China’s coal addiction and water crisis
Across China thousands of rivers, lakes and streams face disaster; those that haven’t run dry leaving cracked river beds and empty depressions where water once stood are choked full of waste with fish left inedible thanks to decades of unchecked urbanisation, industrialisation and a country with an increasingly intensive agricultural sector. Water pollution is less obvious to visitors than the toxic air that afflicts Chinese cities, but along with polluted land it is causing a water shortage of epic proportions which is forcing the government to respond in order to reverse the crisis.
China’s water problem
China starts in a relatively water poor position, it holds 7% of the world’s freshwater but 20% of its population and it has not been taking care of the supplies it does have, pollution, the increasing demands of farming and rising per capita usage have all put unprecedented stress on freshwater supplies.
A recent investigation by the Ministry of Water Resources (MWR) found that 80% of ground water across the country was polluted. For years factories have pumped out industrial waste and heavy metals, while farmer’s heavy use of fertilisers have created a toxic cocktail which has made much of the nation’s water unusable. Coal mining and production is also a major culprit as it requires huge amounts of water (20% of total use) for washing and cooling, while the biggest share 70% is reserved for agriculture.
Water is used in the extraction and washing of coal, but the biggest demand comes from coal fired power plants as a coolant. To make matters worse the coal industry is largely based in the arid north of the country which has put further strains on water supplies in those regions and led to a the development of an expensive project to divert water from the wetter south. The lack of water is also exacerbating a decade long drought in northern China and slowing the fight against desertification.
The government acts and takes an axe to coal
Now the government is determined to act and improve China’s environmental record and coal is firmly in their sights. Not only does coal use up increasingly valuable water, burning it pollutes the air contributing to the rocketing number of respiratory illnesses suffered by Chinese city dwellers. Of the world’s ten most polluted cities, seven are Chinese while lung cancer rates have soared by 50% in Beijing over the last decade.
So cutting coal production at a time when other energy sources like renewables are becoming more viable seems like a smart move as fewer coal fired powered stations to cool should reduce pressure on the China’s overburdened watercourses and bring other benefits like cleaner air, plus help meet China’s commitments to the 2015 Paris climate accords.
Also China’s economic growth is slowing and shifting away from manufacturing and construction to a more service based model, which means electricity demand has remained steady over the last few years, reducing demand for new power sources.
These arguments compelled the government to order cuts in coal production and this has quickly had the desired effect; Chinese coal production fell off a cliff in 2016 seeing a 9.4% drop a trend which has continued into 2017, this represents a big dent for the heavyweight of world coal – China accounts for nearly half of global production. The government plan to reduce coal production by 500 million tonnes over 3- 5 years, a move which could cost up to 1.8 million jobs.
But the paradox of Chinese coal industry is that as the government aggressively makes cuts in domestic coal production, demand from coal power stations has continued unchecked leading them to look overseas to maintain supplies. As coal remains such a crucial part of China’s energy mix and capacity in renewable and nuclear has not yet been built or integrated with the grid to allow it to fill the gap.
So falling Chinese coal production has had the effect of sucking in now increasingly expensive imports from the likes of Indonesia, Vietnam and Mongolia and aggravating the influential domestic coal industry which has seen jobs losses and foreign suppliers reap short term profits. In my next article I look at how Chinese demand for coal has shaped the fortunes of neighbouring Mongolia.
Categories: climate finance