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27 comments on Is this the Economic stage of the Peak?

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Jack on November 22, 2005 - 8:06am Permalink | Subthread | Parent | Comments top
It is more compex than that. The Chinese, like most countries, have some programs in place to reduce energy demand. However, they subsidize gasoline at the retail level, which is a massive incentive to use more. I think it would be inaccurate to say that the Chinese are doing much at a system level to reduce their dependence on oil.
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Twilight on November 22, 2005 - 8:44am Permalink | Subthread | Parent | Comments top
Thanks for the feedback - I've been wanting to investigate that further.  I suppose it would be more instructive to look at actual Chinese energy use compared to, say growth in their GDP, and see what the results are.
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TI on November 22, 2005 - 3:41pm Permalink | Subthread | Parent | Comments top
Domestic coal is the main energy source in China - over 70%. Oil makes most of the rest and half of it is produced home and the other half is imported. So the share of oil in the Chinese energy mix is lower than the world or US average. China is very self-sufficient in energy - 94%. And of course the oil use per capita is very low.

We could say that China has succeeded at least somewhat to curb oil consumption. But it is developing rapidly and this is more difficult than before. Even if China keeps the share of oil in its energy mix constant, a 10+ % economic growth means that the oil consumption rises. China has little domestic natural gas, so there are not many choices. The Chinese oil consumption has grown roughly at the same pace as GDP. Now, if Chinese domestic oil production (3.4 mbpd 2004) starts to decline this means increasing market demand and a decreasing supply.

More, the all important Chinese coal production growth seems to be slowing down somewhat from the present (10%) level. This would increase import demand, also for oil.

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Leanan on November 22, 2005 - 4:27pm Permalink | Subthread | Parent | Comments top
Yup.  In July of 2004, there was an article in Discover magazine about China's attempts to clean up their environment. Their country is being decimated by pollution. Sulfuric acid generated by their coal-burning plants (which provide 75% of their energy) is killing their crops. Deforestation and erosion is causing huge dust storms. They want China to be greener (especially for the Olympics).

The article said that they plan to quadruple the size of their economy by 2020, while "only" doubling their use of coal. The article talked about solar and wind, but I have to think that oil is also a big part of their plans. No way can solar or wind provide that much energy.

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TI on November 23, 2005 - 3:48am Permalink | Subthread | Parent | Comments top
"The article said that they plan to quadruple the size of their economy by 2020, while "only" doubling their use of coal." This would mean that should produce about 4 billion tons of coal or 4 times the US current production. This is not possible. In fact the Chinese coal industry is predicting a far lower growth of coal production during the next few years.

China needs a lot more oil, that's for sure.

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