Page 9 - AsiaElec Week 41

AsiaElec POLICY AsiaElec

China’s net zero goal to cost $5 trillion

CHINA CHINA will need to invest over $5 trillion if it is coal-mining activity in key provinces. This
to achieve its recently announced goal of net zero approach aligns with China’s strategy to opti-
emissions by 2060. mise domestic coal resources to improve energy
Research from Wood Mackenzie showed that security.”
the new cash would be most needed to fund new One major hurdle to China’s carbon-neutral
generating capacity to fuel a rapid rise in electri- goal is the lack of scalable low-carbon alterna-
fication by 2050. tives in the transport and industrial sectors. Last
Transport, heating and industry would all year, China’s carbon emissions from these two
need to be electrified, replacing fossil fuels, while sectors reached 5.7bn tonnes, roughly as large
new carbon capture use and storage (CCUS) as the total emissions in the US and the UK
technology would also need to be developed and combined.
built. As a result, these sectors will require gov-
“It is definitely a colossal task for a country ernment subsidies and/or carbon pricing to
using 90% hydrocarbons in its energy mix and decarbonise.
annually producing more than 10bn tonnes of In the AET-2 scenario, Wood Mackenzie
CO2-e, and in addition, accounting for 28% expects China’s carbon price support to reach
of global total emissions,” Wood Mackenzie US$109 per tonne by 2030. China is anticipated
Asia-Pacific head of markets and transitions to become a centre of energy innovation to
Prakash Sharma said: decarbonise difficult sectors.
“In our Accelerated Energy Transition (AET- Under the scenario, China’s road transport
2) scenario, China’s emissions peak immediately must be fully electrified. The total new stock of
and enter a period of rapid decline, reaching electric vehicles (EVs) would hit 325mn units by
net-zero slightly after 2050. This is achieved by 2050, compared with 4mn units today.
wide-scale electrification of transport, heating As a result, oil demand collapses, falling
and industry as well as deployment of carbon below 7mn barrels per day (bpd) by 2050, com-
capture use and storage.” ing primarily from petrochemicals or the export
For China to reach its goal, solar, wind and of refined products.
storage capacity will have to increase 11 times The industry sub-sectors such as steel,
to 5,040GW by 2050, compared to 2020 levels, cement, refining and chemicals would require
Wood Mackenzie said. hydrogen and CCS as mainstream fuel and feed-
Coal-fired capacity, meanwhile, would halve, stock supply options to tackle emissions. Hence
while gas would remain level at 2019 levels. hydrogen production could grow five-fold to
Total generating would rise nearly 2.5 times approximately 150mn tonnes by 2050, equally
to 18,835 TWh by 2050. distributed between green hydrogen (electrici-
“The most challenging part of the shift is ty-based) and blue hydrogen (coal- or gas-based,
not the investment or magnitude of renewable paired with CCS).
capacity additions but the social transition that Sharma said: “Given China’s large heavy
comes with it. Halving coal capacity will result industry and machinery sector, it is crucial that
in [the] loss of coal-mining jobs, affecting prov- China masters the use of CCS and forest sinks to
inces that depend on its revenues and employ- offset the remaining emissions. Without it, Chi-
ment generation,” Sharma said. na’s pledge to become carbon-neutral is nearly
“We expect the government to retrofit impossible.”™
coal-fired power plants with CCS to retain

Week 41 14•October•2020 www. NEWSBASE .com P9