China's Energy Dragon Looks Tamer to One Forecaster  

Posted by Big Gav in

Scientific American has an article about a somewhat encouraging forecast of future Chinese energy consumption - China's Energy Dragon Looks Tamer to One Forecaster.

Chinese skylines are defined by construction cranes and the din of jackhammers. China produces 50 percent of the world's cement — the next largest producer, India is responsible for just 6 percent—to build seemingly endless tracts of high rises, railroads, parking lots, highways, airports and shopping malls. But all booms end—and China's may end sooner than most people think.

A study released on April 27 by Lawrence Berkeley National Lab's (LBNL) China Energy Group says that this high-growth phase of China's development could wind down in less than two decades. China's energy use will cease to be a great unknown, threatening and shape-shifting as a dragon, and become something that is, if not tame, at least simpler to predict.

The LBNL forecast is the first such survey that attempts to come to grips not only with China's energy and resource needs during the current era of rapid development, but also attempts to pinpoint when that era will end. "Most conventional forecasting techniques use a process that assumes the future is going to look like the past—they establish certain relationships between energy and economic activity, and project forward what will be energy uses in the future," explains LBNL staff scientist and report co-author David Fridley. (He is referring specifically to energy forecasts by the International Energy Agency (IEA) and two scenarios prepared by the Energy Research Institute (ERI), a Beijing think tank affiliated with the Chinese government.) Yet the relationship between economic growth and energy demand is not just a straight line. "Nothing can grow exponentially forever."

Current thinking says China's energy demand will only go up and up throughout this century. The LBNL report, however, projects that after rising steeply for the next 15 years, China's energy growth curve will bend and begin to plateau; demand will then peak by 2050 at between 4.5 billion and 5.5 billion tons coal equivalent (depending on the government's success implementing various energy efficiency targets). That is considerably less than the amount if you simply extended other surveys forward. The report forecasts that energy use per person in China will rise to about 40 percent of what Americans consume.

The insights underlying the LBNL forecast are simple. First, the study simply extends further into the future than many forecasts. (The International Energy Agency's most recent "World Energy Outlook" only looks to 2035 and shows no sign of China's energy demand beginning to level off.) Second, their research takes account of what China Energy Group director Mark Levine calls "saturation points." That is the point at which energy demand in a given sector levels off. In a country where still more than half the population is rural, many people have yet to purchase even basic appliances. "But once you have a refrigerator, you don't need another," he says. The concept is simple, but actually integrating it into forecasting requires looking at the dynamics of each sector, and gathering data that can be hard to come by in China. "What makes our model unusual is that we actually account for the specific number and size of refrigerators, televisions, air-conditioners, and more per household," he says. "If you don't do that, you can't know there's a saturation point."

Take, for instance, the energy needs of China's massive infrastructure build-out. Currently 70 percent of China's energy demand is attributable to industry, and of that, fully 40 percent goes into the production of cement and steel. Yet at some point, China won't need to build as many new highways, bridges and parking lots. To envision the future, the LBNL team examined the total mileage of road networks in developed countries with comparable population densities. Then they mapped out just how many additional roads they think China will need—and estimated when the convoys of cement trucks will at last slow down.

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