China’s carbon dioxide emissions are on track for a first annual decline since 2016, a signal that the world’s top polluter’s output of greenhouse gases might have already peaked.
Coal use for power generation plunged last month, while oil consumption contracted in the second quarter as renewable energy output and adoption of electric vehicles increases, reinforcing expectations that the nation’s emissions could contract this year.
A shift in China’s economy away from emissions-intensive sectors, and a tentative retreat regarding fossil fuels, raises the prospect that any decline could be sustained and could mean that carbon pollution topped out last year, well ahead of Chinese President Xi Jinping’s (習近平) 2030 target.
“We are at a moment where clean energy growth is larger than demand growth,” said Bernice Lee, research director at international affairs think tank Chatham House. “If it is true that real estate is no longer seen as the engine for growth, then it is likely you could see emissions projections going down.”
A long-term decline in China’s emissions — which added more than 11 billion tonnes of carbon dioxide to the atmosphere in 2022 — would need authorities to resist turning to heavy industry to spur sluggish economic growth, and require new solutions for grid constraints that threaten to hamper clean energy.
China accounted for more than 30 percent of the world’s emissions in 2022 and has for years driven the increase in the global total, meaning an early peak would ease the conditions for nations to succeed in limiting planetary warming.
Annual emissions in China are forecast to fall through 2050 and decline either 7.2 percent or 8.2 percent this year, researcher BloombergNEF said in its latest New Energy Outlook report, which modeled two global climate pathways.
Coal-fired electricity generation last month slumped for a second straight month and declined 7.4 percent, the biggest drop since May 2022 when Shanghai was in a COVID-19 lockdown, data released on Monday by the Chinese National Bureau of Statistics showed.
Oil demand in China slipped into a marginal contraction in the second quarter as weaker growth has dented consumption of transport and industrial fuels, the International Energy Agency said earlier this month.
Record installations of solar panels and wind turbines mean renewable energy generation is surging, and helping to reduce reliance on more polluting sources even as power demand rises.
If China’s rapid deployment of solar and wind continues, the country’s carbon emissions are “likely to continue falling, making 2023 the peak year,” Asia Society Policy Institute senior fellow Lauri Myllyvirta said in a report last week.
China’s economy is also undertaking a structural shift amid a years-long deflation of the real-estate sector. That is resulting in lower output of materials such as cement and steel, the two largest carbon-emitting activities outside of power.
Yet the trajectory for China’s emissions would depend on the government’s response to a slowing pace of growth, and whether it continues to pursue Xi’s long-term objective of prioritizing higher-tech industries.
“They could just say there’s another stimulus again,” Lee said.
Authorities would also have to reconfigure China’s electricity system to address grid limitations that mean a small, but rising volume of wind and solar power is going to waste. About 3.3 percent of solar generation was curtailed this year through May, compared with 2 percent in the same period last year. Wind curtailment rose from 3.4 percent to 4.1 percent.
“There are real constraints that likely will eventually lead to rising problems integrating wind and solar,” Oxford Institute of Energy Studies senior research fellow Anders Hove said.
China is investing in new power lines and energy storage systems, and considering additional market-based reforms to ensure that clean electricity generation is used efficiently.
Even if the nation’s emissions have peaked, the volume remains so large that it would be the pace of the decline that is critical to the world’s prospects of hitting net zero targets.
Xi has pledged that China is to achieve carbon neutrality before 2060.
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