Authors: Laura Cozzi and Tim Gould*
Every year, the World Energy Outlook scenarios are updated to take into account the latest data and developments in policies, technology, costs and science. The major new scientific element for this year’s WEO was without doubt the Special Report on Global Warming of 1.5 °C, which the Intergovernmental Panel on Climate Change (IPCC) published in late 2018.
The IPCC report contains a wealth of new information about the risks of global warming, underlining that many of the physical impacts of climate change escalate in a non-linear fashion in relation to increases in global temperature. In other words, the impacts of 2.0 °C of warming are far worse than those of 1.5 °C.
The energy sector is at the front line of this issue, as it is by far the largest source of the emissions that cause global warming. As a result, this year’s WEO explores in detail what a pathway consistent with capping the temperature rise at 1.5 °C would mean for the energy sector. The discussion goes to the heart of energy’s dual role in modern civilisation: it’s essential to all the comforts of modern life – our homes, workplaces, leisure and our infrastructure – but the way it’s largely produced and consumed at the moment damages the environment on which we all depend.
Although the task of tackling climate change is huge, it is relatively simple to define. Global emissions need to peak as soon as possible and then fall rapidly until they hit zero – or, as the Paris Agreement puts it, until there is a “balance between anthropogenic emissions by sources and removals by sinks,” a situation sometimes called net-zero.
It’s not the only variable that counts, but the year at which global emissions reach net-zero is a critically important indicator for the prospects of stabilising global temperatures. The Paris Agreement specifies that this needs to happen “in the second half of this century.” The IPCC’s 1.5 °C report underlines that there is a major difference between reaching net-zero in 2100 versus 2050, and attention in many countries is increasingly focused on earlier dates.
After the UN Climate Summit in September, at least 65 jurisdictions, including the European Union, had set or were actively considering long-term net-zero carbon targets, including efforts to reach net-zero in 2050 or sooner. These economies together accounted for 21% of global gross domestic product and nearly 13% of energy-related CO2 emissions in 2018.
The Sustainable Development Scenario
The Sustainable Development Scenario relies on all of these net-zero targets being achieved on schedule and in full. The technology learning and policy momentum that they generate means that they become the leading edge of a much broader worldwide effort, bringing global energy-related CO2 emissions down sharply to less than 10 billion tonnes by 2050, on track for global net-zero by 2070.
There are no single or simple solutions to achieve this result. Rapid energy transitions of the sort envisaged by the Sustainable Development Scenario would require action across all sectors, utilising a wide range of energy technologies and policies. Energy efficiency improvements and massive investment in renewables – led by solar PV – take the lead, but there are also prominent roles in this scenario for carbon capture, utilisation and storage (CCUS), hydrogen, nuclear and others.
Among the range of technology solutions proposed for global emissions, there is one category that is used only very sparingly. These are the so-called negative emissions technologies, which actually remove CO2 from the atmosphere. Examples are bioenergy used in conjunction with CCUS (often called “BECCS”) and direct air capture. These technologies may yet play a critical role, but the level at which they are deployed in the Sustainable Development Scenario (0.25 billion tonnes in 2050) is lower than nearly all of the 1.5 °C scenarios assessed by the IPCC.
The Sustainable Development Scenario and the pursuit of 1.5 °C
If emissions were to stay flat, at the net-zero level, from 2070 until the end of the century, then the Sustainable Development Scenario is “likely” (with 66% probability) to limit the rise in the average global temperature to 1.8 °C, which is broadly equivalent to a 50% probability of a stabilisation at 1.65 °C.
If negative emissions technologies of the sort mentioned above could be deployed at scale, then emissions could actually go below zero – meaning that carbon dioxide is being withdrawn from the atmosphere on a net basis. This is a very common feature of the scenarios assessed by the IPCC in its special report: 88 out of the 90 scenarios in the IPCC’s report assume some level of net negative emissions.
A level of net negative emissions significantly smaller than that used in most scenarios assessed by the IPCC would give the Sustainable Development Scenario a 50% probability of limiting the rise in global temperatures to 1.5 °C.
It is technically conceivable that the world will reach a point where large quantities of CO2 are absorbed from the atmosphere, but there are uncertainties about what may be possible and about the likely impacts. As we have pointed out in previous WEOs, when designing deep decarbonisation scenarios, there are reasons to limit reliance on early-stage technologies for which future rates of deployment are highly uncertain.
That is why the WEO has always emphasised the importance of early policy action: the pathway followed by the Sustainable Development Scenario relies on an immediate and rapid acceleration in energy transitions.
With the same precautionary reasoning in mind, the WEO-2019 also explores what it would take to achieve a 50% probability of stabilisation at 1.5 °C without net negative emissions.
A 1.5 °C scenario that does not rely on negative emissions technologies implies achieving global net-zero emissions around 2050. This in turn means a reduction in emissions of around 1.3 billion tonnes CO2 every year from 2018 onwards. That amount is roughly equivalent to the emissions from 15% of the world’s coal fleet or from 40% of today’s global passenger car fleet.
The year by which different economies would need to hit net-zero in such a scenario would vary, but the implication for advanced economies is that they would need to reach this point in the 2040s. The difference, compared with the Sustainable Development Scenario, would be much starker for many developing economies, which would all need to be at net-zero by 2050.
A zero-carbon power system would need to become a reality at least a few years before the entire economy reaches net-zero. This implies moving to a zero-emissions electricity system in the 2030s for advanced economies and around 2040 for developing economies.
Discussing target dates in this context is useful, but the really tough part is working out how to get there. That requires credible plans to actually reduce emissions quickly across the entire economy, pathways that work not just from the perspectives of technical feasibility or cost-efficiency (although these are important) but also take into account the need for social acceptance and buy-in.
The technical solutions in the power sector, at least, are well known, although the scale and speed at which clean energy technologies would need to be deployed – and existing facilities either repurposed, retrofitted with CCUS, or retired – is breath-taking. But any economy-wide net-zero target also needs to find answers quickly for sectors that are much harder to decarbonise, notably buildings, heavy industries like cement and steel, aviation and freight transport. Achieving such an outcome, without compromising the affordability or reliability of energy, represents an extraordinary challenge.
The energy sector is rightly at the heart of the climate debate, but it cannot deliver such a transformation on its own. Change on a massive scale would be necessary across a very broad front. As the IPCC 1.5 °C report says, this type of scenario would require rapid and far-reaching transitions not only in energy, but also in land, urban infrastructure – including transport and buildings – and industrial systems.
In its 2019 edition, the World Energy Outlook once again puts the spotlight on the huge disparity between the kind of transformation that is required and the pathway that the world is on, according to our assessment of today’s policy plans and ambitions and the rising energy needs of a growing global population and economy.
As the IEA’s Executive Director, Dr Fatih Birol, commented at the WEO launch this week, the world urgently needs to put a laser-like focus on bringing down global emissions.
“This calls for a grand coalition encompassing governments, investors, companies and everyone else who is committed to tackling climate change,” Dr Birol said. “Our Sustainable Development Scenario is tailor-made to help guide the members of such a coalition in their efforts to address the massive climate challenge that faces us all.”
*Tim Gould, Head of Division for Energy Supply Outlooks and Investment.
Diverse notions of Energy Security in a Multi-polar World
The concept of energy security has been at the front and centre of many important changes in international relations and international law since the 1970s. However, in the recent past, the speed of its evolution and the fleshing out of its scope and content has been quite dramatic. During this period, there has been remarkable flux in the patterns of global trading in energy products. In 2008–09, several key trends started to develop in the energy sector, triggered by the influence of two new, very strong factors: the global financial and economic crisis and the shale revolution in gas and oil production. The Energy Policy of the Trump Administration stands in contrast with that of the Obama Administration. The America First Energy Plan stated, inter alia, that “The Trump Administration is committed to energy policies that lower costs for hardworking Americans and maximize the use of American resources, freeing us from dependence on foreign oil.” The Plan called for removing the Climate Action Plan and the Waters of the US rule, embracing the shale oil and gas revolution, commitment to clean coal technology, and to reviving America’s coal industry, boosting domestic energy production, achieving energy independence from the OPEC cartel and any nations hostile to US interests, and responsible stewardship of the environment. Two years later, a White House Fact sheet stated that under President Trump, the US had been establishing energy dominance, abolishing the war on energy and advancing American energy. Specifically, it was pointed out that United States had become, amongst others, (a) the largest crude oil producer in the world, (b) a net natural gas exporter for the first time since 1957 including exports of LNG to the EU at an all-time high in March 2019 , (c) crude oil exports nearly doubled in 2018, reaching a record average of 2 million barrels a day, (d) coal exports reached their highest level in five years in 2018 and (e) withdrew from the Paris Climate Agreement and got “rid of costly Obama-era regulations like the Stream Protection Rule and the Clean Power Plan.” The George W Bush legacy was closer to the Obama approach. According to a Fact sheet on the same, President Bush had taken a reasoned, balanced approach to the serious challenges of energy security and climate change.
According to its White Paper of 2012 titled, “China’s Energy Policy” in 2011, the output of primary energy equaled 3.18 billion tons of standard coal, ranking first in the world. At present, nearly 50 percent of China’s total energy imports is from the Middle East. For the foreseeable future security of energy supplies will continue to remain a policy priority for Beijing. Under Xi Jinping, China has turned more ambitious in respect of its energy mix with considerable emphasis on new energy including through the Made in China 2025 policy and the Belt and Road connectivity initiative. It may be recalled that the ten year Made in China 2025 plan on promoting manufacturing was announced in May 2015 and specifically included energy saving cars and new energy cars among the ten key sectors. According to a MERICS Database made public in July 2019, two thirds of Chinese spending on completed BRI projects went into the energy sector, and already amounted to more than USD 50 billion. Renewable energy power-plants led the pack of completed, Chinese-funded energy projects with a total investment volume in excess of USD 20 billion. According to the 2019 Annual Report of the US-China Economic and Security Review Commission, China has quickly built up advanced production capacity in lithium-ion batteries and established control over a substantial portion of the global supply chain, exposing the United States to potential shortages in critical materials, battery components, and batteries. Further, China is positioning itself to become a leader in nuclear power through cultivating future nuclear export markets along the Belt and Road, particularly in sub-Saharan Africa, and attracting advanced nuclear reactor designers to build prototypes in China. Finally, reference may also be made to China’s efforts at the Arctic region. Since 1999, China has organized a number of scientific expeditions in the Arctic, with its research vessel Xue Long (Snow Dragon) as the platform. In 2004, it built the Arctic Yellow River Station in Ny Alesund in the Spitsbergen Archipelago and by the end of 2017, China had carried out eight scientific expeditions in the Arctic Ocean, and conducted research for 14 years with the Yellow River Station as the base.
The position of the OPEC has also evolved. In a keynote address delivered by HE Abdalla Salem El-Badri, OPEC Secretary General, at the Chatham House Conference entitled “Middle East Energy 2008″ – Risk and Responsibility: The New Realities of Energy Supply – London, UK, 4 February 2008, he focused on the following characteristics: Energy security should be reciprocal; universal, applying to rich and poor nations alike; focus on providing all consumers with modern energy services; apply to the entire supply chain; cover all foreseeable time-horizons; allow for the development and deployment of new technologies in a sustainable, economic and environmentally-sound manner; and benefit from enhanced dialogue and cooperation among stakeholders. A decade later, it is instructive to glance through the World Oil Outlook report 2019 launched on 5 November 2019 at Vienna, Austria. It states, inter alia, that demand for OPEC liquids is projected to increase to around 44.4 mb/d in 2040, up from 36.6 mb/d in 2018; global crude oil and condensate trade is estimated to remain relatively static at around 38 mb/d between 2018 and 2025, before increasing to around 42 mb/d by 2040; in the period to 2040, the required global oil sector investment is estimated at $10.6 trillion; and energy poverty remains a major global challenge, with almost one billion people still without access to electricity and three billion lacking access to clean fuels for cooking. The Aramco’s IPO is being watched with interest including for what it meant for energy security calculations especially of the Kingdom of Saudi Arabia. The testy relationship between the US analysts and the OPEC markets remains even as the promise of shale gas fades away.
The Indian understanding of energy security encompasses four aspects, namely (i) availability of energy for all citizens, (ii) lifeline energy, (iii) supply that meets effective demand, and (iv) ability to withstand shocks and disruptions. The landmark India-US nuclear deal was intended to address the problem of energy deficit that had emerged as one of the primary constraints on accelerating India’s growth rate. According to a fact sheet of the Ministry of External Affairs of India of 27 June 2007, “Presently, only 3% of India’s energy needs are met from the nuclear sources. India plans to produce 20,000 MWe from the nuclear sector by 2020, an increase from the current 3,700 Mwe.” Full civil nuclear energy cooperation with the US was also expected to help India achieve energy security. Most recently, in his speech at 16th International Energy Forum Ministerial Meeting in New Delhi in early 2019, Indian Prime Minister Narendra Modi said, “Given global uncertainties, India also needs energy security. My vision for India’s energy future has 4 pillars– energy access, energy efficiency, energy sustainability and energy security….the launch of the International Solar Alliance is a step towards fulfilling this commitment.” India had reaffirmed its commitment to the Paris Agreement and achieved some successes through its citizen participation on certain aspects of the fight against pollution. Recent news reports indicate that the Government of India is in the process of formulating a new energy policy. The highly reputed National Geographic assessed in September 2019 that “India has emerged as a global leader in renewable energy, and in fact it is investing more in them than it is in fossil fuels”
The IEA defines energy security as the uninterrupted availability of energy sources at an affordable price. At the mid 2019 G20 Osaka Summit, the leaders acknowledged “…the importance of global energy security as one of the guiding principles for the transformation of energy systems, including resilience, safety and development of infrastructure and undisrupted flow of energy from various sources, suppliers, and routes.” They also recognized the value of international cooperation on a wide range of energy-related issues including energy access, affordability and energy efficiency, and energy storage. The WTO has in a limited way addressed some aspects of energy security. In the WTO Panel report of September 2018 on European Union and its Member States — Certain Measures Relating to the Energy Sector, where the complainant was the Russian Federation, one of the points of contention was regarding the third-country certification measure in the national implementing laws of Croatia, Hungary and Lithuania. Both parties agreed that the measure, de jure, violates the national treatment obligation in Article XVII of the GATS by requiring a security of energy supply assessment prior to the certification of third-country transmission system operators, but not domestic ones. Controlling the South China Sea has major implications for energy security in that region. The strategic context affecting upstream development in the South China Sea is a rising China that is increasingly able and willing to assertively pursue its perceived sovereign rights to oil and gas resources. The decision of the Permanent Court of Arbitration in the case brought by The Philippines has relevance in this regard. The centrality of ASEAN countries in the 21st century Maritime Silk Road initiative of China is testimony to this. How the regional grouping handles the on-going negotiations on the Code of Conduct for the SCS is going to determine the safety of sea lanes in this busy and sensitive area. The imperative for energy security in such a vulnerable strategic region as the Asia-Pacific is paramount for global stability and development. In this regard, the 2007 non-binding Declaration on East Asian energy security signed by the leaders of the member countries of the Association of Southeast Asian Nations (ASEAN), Australia, People’s Republic of China, Republic of India, Japan, Republic of Korea and New Zealand, on the occasion of the Second East Asia Summit on 15 January 2007 in Cebu, Philippines called for: cleaner and lower emissions technologies, use of biofuels, improving efficiency and conservation, reducing the costs of renewable and alternate energy sources through innovative financing schemes, intensifying the search for new and renewable energy resources and technologies, stable energy supply through investments in regional energy infrastructure, recycling of oil revenues and profits for equity investments, strategic fuel stockpiling, clean use of coal and development of clean coal technologies and international environmental cooperation, regional or bilateral cooperation & assisting less developed countries in enhancing national capacity building.
In 2017, the EU produced around 45 % of its own energy, while 55 % was imported; the energy mix in the EU, was mainly made up by five different sources: petroleum products (including crude oil) (36%), natural gas (23%), solid fossil fuels (15%), renewable energy (14%) and nuclear energy (12%). The main imported energy product was petroleum products (including crude oil, which is the main component), accounting for almost two thirds of energy imports into the EU, followed by gas (26 %) and solid fossil fuels (8 %); almost two thirds of the extra-EU’s crude oil imports came from Russia (30 %), Norway (11 %), Iraq (8 %), Kazakhstan and Saudi Arabia (both 7 %) & more than three quarters of the EU’s imports of natural gas came from Russia (40 %), Norway (26 %) and Algeria (11 %), while almost three quarters of solid fuel (mostly coal) imports originated from Russia (39 %), Colombia and United States (17 % each). Of all the international players, the EU has been the most progressive on climate change issues. Recently, the European Investment Bank announced that it would stop funding fossil fuel projects by the end of 2021. On its part, the European Parliament has urged all EU countries to commit to net zero GHG emissions by 2050. The Commission is expected to present in 2020 a comprehensive plan to reduce emissions towards 55% in a reasonable way by 2030.
In conclusion, it is observed that the period from 2000 to 2019 has been transformational in multiple ways in respect of the evolution of the emphasis between renewables and non-renewables in the energy mix reflective of domestic green politics the world over, especially in Asia. The dissonance amidst the principal actors of the energy architecture can be inferred from transition from Balance to Dominance in the case of US; Emphasis on Environment in the case of EU; taking the lead in global Supply of Lithium and Nuclear in the case of PRC, Four Pillars of Energy Future in the case of India, Reciprocal Dimension of Energy Security in the case of OPEC and the myriad of perspectives from Plurilateral and Multilateral Institutions. With the passage of time, since the energy crisis of 1970s, reconciliation of how major players view energy security warrants greater attention as we move ahead.
Energy Production is Moving Upwards
The United Nations (UN) Environment Programme, and numerous research organizations working in consortium found in a recent report “the world’s nations are on track to produce more than twice as much coal, oil, and gas as can be burned in 2030.”The British Petroleum (BP) Statistical Review of World Energy 2019 has:
“Total global proved reserves of oil – that is the volumes that can be recovered from known reservoirs under existing economic and operating condition – stood at 1.730 trillion barrels at the end of 2018.”
The world has plenty of oil, and we are not close to reaching peak oil, and consumption is growing according to the International Energy Agency’s latest projections. This on top of U.S., CO2 emissions rose in 2018, 2.7 percent for the first time since 2014 according to the Energy Information Administration (EIA) – the uptick came from “higher natural gas-related emissions, but coal emissions fell by 4 percent.”
Economic growth coupled with hotter summers, and colder winters contributed to U.S. emission increases. Increased renewable usage from sun and wind farms also aided emission growth since solar panels and wind turbines are intermittent energy to electricity sources that need continual fossil fuel backup from coal and natural gas-powered, power plants.
Fossil fuel production will outpace Paris Climate Agreement (PCA) reductions that target to keep temperature increases under 1.5degrees Celsius, or at 2 degree Celsius, pre-Industrial levels. Growing prosperity in China, India, Africa, and the U.S. will fuel production gains, and override PCA agreement accords.
This analysis is based on energy policy from eight of the largest fossil fuel, and deep earth mineral producers in the world: “Australia, Canada, Russia, U.S., China, India, Indonesia, and Norway.” These eight countries constitute 60 percent of domestic-based, and global fossil fuel production. Middle Eastern countries such as Saudi Arabia and Iran do not release production numbers.
PCA signatories are upset over increased global fossil fuel exploration and production (E&P). China, India and the booming Asian hemisphere (what is now called the “Asian Century”) are using more oil, coal, and natural gas today and into the projected future. Whereas, new clean energy investments “fell by more than a fifth, coal-fired power generation jumped to a new high last year.” This means renewables such as solar, wind, and biomass used for energy to electricity are not overtaking fossil fuels anytime soon.
Evidenced by coal-fired power generation excavated and used increased the past two years, and “coal accounted for 47% of all power generation across 104 countries.” India’s over one billion people and growing population has confirmed coal is their energy to electrical mainstay for the next thirty years.
The only carbon-free, zero-carbon energy to electricity source is nuclear energy. It is France’s number one energy to electricity generation resource. Not even natural gas-fired power plants meet this criterion. If fossil fuels are growing then nuclear energy to combat rising emissions is the best electrical option available under current, emission-restraining, technological constraints.
International Energy Agency (IEA) chief, Fatih Birol expects the U.S. shale sector to continue explosive growth. Birol also said, “that the U.S. will make up most of global oil supply growth.” This will fill the gap for Asian countries needing additional oil and natural gas. Additionally, this boom in U.S. shale E&P that began during the Obama administration continues upending and changing global, geopolitics in unexpected ways that doesn’t involve traditional militaries or large-scale global conflicts. This is positive for global economic prosperity.
The world is awash in oil, natural gas, and coal whether we like it or not according to the BP Statistical Review of World Energy, 2019, but global policymakers are causing more problems than solutions by embracing renewables and banning fossil fuel E&P. Europe’s Green New Deal is based on unrealized scientific evidence that causes environmental leaders like Michael Shellenberger to dispute the hyperbolic climate rhetoric.
Embracing global warming energy policies produce results that damages the environment from “millions of toxic wind turbine blades sent to landfills,” to electrical grid blackouts in Australia, Great Britain and New York City (and a $6 billion ratepayer, wind subsidy, cost overcharge) to a Texas city needlessly enduring surging electricity costs from going 100 percent renewable. We are now witnessing wind power disasters in Canada, Europe (especially, Germany), Ireland, and the environmental cleanup costs are higher than fossil fuels compared to the taxpayer and ratepayer subsidies renewables receive.
Leading U.S. Democratic Presidential candidates want to eliminate fossil fuels by replacing them with renewables according to environmentalist Paul Driessen without understanding the consequences of how fossil fuels affect every part of all of our lives.
Hydraulic fracturing (fracking) is “under fire in California,” (the 5thlargest economy in the world) without explaining how does this economically robust state replace the over 6,000 products that originate from a barrel of crude oil? These anti-fossil fuel decisions cause companies like international, financial giant Charles Schwab to leave the state, and hurt American economic interests and national security. This ultimately affects NATO, EU, and America’s geopolitical, global security interests that are the cornerstone of the post World War II, U.S.-led, liberal order.
America is attempting to electrify their economy and decarbonize without understanding electricity is not a stand-alone energy source the way fossil fuels, nuclear, and renewables are – but common renewables, the sun and wind for energy to electricity – run into problems over being chaotically intermittent, and mathematically unstable. Again, the only way to “reduce greenhouse gas emissions,” and produce zero-carbon energy to electricity is from nuclear power plants.
From Berkeley, California to Brookline, Massachusetts that recently voted to ban natural gas, and only use electricity for heat, air conditioning, and appliance-use this is a vote to economically depress these cities. Massachusetts’ electrification needs are approximately 50 percent met by natural gas, and the state has a shortfall over banning new pipelines. To meet their natural gas needs, Massachusetts’s imports12 percent of their natural gas from Russia.
What we are seeing is a fossil fuel dilemma, and climate change, anthropogenic (man-made) global warming, and energy policies based on these premises to rid the world of carbon and greenhouse-gases are “a first-world problem.” The U.S., European capitals, and the United Nations (UN) seemed more concerned about the environment than the 2 billion people globally without electricity.
Shockingly, the U.S. could literally turn off the entire country from any source of energy and global emissions would still grow according to U.S. Congressional testimony in 2017. The entire U.S. economy, military and government could disappear, and global pollution, and respiratory illness would still rise. The reason why is “one of the biggest sources of carbon dioxide emissions is developing countries.” Think China, India, and Africa.
What if it’s time to start asking serious questions about the validity of man-made climate change, and how “scientific breakthrough” such as carbon capture technology coming from the Massachusetts Institute of Technology (M.I.T.) can save us instead of renewables and warning the earth will die off in 10-12 years? It’s difficult to trust these warnings when every apocalyptic prediction from the last 50 years has never come true that the earth is dying, because of global warming.
When teen climate activist, Greta Thunberg, made her impassioned speech to the UN this fall, another group of 500 atmospheric scientists, engineers and related professional called Friends of Science sent a registered letter to the UN Secretary-General “stating that there is no climate emergency and climate policies should be designed to benefit the lives of people.”
If fossil fuels are growing, but the west, led by the U.S. and Europe believe CO2 is killing the planet then this dilemma of fossil fuels versus renewables powering the planet worsens. The frightening scenario of environmental sustainability doesn’t seem to coincide with economic growth laid out in the book The Green Reich. This end-game of ridding the world of 6,000 products, affordable electricity, economic growth for Third World countries – even entire continents – is on the line without any answers for how you replace fossil fuels with solar panels, wind turbines, and electric vehicles.
Ideology says renewables will work, damn the consequences, the facts say otherwise. Abundant, affordable, reliable, scalable, flexible oil, coal, natural gas and nuclear energy are why the planet is alive. Rid the world of this, and jobs disappear, economies wither, and modern, prosperous, peace-loving, sustainable nations collapse into anarchy. Upend the growth of fossil fuels globally, and watch China, India, Russia, Africa and other growing nations undo the liberal-led order. Do this and lifestyles and “living standards spiral downward” for the remainder of this century.
The power of Siberia heralds a landmark of Sino-Russian solidarity
Authors: Zhou Dongchen, Paul Wang
Although China and Russia have forged their comprehensive strategic partnership into a de facto alliance, it is still opined in the way of the classical geopolitics. Yet, the east-route of China-Russia natural gas pipeline which was functional on December 2 has since heralded a new milestone for deepened energy cooperation between these two Eurasian powers. The project that was signed in 2014 is a $400-billion-gas supply deal and connects the world’s largest natural gas supplier (with a total length of more than 5,000 km) and the most potential natural gas consumer market. It is the first natural gas pipeline between the two largest land powers and also the first cross-border gas pipeline in northeast China. Technically, it is scheduled to be completed in 2020.
China and Russia lost no time to show a video call on December 2 as the two heads of state, Xi and Putin, jointly witnessed the launching ceremony of the China-Russia east-route natural gas pipeline. Xi, in Beijing, hailed the pipeline as a historical deal of Sino-Russian energy cooperation, describing it as a win-win model of major powers’ cooperation. He requested to ensure the project’s safety and reliability and to promote sustainable economic and social development in areas along the pipeline.
For sure, the east-route pipeline is not only supplied to China, but also to the local consumers in Russia’s Far East. In addition, the project would insure to create jobs and bring in more income for the local Russians, further promoting the economic and social development in Russia. Due to this, Putin announced in Russia’s Sochi that inauguration of the pipeline is of historic significance and would bring bilateral strategic relations to new heights. The event itself can be perceived both historical and unprecedented because a gas route has been laid underneath the Eurasian gas space and now moving towards one of the largest geoeconomic formation. With this large-scale gas project started, a new page will open in bilateral relations not only in the energy field, but also there is enormous potential for further development and further cooperation.
Considering that China and Russia have cooperated in the fields of natural and oil projects for decades, why is the east-route gas so significant to the two sides? Firstly, trans-regional gas projects, also named as “the power of Siberia”, contribute to the development of many regions inside and outside the two countries, which subsequently invest additional infrastructure and jobs. As the Chinese market is constantly growing, and in recent years has been growing at double-digit rates, Beijing’s energy needs will continue to grow steadily. Secondly, while coal remains the main source of energy for Chinese economic leap, a further industrialization has led to increasing environmental backlash. Be aware of the plights of its dependence on coal, China has been driven by the urgent needs over the past years to have accelerated the use of clean and newer environmental standards backed up by its significant efforts to combat air pollution.
Accordingly, it is not surprising that China is keen in reducing greenhouse gas emissions, striving to reduce the use of coal and strictly implementing the Paris Accords, including China’s large investments in its research and development of large-scale energy efficiency programs, and the rapid expansion of the renewable energy and nuclear energy. Therefore, the Power of Siberia gas pipeline will not only contribute to the socio-economic development of the Far East, but will also create conditions for gas supply and gasification of the Russian regions alongside the development of modern gas processing and gas-chemical industries in Russia. Taking into account a new map of the global energy being formed, it is fair to argue that “the Power of Siberia” would create a new pipeline system in the existing transport corridor of the Siberia to the borders of the two countries and beyond in the near future.
For sure, it is necessary to note the great merit of two leaders-Chinese President Xi and his Russian counterpart Putin-under the strategic leadership of which Sino-Russian relations of comprehensive coordination and strategic partnership have entered a new era. This is characterized by the highest degree of mutual trust, the highest level of interaction and strategic consensus. In light of the current international reality where the United States has always used the difference in political systems and diplomatic philosophies to attack China Russia with a cold war mentality, the further strengthening of the strategic interaction between the two Eurasian powers is of special meaning and the impacts on the world peace and security. In the coming decades, China will have become more dependent on the energy supply and agricultural goods from its northern neighbor, while the Russian economy in the vast Siberia will be benefited by substantial FDI from China. As a result, the current discrepancy between their strong political relations and the weak economic ties would be effectively addressed, together, the pipeline could revive the prosperity of China’s north eastern provinces and Russia’s Far East region, not mention of their current close cooperation in the field of information technology and space.
Accordingly, it is fair to argue that China and Russia play a decisive role in the formation of a new energy map of the world with the launch of the “Power of Siberia” gas pipeline project which sets a prime example of how the natural gas market is becoming mobile and cross-regional. Equally in terms of the public disagreements between the United States and its European allies, China and Russia working together have moved towards more dynamic relations with European countries and in particular the member states of the European Economic Union—Russia, Belarus, Kazakhstan, Tajikistan and Armenia.
All in all, China and Russia’s foreign policy, based on the pursuit of mutual benefits, made the materialization of the power of Siberia energy deal feasible. The operationalization of the pipeline is proof that the world doesn’t just function based on a single system. Americans may believe that theirs functions well, but that doesn’t disqualify other systems from being equally functional or even superior in making and executing long-term goals that benefit the public. The pipeline has elevated the bilateral relationship to a new level and will benefit future generations. With this new linkage, Sino-Russian common interests would be more intertwined, making mutual benefits even more important going forward. This is what President Xi has reiterated as our true relationship will be of utmost importance in China’s foreign policy.
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