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Chinese challenge

Chinese challenge

John Kerry, President Biden’s climate envoy, wishes China wouldn’t link climate change to global politics – he says it isn’t a geostrategic issue. China says: oh yes it is

The UK wants to make a success of Cop26 to show it still has convening power after Brexit. The US wants to be the difference between success and failure to show it can still lead after Trump (and because John Kerry, President Biden’s climate envoy, appears genuinely to believe “time is running out” to slow down climate change). China wants to be a part of the process to demonstrate its own leadership credentials and because global warming is turning its hinterland to desert. But it wants to exact a price that has nothing to do with global warming and may be too high to pay. 

Last week Kerry travelled to Tianjin, southeast of Beijing, cap in hand for concessions on the desperately urgent subject of coal before the Cop conference in November. This week Alok Sharma is doing the same for the UK. So far neither has had much luck. 

  • Sharma wants to “consign coal to history” before Cop. China wants to set its own timetable.
  • Kerry wishes China wouldn’t link climate change to global politics – he says it isn’t a geostrategic issue. China says: oh yes it is.

This doesn’t augur well for Cop26 or the Cop process. Without cooperation between the US and China there is almost no chance of success in Glasgow. As Kerry put it in a speech in London in July: “There is simply no way – mathematical or ideological – to solve the climate crisis without the full cooperation and leadership of a country that today leads the world with 28 per cent of global emissions.”

And the chances of that sort of cooperation materialising at this late stage look slim.

Why? China is by far the world’s biggest burner of coal.

Chinese plants produce more than half the planet’s coal-fired power and last year China built more than three times as much new coal-fired capacity as the rest of the world put together. Coal is the most carbon-intensive fossil fuel, so China is an indispensable part of what could be a big win for Cop and the world – a global agreement to phase out coal. Instead, Beijing wants to use coal for (Kerry’s word) geostrategic leverage.

How? It wants the US to stop criticising China on trade, tech and, above all, democracy and human rights. 

Specifically, it wants an end to sanctions imposed by the US because of the crushing of democracy in Hong Kong, and to US support for Taiwan as an independent democracy.

But the US is right to insist its support for democracy in Hong Kong and Taiwan is non-negotiable and separate from the climate crisis. The same goes for its support for Uyghurs in Xinjiang in the face of mass incarceration. This is one reason for the present stalemate. Another is that China has in fact moved on coal and climate and does not want to be seen to cave to American pressure to move further:

  • Even as it continued to approve more coal capacity at home, Beijing shelved or cancelled $47 billion in funding for coal power plants abroad in 2019 and 2020.
  • President Xi claims his pledge to hit Net Zero by 2060 entails decarbonising China’s economy in 30 years (after passing peak coal usage in 2030) – a task that will take the US 45 years and Europe 60.

So why is Kerry continuing to push China to ditch coal and reach Net Zero faster? He says China is such a big polluter that if it doesn’t start cutting coal usage until 2030 the rest of the world will have to hit Net Zero ten years earlier than planned (2040 rather than 2050) to have a chance of limiting warming to 1.5 degrees.

Also, to wield influence at Cop, Team Biden needs to set an example at home. That is bound up in budget and infrastructure bills before Congress worth a combined $4.5 trillion and containing big new funding pledges for clean energy and car charging. Biden wants bipartisan support for both, and won’t get it even from waverers unless he is seen to be tough on China. 

It’s interesting to reflect on what has changed and what has not since President Obama failed to secure a climate deal in Copenhagen in 2009. China has accepted the reality of climate change and started changing policies accordingly. A critical mass of Republican leaders and voters in the US have not. 

Reasons to hope:

  • Kerry and his Beijing counterpart, Xie Zhenhua, have known each other many years and get on well. Personal rapport could still count for something.
  • China’s energy sector worries about reputation because it affects the cost of capital, so pressure to ditch coal is as much domestic and financial as foreign and environmental. 
  • Murdoch’s Australian papers are getting behind Net Zero at last (see below). Could Fox be next?

eco-nomics

Power prices
When overall energy demand is rising, business is often better for fossil fuel energy companies than for renewable ones. When it’s falling, it’s the other way round. Take right now, as Bloomberg’s David Fickling does (£): the price of Newcastle coal (an Australian benchmark) has trebled in a year thanks to rebounding energy demand in India and China after the worst of the pandemic. That’s partly because of simple supply and demand but also because when you need more energy from a coal or other thermal plant all you need to do is push more fuel through it, whereas if you need more from a wind or solar plant you generally need to make it bigger. But – and mercifully there’s a but – wind and solar prices have fallen so far that they’re competitive with thermal at $60 per megawatt hour, and at current prices that is what a coal generator is paying for fuel alone, ie excluding staff, distribution and other overheads. Add in the cost and uncertainty of wild fuel price fluctuations, and the fact that the wind doesn’t always blow is but a trifle. Renewables rule after all. 


Science and Tech

Mix it up
When it comes to storing carbon, not all trees are created equal: over half a century, a Black Cherry can sequester five and a half more tons of CO2 than a Bur Oak. But most reforestation efforts to date have tended to focus on quantity over variety. A side effect is that up to a third of the world’s tree species now face extinction. Monocultures of palm have largely replaced the tropical dipterocarp in Southeast Asia, while Chile’s attempts to subsidise mass tree planting failed to increase carbon storage because of growers’ preference for profitable plantations over native forest. “Forest restoration must be more than tree planting for carbon credits” a new species report by Botanic Gardens Conservation International warns. Too right. Carbon storage matters, but planting schemes should also be scrutinised for their potential to protect diverse ecosystems – rather than reputations.


policy

Oil futures
OPEC+, the group of 23 oil-producing nations, has heeded Biden’s controversial call to boost oil production and keep prices low. Last week a plan to produce an extra 400,000 barrels a day was signed off without a hitch. The only murmur of disquiet came from Iraq’s deputy prime minister, who urged greater support for oil-producing economies transitioning into renewables. A sound plan. But why the sudden change in tone? There’s concern that 2022, even by OPEC’s own analysis, is likely to be rocky for producers. If revenues go into long-term decline, the upshot is more economic instability in resource-rich parts of the Middle East where there’s already plenty of it. Getting poorer, oil-producing nations to diversify is a crucial piece of the Net Zero jigsaw. Will Cop26 carve out the time to talk about it?


Engagement and activism

On reflection…
After years of climate denial and vociferous support for Australia’s coal industry, News Corp Australia is backing Net Zero ahead of Cop 26, the rival Sydney Morning Herald reports. The Murdoch-owned conglomerate publishes several of the country’s most influential papers as well as broadcasting via Sky News Australia. Until now, News Corp’s stance in Australia has been to pressure Canberra to drop emissions-cutting initiatives and deny the influence of climate change on extreme weather events, droughts and bushfires. Commentators have called climate change “a fraudulent and dangerous cult” and a “socialist plot”, but as of October, the group will be supporting a campaign to reach Net Zero by 2050. The about-face comes too late for Murdoch’s youngest son, James, who left News a year ago citing concerns about its support for climate scepticism. But it’s never too late for Fox News in the States, still a  stronghold for deniers, to come around. 

Do share this around, and let us know what you think of it.

Thanks for reading.

Giles Whittell
@GWhittell


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