, energy self-sufficient country, which can become
a leader in green technology.
China
stands to gain a lot from this development.
Author Lucia Green-Weiskel
is a project officer at the Innovation
Center for Energy and Transportation in
Beijing
. Robyn Camp is vice president of
programmes at the Climate
Registry in
Los Angeles
.
iCET and TCR are currently working in partnership to develop the Energy and
Climate Registry: the first web-based voluntary reporting greenhouse gas and
energy efficiency registry in
China
.
For more information on the China-based registry, please contact Lucia at LuciaGW@icet.org.cn
(http://www.chinadialogue.net/article/show/single/en/3088-Accounting-for-China-s-carbon )
June 26 (AFP) -
China
, deemed vital to the fight against global warming, is now taking
the issue of climate change "extremely seriously," EU Commission
chief Jose Manuel Barroso said Friday.
Meanwhile
US
President Barack Obama had
effected a "sea-change" on environmental policy there, he said.
China
had
become "fully and constructively engaged in the international
negotiations, while domestically it was pursuing very ambitious targets to
reduce energy intensity by 20 percent under its current five-year plan,"
said Barroso in a speech to close the EU's Green Week.
He offered special congratulations to experts
at
Chinese
Academy
of Sciences for their
"influential work on climate policy" adding that "we fully share
your view that low-carbon development has to be the way forward."
The
United
States
and
China
are the world's two largest
emitters of greenhouse gases that cause global warming.
As a developing country
China
is not bound by the current
Kyoto Protocol on climate change and says the bulk of the responsibility for
emissions cuts lies with developed nations.
But it has pledged to play a constructive
role in the climate negotiations in
Copenhagen
in December, while implementing domestic energy targets and developing
alternative and clean energies.
Barroso said that "all countries except
the very poorest will need to contribute" to the efforts to keep global
warming down to two degrees centigrade, though with the developed countries
taking the lead.
"While we are not there yet, the
prospects for agreement at
Copenhagen
have brightened over the past year," he said.
Barroso's European Commission announced
Wednesday that it would provide financing up to 50 million euros (70 million
dollars) to help China build a coal-fired power plant equipped with new carbon
storage technology to give it near-zero emissions.
Europe deems the carbon capture and storage
technology, which is in its infancy, to be a key factor in fighting climate
change, and a demonstration plant would be particularly significant in
China
,
which produces and uses a massive amount of coal.
Barroso also said the world was paying
abnormal attention to the machinations of the
US
government on climate change
policy under President Barack Obama.
"President Obama?s personal commitment,
both to domestic action and to a successful outcome in
Copenhagen
,
has amounted to nothing less than a sea-change in the
US
position," he said
"His leadership means that the
United States
is now back at the table," Barroso added. "Rarely, perhaps, has the
progress of
US
domestic legislation been so carefully monitored internationally."
The "American Clean Energy and Security
Act" aims to reduce greenhouse gas emissions 17 percent from 2005 levels
by 2020, while creating "green" jobs.
In
Washington
Friday, Democratic House Majority Leader Steny Hoyer predicted his party would
have the 218 votes needed to ensure passage of historic legislation to battle
global warming.
Barroso admitted he was ready to "put
aside the normal conventions here and be very clear.
"We want the
US
to go as far and as fast as they
can on climate change."
But above all,
Europe
wants the bill to succeed, he said.
(http://www.google.com/hostednews/afp/article/ALeqM5gqZa5a---VZZ5ZB-zDQ8RU120J_Q )
June 6 (China Daily) --
China
will put
in place carbon dioxide emissions targets for its economic and social
development programs, the central government has promised.
The change marks a new phase in
China
's pledge
to tackle climate change and global warming with the international community.
It also signals that
China
may be
considering national goals for carbon dioxide levels when it maps its 12th
five-year national development plan (2011-15).
The central government unveiled the change at
Friday's State Council meeting on climate change and vowed to help the
international community achieve "positive results" at the UN
Copenhagen climate change talks in December.
The announcement was made on World
Environmental Day at the meeting chaired by Premier Wen Jiabao and is likely to
be seen as a clear indication that
China
's
leadership is committed to the success of the talks in
Copenhagen
and climate change discussions involving 181 UN members in
Bonn
right now.
China
was
not obliged to meet binding targets for greenhouse gas emissions under the
Kyoto Protocol, which expires in 2012, and has emphasized energy-saving efforts
in its five-year plan during 2006-10.
At Friday's meeting, the State Council also
promised to name and shame provincial governments that fail to meet their 2008
targets of energy conservation and emission control.
According to an accountability system
unveiled in 2007, leading provincial officials who fail to meet the targets
would not be promoted in future.
The changes were part of an eight-point
policy package unveiled by the central government. The government concluded
that
China
has made "important progress" in energy-saving and emission control
during the previous three years.
Compared to the 20 percent energy-saving
target,
China
has already cut 10.1 percent per unit of GDP from 2006-08.
Despite the successes, the government
admitted
China
still faces a "severe situation" and "pressing tasks" in
energy conservation and emission control. All provincial and local governments
are being asked to strictly control energy-gorging and polluting projects.
And the government will continue to phase out
polluting production techniques in the iron, steel and cement sectors and
demolish small coal-fired electricity generators.
The government will support 13 cities in
research and development as well as promotion and sales of cars powered by new
energy.
Included in the policy package, the
government will subsidize 120 million electricity-saving lightbulbs nationwide.
Estimates suggest the savings from using the new bulbs could equal the energy
output of
China
's
biggest power plant, the Three-Gorges Hydro-power Station.
(http://www.chinadaily.com.cn/cndy/2009-06/06/content_8255525.htm )
June 13 (
China
daily) -- China Daily carried a report on Wednesday, saying
China
and the
US
had achieved nothing substantial
at the bilateral climate change talks. But that was not to be, for shortly
before boarding the flight back home on Wednesday afternoon,
US
climate change negotiator Todd Stern told
China Daily: "We don't expect
China
to take a national cap (on
greenhouse gas emission) at this stage."
The report in Thursday's edition carried the
reaction of US environmentalists, who insisted that Stern's stance was
temporary because the Sino-US climate change talks had just begun.
It seems that many American environmentalists
and think tanks are not happy with Stern's performance in
Beijing
. A
US
source even said: "This
kind of language can lead to Stern's resignation". Many interested groups
have pinned high hopes on Sino-US partnership to fight climate change. But they
have expressed concern on the slow progress of their talks, too, especially
after the world's two biggest greenhouse gas (GHG) emitters made climate change
a "primary area" of cooperation after Barack Obama became the
US
president.
Irrespective of the agenda of bilateral talks
or the 12-day UN meeting on climate change in
Bonn
that ended on Friday, accusations and
arguments have dominated conferences and forums.
If talks do not yield positive results and no
concrete agreement on cutting GHG emissions is reached before the UN Climate
Change Conference in
Copenhagen
in December, there is no reason for negotiators, including Stern, to continue
on their posts. The reason for that is simple: if they cannot reach a deal they
do not have the right to fly across the globe to attend meetings and increase
their carbon footprint.
Why amid all this does a climate change
partnership between
China
and the
US
matter? Why some
US
groups
reacted so strongly when Stern said that
China
did not have to put a cap on
its GHG emission for now?
Their logic is that once
China
puts a cap on GHG emission, the
US
can no longer use
China
as an excuse for its own
inaction. It would force the
US
to enter into a global deal at
Copenhagen
to fight global warming, which will succeed the Kyoto Protocol after it expires
in 2012.
The
US
groups criticized Stern for failing to fully grasp the meaning of
China
expressing willingness on the eve of his visit to put carbon intensity
reduction into social and economic development programs. They say Stern is
"too mild", though the general agreement in the Chinese media seems
to be that he is "shrewd negotiator".
Only six months are left before the
Copenhagen
conference. But
negotiators are still using vague language and weird proposals to serve their
countries' interests. There has been one significant shift, however. The
US
that refused to ratify the Kyoto Protocol under George W. Bush, saying putting
a cap on GHG emission would slow down American economic growth, has under Obama
realized that developing clean energy and green technologies can actually
create economic opportunities.
But the US Congress wants
China
to first set a mandatory GHG
emission target. John Kerry, prominent senator and former
US
presidential candidate, has been quoted as
saying: "There's no way we are going to get an agreement in the US Senate
unless they (meaning
China
)
reduce their emissions."
This is weird logic. Finger pointing is going
to lead us nowhere. Why can't we forget mandatory and voluntary GHG emission
cut targets for the time being and deal with the basic aspects first? At the
global level, failure to achieve targets doesn't invite legal action. We don't
see any of the 37 countries in the Kyoto Protocol Annex 1 being punished for
its failure to meet its 2008-12 emission cut goals. Punitive action is not
likely to be suggested at the
Copenhagen
conference either.
If we cannot do take punitive action, can we
at least change our negotiation language and go back to basics? Can we devise
an incentive package to encourage work on finding substitutes for fossil fuel? Can
WTO play a leading role in discussions on how technologies should be traded
freely? And can we stop politicizing climate change, and focus on
life-and-death questions, because fighting climate change is a matter of life
and death?
(http://www.chinadaily.com.cn/cndy/2009-06/13/content_8280132.htm )
June 19 (China Daily) -- Major
state-owned enterprises (SOE) ignored energy saving and pollution regulations,
said a report published by National Audit Office (NAO) yesterday.
The central government has annual targets to
reduce energy consumption and pollution emissions for the country's 1,000 heavy
polluting and high energy-consuming enterprises based on China's 11th five-year
(2006-2010) plan.
Sources from the Ministry of Environmental
Protection (MEP) said enterprises found violating environmental laws would be
severely punished.
NAO's inspection of 41 such SOEs showed that
some failed to fulfill energy-saving targets on time in 2007.
Zhangjiaokou coal-fired power plants owned by
China Datang Corp achieved only 19.3 percent of their energy saving goals in
2007.
Meanwhile, the energy consumption for
producing electrolytic aluminum at Baotou Aluminium Co increased by 1.83
percent, instead of decreasing.
Similarly, the emissions of sulfur dioxide
(SO2) from 10 of the 41 SOEs failed to reach standards.
The NAO report said one enterprise's SO2
emissions in 2007 were 1.41 times higher than the national standard, but it did
not give the name of the business.
Another nine enterprises recorded a higher
level of emissions of other major pollutants, such as chemical oxygen demand
(COD), than permitted. The concentration of COD from one enterprise was five
times higher than the standard set by local government, the report said,
without naming the company.
The improper treatment of industrial waste
also resulted in potential environmental risks, the report found.
For instance, a total of 209,800 tons of
hazardous wastes were handed to unlicensed recycling companies, while another
108,000 tons were simply buried or stored without proper treatment.
The solid wastes from two aluminum-producing
firms led to soil pollution following a lack of effective prevention measures.
The detailed information of the enterprises'
misdeeds has been reported to National Development and Reform Commission (NDRC)
and MEP, the authorities that oversee the energy efficiency and emission
reduction.
NAO also proposed that the NDRC and MEP
should strengthen monitoring of these enterprises.
Companies involved in the illegal treatment
of hazardous wastes will be fined according to the law.
China
has
set targets to improve energy efficiency by 20 percent, and reduce emissions of
SO2 and COD by 10 percent by 2010 from the 2005 level.
The country's energy consumption per unit of
GDP has already dropped 10.1 percent from 2006 to 2008. Emissions of SO2 and
COD, also fell by 8.95 and 6.61 percent, respectively.
The 41 SOEs invested a total of 16.89 billion
yuan ($2.5 billion) on energy saving and emissions reduction between 2006 and
2007, and 36 achieved their five-year plan to reduce coal consumption by 87,981
million tons within two years, said the report.
(http://www.chinadaily.com.cn/cndy/2009-06/19/content_8300020.htm )
June 18 (China Daily) -- Climate change has
emerged as the main reason for poverty in
China
as over 95 percent of the
poor live in ecologically fragile areas and are the most affected by the
changing patterns, according to a new report.
The report goes on to add that a map of
China
's
poverty-stricken areas overlaps the map of the country's ecologically fragile
regions.
Titled "Climate Change and Poverty: a Case
Study of China", the report released yesterday was initiated by Greenpeace
China and Oxfam Hong Kong, with joint efforts of experts and researchers from
the Chinese Academy of Agricultural Sciences (CAAS) and local meteorological
officials in Sichuan, Guangdong and Gansu.
It said in the past 50 years, the direct
economic losses at Mabian county in
Sichuan
province due to torrential rain and flood-related disasters have dramatically
increased. From 2001 to 2008, the average annual direct economic losses were
around 23.8 billion yuan, compared to 9.7 billion yuan in 50 years.
Lin Erda, a member of
China
's national climate change expert panel and
a senior researcher with the
Chinese
Academy
of Agricultural Sciences, however, feels that
China
has an outstanding track record in poverty alleviation.
According to statistics by State Council
Leading Group Office of Poverty Alleviation and Development, there were 250
million people living in absolute poverty in the country. By 2007, however, it
had shrunk to 14.8 million, accounting for 1.6 percent of the country's total
population.
However, case studies from
Guangdong
,
Sichuan
and
Gansu
provinces show that global warming
does induce floods, snowstorms and landslides, which are detrimental to
ecologically sensitive areas and hamper poverty relief efforts.
"The current poverty alleviation
projects in
China
are mainly focused on income improvement. Money helps only those people who are
living in ecologically favorable regions as natural disasters often push people
in the sensitive regions back into poverty," said Xu Yinlong, a CAAS
expert.
"China's poverty alleviation efforts for
the past few decades could be seriously undermined unless the government takes
the initiative to forge an aggressive climate rescue treaty in the Copenhagen
climate conference in December," said Li Yan, Greenpeace China climate
campaigner.
"Developed countries are largely
responsible for causing climate change. They should provide at least $50
billion annually to help developing countries take measures to adapt to climate
change," said Li Ning, officer of Oxfam's Climate Change Program.
Li added that the developing countries,
including
China
,
should give priority to climate change adaptation measures, such as
anti-drought and anti-flood crops, improving infrastructure and elevating
bridges and roads in flood-prone areas."
Ma Jianjun, a 19-year-old Hui ethnic boy, is
one of thousands of children who grew up at
Hongsipu Development Zone
,
China
's
largest relocation and poverty reduction project that has been built on a broad
stretch of reclaimed desert in Ningxia Hui autonomous region.
Ma recalls that when his family lived at
Xihaigu, a place which was listed as one of the world's most uninhabitable
zones by the United Nations World Food Program due to its extreme environment,
they did not have enough to eat and had an annual income of about 500 yuan or
even less and the place was very windy and dusty all year round.
The relocation has helped hundreds of
thousands in Ningxia enjoy a better life after the local government began the
program in 1998.
Covering about 2,000 sq km, Hongsipu now has
more than about 2,700 hectares of irrigable land and is home to 200,000
migrants.
In 2008, the GDP of Hongsipu was 502 million
yuan, an increase of 12.9 percent over the previous year, while farmer's
average net income reached 2,660 yuan, a 16.5 percent increase.
However, Chinese farmers' average net income
stood at 4,761 yuan in 2008.
Li of Oxfam said ecological migration needs a
huge amount of investment and also takes a long time to bear fruit.
(http://www.chinadaily.com.cn/cndy/2009-06/18/content_8295678.htm )
June 15 (China Daliy) Excuse me, which war
are we fighting: The war against climate change, or a war over climate change?
We (by that I mean all the people in the
world) will most likely have a war of the second sort. That is, if most
conditions laid out by various countries - in the run-up to the UN climate
change conference, slated for Dec 7-18, 2009, in
Copenhagen
- is any indication.
In such a war, the industrialized countries
are unwilling to commit to any significant cutback on their emissions unless
(as they demand) the larger developing economies, at the same time, are willing
to pledge mandatory caps on their emissions.
The developing countries are insisting that
the industrialized countries take the lead, as the latter are responsible for
the atmosphere's accumulation of greenhouse gases (GHG) in the last 200 years.
We have only one atmosphere, and it is just
like we are living in one house. If someone has occupied the main room for too
long, as the argument goes, that person should be asked to pay the main part of
the rent.
China
is asking the industrialized countries to set an example by cutting
their emissions by 40 percent before they are joined by the rest of the world,
while
India
is reportedly asking them to cut almost 80 percent, both based on their own
reasoning.
The industrialized countries do not want the
developing countries to stay on the voluntary side of the equation. They are
demanding that they, the larger ones in particular, also commit to mandatory
cuts as those countries are now also becoming important emitters.
Pointing to other people's shortcomings may
be a statement of truth, but it may also disguise one's own inadequacies. And,
indeed, some industrialized countries have failed to implement the emission
cuts they had pledged under the Kyoto Protocol.
Developing countries can easily find more
defense of their position that the industrialized countries should take the
lead by citing their still low per capita emission records.
There is one more weapon yet to be used. That
is the huge amount of manufactured imports by the industrialized countries from
the developing ones. Considering the GHG emissions inevitably involved in the
making of these, the importers may be asked to pay additional tariff for having
caused the demand.
The issue of climate change, one that is
facing the whole world, is thus being vitiated; and, turned into a political
tussle between two camps that are jealously guarding their conflicting
short-term interests.
Let's be straightforward. Despite the
so-called positive notes and diplomatic courtesies, if the situation remains so
divisive, chances of reaching a workable compromise are slim. The result of the
world conference would be a far cry from any meaningful framework for emission
control - in both developing and industrialized countries. The event would then
be remembered as an embarrassment for all governments, and the UN.
Even if, on a lofty whim, all countries do
come up with an impressive charter, and compete for the deepest emission cuts,
what use would such promises be if they can't be delivered?
Why cannot countries find other ways of
working together rather than assigning (or proposing) difficult tasks for one
another only to be rejected, or get stuck with a broken promise?
Why must policymakers let such a potentially
endless and fruitless bargaining game exhaust them while actually spending no
time on solving the real problems?
Maybe, the
Copenhagen
conference should create a forum
for people to design alternative roadmaps. One alternative could be to
structure a system of rewards and penalties on different countries' emission
control performance. And, with help from the WTO and international financial
institutions, consider the possibility of developing this system as a global
business model.
(http://www.chinadaily.com.cn/bizchina/2009-06/15/content_8286064.htm )
