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China has reached peak coal, and it’s a global turning point

China’s coal use peaked in 2013-14 and is now set to decline, a peer-reviewed commentary piece published in Nature Geoscience has argued.

Currently the world’s largest consumer of coal – accounting for 50 per cent of world demand – structural shifts away from heavy industry, a growing air pollution crisis and huge investment in renewables has seen China’s use of coal peak much earlier than expected, Tsinghua University’s Tony Wu and colleagues said.

It’s an important announcement because it indicates peak coal could also soon hit globally, the authors said.

“As the world’s largest emitter of greenhouse gases, a peak in China’s coal consumption is not only a necessary condition for a global peak, but may well be an important milestone in the Anthropocene and a turning point in international efforts to mitigate the emissions of climate-altering greenhouse gases.”

The call of peak Chinese coal is a controversial one because most estimates have placed the peak somewhere between 2020-2040.

However, the authors said there was strong evidence to show it had already occurred.

Coal use dropped from 4.24 billion tonnes in 2013 to 4.12 billion tonnes – a 2.9 per cent decrease, they said. And in 2015 it dropped a further 3.6 per cent.

This all happened while GDP increased by 7.3 per cent and 6.9 per cent, respectively, which the authors said showed that economic growth had decoupled from coal consumption.

“The decoupling of growth in the economy and growth in coal use has raised the important question of whether this is just a temporary dip, or a turning point that indicates that peak coal consumption has already arrived,” the authors said.

“We argue that China’s coal consumption has indeed reached an inflection point much sooner than expected, and will decline henceforth – even though coal will remain the primary source of energy for the coming decades. We suggest that China has entered the era of post-coal growth.”

The authors said there had been a “fundamental shift” in the Chinese economy’s relationship with coal, which had largely gone unnoticed until the recent peak in consumption.

“Even before the 2013 peak, the growth of coal consumption had been much slower than that of the economy, indicating rising efficiency.”

The commentary says two forces are behind the shift.

First, an ongoing economic slowdown, particularly in the construction and manufacturing sectors, which had accounted for 80 per cent of coal combustion between 2011-2015.

“Through 2015, coal use in thermoelectric power, iron and steel, and cement production decreased by 6.2 per cent, 3.2 per cent and 8.2 per cent, respectively: this has significantly lowered national demand for energy.”

With the decline of these sectors has been the rise of the service industry, which has much lower energy intensity.

Second has been strengthened policies around air pollution and clean energy.

“Over the past decade, China has faced increasing pressure to reduce air pollution and mitigate global climate change,” the authors said.

Lowering coal use has been integral to goals of decreasing of sulphur dioxide, nitrogen oxides, ammonia and carbon intensity.

“At the same time, there has been a rapid growth of solar, wind, nuclear and hydropower generation.”

The authors argue these trends are here for the long-term, with the consumption peak not just a temporary dip due to economic fluctuations.

The economic downturn in construction and manufacturing are long-term trends that characterise a new phase of economic development for China, they said.

“The period of slower economic growth is here to stay, and so is the correlative softening of energy demand.”

Similarly, the policies around air pollution and clean energy are part of long-term strategies.

“For the government, curbing air pollution is an important aspect of maintaining political legitimacy.”

The authors also argue that China knows technological innovation in energy, communications and manufacturing is a priority for long-term economic growth.

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