A recent recovery in steel and coal production in China has posed a challenge to the country’s war on pollution, aimed at reversing the damage done to its skies, soil and water.
As both industries represent two of the largest polluting sectors in China, some analysts are expressing concerns over their negative impact on the country’s air quality although many remain convinced that, in the long run, China will achieve its 2020 environmental targets for energy consumption and reduction of carbon and pollutant emissions, laid down in its latest five-year plan.
Rising steel output
A recent report released by Greenpeace East Asia said China’s steel industry actually saw a net increase of 36.5 million tons in operating capacity last year, despite October claims that the country had already met its 2016 reduction target of 45 million tons of steel capacity.
According to its global coal campaigner Lauri Myllyvirta, local governments in China have maneuvered to shield zombie steel mills so as to minimize the impact of the central government’s environmental policies.
Yet increasing steel capacity makes neither economic nor environmental sense as global markets are still awash with steel and northern Chinese provinces suffer from worsening smog, he added.
“There was definitely a setback in the fight against air pollution in the sense that improvements in the most polluted areas surrounding Beijing and so on [had] stalled and even reversed during the past twelve months.” Myllyvirta told VOA.
China is already the world’s largest carbon dioxide emitter, accounting for more than one-quarter of global carbon dioxide emission.
Curbs on coal
Coal-fired power plants would pose another bigger headache to worsen the country’s air quality as they are the biggest contributors to sulfur dioxide and particle emissions nationwide, according to Greenpeace.
But positive steps have been taken according to the group.
“One thing that we’ve been very concerned about is that there was still very aggressive expansion in coal-fired generating capacities in 2015 and 2016. But luckily, in the past few months, the government has taken very strong steps to suspend new projects and even stop projects that are already under construction,” Myllyvirta said.
In early January, China ordered the suspension of 103 coal power projects, nearly half of those 210 new plants approved since 2015. By doing so, China hopes to cap its coal-fired capacity below 1,100 gigawatts.
Rising coal output
After an aggressive year to reduce excess coal capacity in 2016, China has earmarked a less ambitious goal this year as authorities foresee difficulty in scaling back coal production due to rising prices and concerns over lost jobs.
The government aims to close down 500 coal mines in 2017 totaling a combined production capacity of 50 million tons, or 20 percent of last year’s 250-million-ton goal, according to the National Energy Administration (NEA) on Friday.
The NEA expected coal output will rise 5.8 percent this year to 3.65 billion tons, which will mark an end to a three-year streak in declining output, according to local media.
Duan Lei of Qinghua University’s School of Environment, found this year’s scaled-back adjustments, seen in the steel and coal sectors, “reasonable and practical” as the government needs to strike a balance between economic growth and environmental protection.
“As the economy rebounds, the environment protection ministry will have a harder time to address [the country’s] environmental concerns,” Duan said, adding that the country’s fight against air, soil and water pollution remains a huge task ahead.
Difficulty remains in shutting excess capacity with heavy industry, which is seen as an important contributor to gains in energy efficiency and reductions in carbon and air pollution.
But, polluting industries which are currently ramping up output will be in a better financial position to put down investment in order to comply with environmental standards, the professor argued.
Shift toward renewables
Both Duan and Myllyvirta are upbeat with China’s abilities to meet its 2020 environmental targets, which include an 18 percent reduction in carbon dioxide per unit of GDP and a 15 percent reduction in energy consumption per unit of GDP, as the country’s overall drive and efforts to shift to cleaner energies have been in place.
To meet the targets, China has announced 2.5 trillion yuan ($373 billion) in total investment for new installed capacity of renewable energy by 2020, which includes some $75 billion for hydropower, $104.5 billion in wind and $149.3 billion in solar.
That has represented massive business opportunities for both domestic and international green companies, although some have argued that global investors remain unwilling to put down investment due to a number of government-related risks, including China’s preference for state-owned enterprises over independent firms, its opaque legal and regulatory framework and lack of an enforceable dispute resolution system.