All eyes on China as climate summit approaches

GUANGZHOU, China — Ahead of the historic climate meeting beginning later this month in Paris, all eyes are on how China — the world’s largest carbon polluter — will navigate global negotiations to cap carbon and help curb catastrophic global warming. 

With new official data released this week revealing that China is burning significantly more coal than it had previously disclosed, some question the potential for success of any global pact to come out of Paris. But those familiar with China’s environmental situation say the country’s release of new figures is not all bad news. In fact, some analysts believe the release of the data — as stark as it is — may actually be an unprecedented step by China toward transparency. And, they believe, the data release reflects rising economic and social pressure within China to finally work toward mitigating further damage to the planet.

“The good news is China is not hiding from this. They’re working hard to improve the ability to monitor coal use and carbon pollution, so that’s where these figures are coming from,” said Barbara Finamore, a senior attorney and Asia director at the Natural Resources Defense Council. Previously, the country was “opposed to any effort to develop a transparent system of monitoring, reporting and verifying emissions” that would be reported internationally. 

The new figures, released by the Chinese government Wednesday and first reported in the New York Times, show that China has been burning up to 17 percent more coal than previously reported. 

China’s commitment in Paris to addressing climate change would constitute a turning point for both the country and the globe. After more than 20 years of negotiations, the United Nations hopes to reach the first legally binding universal agreement on climate. The annual Conference of Parties, this year known as COP21, will be an attempt to gather commitments that can keep the planet’s climate from warming more than two degrees Celsius. As the world’s second largest economy and the biggest emitter of greenhouse gases, China’s actions will set a tone for other industrializing countries and are even challenging the skepticism of climate change doubters in the United States.

In the past, the international community prodded China to begrudgingly address its greenhouse gas emissions. Mitigating climate change took a backseat to the country’s development and industrialization. China criticized the United States for having a longer history of leading the world in carbon emissions and the two countries pointed fingers at each other, playing the blame game to avoid taking unilateral action to combat climate change. 

Now policy makers, environmentalists and economists say they are witnessing a significant change: For China’s leadership, climate change is now a priority linked to the country’s economic growth and political stability. 

“I think this is a pivotal moment for the both China and the US and the world to show leadership in the run up to the Paris negotiations late this year,” said Finamore. “I think China’s very serious about taking action on climate change.”

Getting real

The push for accountability was echoed earlier this week, when Chinese President Xi Jinping and French President Francois Hollande announced the need for a legally binding agreement in Paris that includes mechanisms to monitor countries’ progress in meeting their emissions goals.

The move is in stark contrast with China’s stance during 2009 climate talks in Copenhagen, when the country opposed a legally binding agreement or any effort to develop a transparent system of monitoring, reporting and verifying emissions. And combined with a growing awareness that China is among the most vulnerable to devastation from climate change, it shows that China is committed to action. 

“There are two important sides of the China coal story these days,” said Shuo Li, senior climate and energy policy officer for Greenpeace East Asia, in an email. One is that the absolute coal consumption was more than previously reported. The other, he said, is that for the first time ever, China has reduced its annual coal output. “Both stories are true. The former tells you the past, the latter shows the future,” said Li. 

Li wasn’t surprised by the new data — Greenpeace and others have said for years that China has been underreporting coal consumption. However, last year was the first year in more than a decade that the country’s carbon dioxide emissions dropped.

In June, China released its carbon reduction pledge, or Intended Nationally-Determined Contribution, for COP21. China’s proposal promises to peak the country’s carbon emissions by 2030 or earlier, and at the same time increase its use of non-fossil fuels to 20 percent of the country’s primary energy consumption.

The pledge largely reiterates agreements China made with the US last year when the two countries’ presidents came to a landmark decision to combat global warming. The promise of the world’s biggest carbon emitters working together led to international optimism on climate change negotiations. Aside from agreeing to peak carbon emissions by 2030, the two governments planned to work together to limit greenhouse gas emissions through the creation of US-China Climate Change Working Group.

While US-China relations are fraught with tensions stemming from accusations of cyber espionage, China’s recent currency devaluation and its territorial claims in the South China Sea, combatting climate change seems to be one of the only areas where the two countries have managed to find agreement. 

During his first State Visit to Washington in September, Chinese President Xi Jinping demonstrated his commitment by announcing his plans to launch the world’s largest carbon trading system by 2017. A cap-and-trade system aims to reduce carbon emissions and incentivize sustainability by setting a ‘cap’ on the amount of pollutants that a company is allowed to produce in a given amount of time. Under this kind of system, companies that emit less than the ‘cap’ can then sell or ‘trade’ their excess carbon credits. 

China has been testing a cap-and-trade system since 2011 in a pilot program spanning seven municipalities and provinces, including Beijing, Shanghai and Guangzhou.

Along with the carbon trading system, China also announced that it would give $3.1 billion in aid to help developing countries cut down emissions and adapt to the world’s changing climate. That’s more than the $3 billion President Obama promised to the United Nations Green Climate Fund last year, a pledge that may never materialize as Republicans skeptical of climate change attempt to block the president’s spending request in Congress. 

“The Chinese money reflects how they perceive themselves in the international climate politics. That it’s larger than the US commitment tells you where [China] positions itself in the whole dynamic,” said Li with Greenpeace. “It’s a paradigm shift, something I cannot imagine happening 35 years ago.”

China’s new commitment comes as the country is reaching a turning point in its decades-long model of export- and investment-led growth, a shift that also carries implications for the environment. After nearly 30 years of seeing its economy grow by more than ten percent each year, China is struggling just to meet its official target of seven percent GDP growth. The country couldn’t grow at breakneck speed forever and to avoid staying stagnant as a middle-income country, China must now attempt to pivot its economy away from unsustainable, resource-intensive industry and towards an economy that is more reliant on consumer services and uses less fossil fuels. 

“China’s been a major driver in demand for energy and minerals,” said David Dollar, Senior Fellow at the Brookings Institute and former US Treasury emissary to China. But, he said, “That phase of over-investment is naturally coming to an end. The economy is slowing down and that by itself would effect energy use and carbon emissions.” 

“The older economic model is very carbon intensive, with dire environmental consequences, “ said Fred Hu, formerly a partner, managing director and Chairman of Greater China at Goldman Sachs and now a founder of Primavera Capital Group, based in Beijing and Hong Kong. “It’s no longer viable or sustainable. Therefore China has no choice than to take drastic action. The stakes are high.”

What’s at stake for Chinese leadership is the extraordinary economic development the country has achieved since opening up its markets, as well as the risk of political instability as China’s citizenry are increasingly exposed to the effects of air pollution and climate change.      

Rising waters

The famed White Swan Hotel in Guangzhou, which reopened its doors this summer after three years of renovation, stands as a testament to China’s ascent into an increasingly powerful and affluent international player. The hotel sits on Shamian Island, a sandbank on the Pearl River, and hugs the water’s edge. 

Just across a footbridge from the island is the well-known Qing Ping Chinese Medicine Market. For years, the medicine vendors have suffered losses from flooding, an affliction that was finally alleviated when local authorities installed an updated drainage system last year. 

In the future, however, drainage pipes and sea walls may not be enough to protect Guangzhou. The waters of the Pearl River rise each year — a quiet but looming threat to the city’s people and economy. 

Guangzhou is the capital of Guangdong Province, a manufacturing hub sometimes called “the world’s factory.” The city has the third largest GDP in China after Shanghai and Beijing. 

The OECD and World Bank also ranked Guangzhou #1 in a 2013 study of the cities most at risk from rising sea levels associated with climate change. Of the 20 coastal cities expected to face the most damage as a percentage of their overall GDP — five are in China.

China has the biggest flood loss potential for industrial parks with estimates suggesting 52% at risk of river flooding and 25% threatened by storm surge, according to insurance company Allianz Global Corporate & Specialty. The company released a report this year describing the increased risk of storm losses in Asia’s coastal megacities. “The Pearl River Delta alone has higher loss potential than all of Thailand, which in 2011 experienced the largest flood loss in history – costing approximately $50 billion in economic damages and over $16 billion in insured losses,” said Allianz Asia CEO Mark Mitchell in an email.

In a worst-case scenario, sea level rise and flooding could cause mass evacuations in coastal cities. Guangdong also happens to be China’s most popular destination for immigration. More than 20 million migrants, mostly seeking work in industrial factories, have flocked to the city to in the past five years alone. 

By 2070, Guangzhou is estimated to have 10.3 million people and $3.5 trillion in assets at risk from climate change. Shanghai is also at risk as all that stands between the city and the sea is 13 feet of land. The sea level there is rising as soil weak from endless construction and pumping of groundwater is subsiding. And a study by the Texas A&M and Yale Universities found that by 2030 the amount of developed low-elevation coastal land in China will have increased by over 60,000 square kilometers since 2000. 

“It’s actually good economics to take steps to mitigate climate change,” said Dollar. “A good way to think about it is in terms of insurance. If you look at some of the more dire scenarios, they’re extraordinarily costly,” he said, referring to the recent rise of sea levels and other extreme weather events like typhoons and heavy rainfalls (link to Taiwan story).  He added; “Are you willing to pay one percent of your income to insure yourself against these terrible events? Yeah, that’s a really good deal.”

Business aside, members of China’s burgeoning middle class have become more worried about the environment and what the government is doing to protect or potentially endanger its people. After all, even Beijing’s elite have to breathe the suffocating pollution in the air. Since most of the pollutants in China’s air are greenhouse gasses, there is a strong connection between air quality and climate change in the region.

“The government is really under pressure to reduce air pollution. This is a very strong motivation. There are environmental concerns that have become social concerns. People more and more are complaining a lot about the bad air quality,” said Dr. Tao Hu, an ecologist and environmental economist with the World Wildlife Foundation who worked for nearly twenty years in China’s Ministry of Environmental Protection. 

Environmental activism has snowballed into a formidable movement in China as people have become more aware of the costs of relentless industrial growth and as social media makes it easier for concerned citizens to connect with one another.

Even Greenpeace activists have been able to gain a foothold in the communist-led country. Shuo Li said his NGO has had constructive engagement with the Chinese government on climate. The organization has offices in Hong Kong, Beijing and Taipei. 

The strength of civil society in this arena has been aided by China’s involvement in international climate dialogues. “We are playing in two soccer fields,” said Li — one in China and one on a global scale. “Once the team plays on the international field it may also carry some lessons back home.”

From herders in China’s Tibetan plateau whose flocks are dying because of thinning grasslands, to urban elites with coastline property vulnerable to flooding, every sector of China’s society has something to lose if the planet’s steadily warming temperatures continue unabated. 

All of this adds to the internal pressures that have led China’s Communist Party to take action. 

“China’s going to be a big loser,” from its own greenhouse gas emissions, said David Dollar with Brookings. And so even before the much-anticipated climate conference in Paris that will take place at the end of this year, when it comes to tackling the threat of climate change, said Dollar, “I think they have enough internal motivation to do it on their own.”

Local environmental advocacy groups hope that China’s goals will set a precedent for other governments as well. Under ‘the one country, two systems’ agreement, Hong Kong is not required to follow mainland China’s carbon policies. But said, Jeffrey Hung with Friends of the Earth Hong Kong, “Why can China do that, but Hong Kong can’t? We hope Hong Kong will follow.”

Both Hong Kong and Macau are vulnerable from coastline erosion and sea level rise.

Still, environmentalists warn that it will take more than China to keep the world safe. The two-degree ceiling to be agreed upon in Paris is what scientists believe can prevent the potentially catastrophic toll of climate change on humanity.

Is the international community on track to meet the two-degree goal? 

“We are not. That’s very clear,” said Shuo Li with Greenpeace. “I don’t think China can singlehandedly keep us below the two-degree target. It requires a global effort.”

This story is Part 1 of a reporting series produced in a partnership between The GroundTruth Project and The University of Hong Kong’s Journalism and Media Studies Centre. Read more from this series, Beijing Haze