China is ahead of Europe in terms of energy consumption per capita

“China has changed the energy world, but now China is changing,” the International Energy Agency (IEA) said in its flagship World Energy Outlook report for 2023. The world’s second-largest economy has saturated its own market. After years and years of building roads, buildings and other infrastructure as fast as possible, China’s huge domestic market is finally almost tapped.

Yet while China’s economic growth is stabilizing, energy demand is still rising. After decades of breakneck growth, China’s economy is slowing, the nation’s housing bubble is bursting, and unemployment is skyrocketing as record numbers of college students graduate only to face a stagnant job market. But instead of redirecting, Beijing is ramping up manufacturing efforts and leaning on exports to keep the country’s economy humming.

As a result, China’s energy consumption per person has surpassed Europe’s for the first time in history. This eclipse has been a long time coming, as China’s energy consumption has been growing at a rapid pace in recent decades. According to the IEA, China’s energy consumption per person increased by a staggering 489% in the two decades from 2001 to 2021.

While China’s greenhouse gas emissions also increased over the same period, they failed to keep up with energy demand due to China’s unprecedented investment in renewable energy. Since 2000, China’s carbon dioxide emissions have increased by 244%. While that’s still a hell of a lot of carbon, it’s a pretty impressive number with only half the increase in energy consumption.

In fact, China added more renewable energy capacity last year than the rest of the world combined, and renewables now account for half of China’s installed generating capacity. However, due to the size of the country’s economy and the gigantic scale of its industrial sectors, China alone is responsible for as much as 31.72% of global emissions, according to IEA statistics.

So everything China does has serious energy and climate implications for the world. There is no doubt that China’s pro-production policies, which have led to the overproduction of many goods, pose a threat to global climate goals. But to blame Beijing entirely would be at best a gross oversimplification of a complex situation, and at worst a complete scapegoat. As usual, the truth probably lies somewhere in between.

While it is true that China overproduces a number of goods in order to increase export supply rather than to meet existing export demand, this is only a small part of the country’s total production. Most of the production that takes place in China is to meet very real foreign demand, which is crucial to keeping the world economy going. And that takes a lot of energy and produces a lot of carbon.

“We shouldn’t ignore the energy and emissions that Europeans have actually exported to Chinese producers,” Energy Institute CEO Nick Wayth recently told Bloomberg. “If falling energy and emissions in Europe are simply increasing carbon emissions elsewhere, then global climate change policies aren’t working,” the Bloomberg article concluded.

This underlines the importance of looking at climate goals and pathways from a global perspective, rather than focusing on the “successes” and “failures” of individual countries and economies. Achieving the commitments set out in the Paris Agreement will require unprecedented cooperation and coordination from both developing and developed economies, and will require nations to overcome the political temptation to outsource their emissions to poorer countries in order to meet their own, isolated emissions targets. Ultimately, this is a zero-sum game. Without a global approach, everyone loses.

Author: Haley Zaremba for Oilprice.com

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