Wed, Jul 12, 2006 - Page 4 News List

IEA says China should be more energy-efficient

WASTED ENERGY China's artificially low electricity prices and poor efficiency are leading to rising coal consumption and with it, higher levels of pollution

NY TIMES NEWS SERVICE , HONG KONG

The International Energy Agency (IEA) called on Monday for China to revamp its electric power industry, noting that waste and inefficiency contributed to the need for the country to add new, mostly coal-fired, power plants every two years -- equal to the entire electricity generation capacity of France or Canada.

In a report issued at its headquarters in Paris, the IEA was especially critical of China's decision to limit increases in electricity prices, saying that this prompted Chinese consumers and industries to use considerably more energy than they needed.

Faced with an overheating economy in 2004, the Chinese government decided to allow few price increases for power companies even though global energy prices were rising.

Beijing officials have largely followed that policy ever since, including a slight increase on June 30, even as world oil prices have soared past US$70 a barrel and coal and natural gas prices have also climbed.

"Energy efficiency is not good in China because prices are too low," the IEA's executive director, Claude Mandil, said.

The report also urged China to set minimum efficiency standards for coal-fired power plants and to enforce air pollution standards more rigorously for these power plants.

Coal fuels two-thirds of China's electricity production, and China is now the world's second-largest electricity consumer, trailing only the US.

China's heavy reliance on coal has prompted particular concern because the burning of coal releases more carbon dioxide, relative to the electricity produced, than oil, natural gas, nuclear power, or renewable energy sources like wind power.

Carbon dioxide is a major contributor to global warming.

Improving efficiency and reducing waste will allow China to somewhat slow its growth in emissions of carbon dioxide and toxic air pollutants like sulfur dioxide, by making it possible for China to burn less coal, said Jonathan Sinton, the energy agency's senior China specialist.

China's coal consumption and carbon dioxide emissions would still double by 2030 even with power plant efficiency gains and less waste, but would triple without these changes, the IEA study estimated.

Chinese power companies are looking for ways to improve efficiency while reducing pollution, said Liu Deyou, chief engineer at the Beijing SPC Environment Protection Tech Engineering Co, the sulfur-filter manufacturing arm of one of the five big, state-owned electric utilities.

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