Brighter Outlook Ahead?: Q&A with Mark Levine

This interview originally appeared on the China Dialogue and is reposted with permission.

For four years, the China Energy Group at Lawrence Berkeley National Laboratory in California has collected end-use energy data on appliances and buildings in China in order to project the country’s energy demand to 2050 — 15 years beyond most other surveys, and in far greater detail. The results, to be published later this month, suggest China’s energy demand will peak between 2025 and 2030. chinadialogue’s Linden Ellis discussed the research with China Energy Group director, Mark Levine.

Linden Ellis: What did your report originally set out to find?

Mark Levine: Originally, we were looking to improve our very detailed model of energy use in China, and we wanted to expand it to 2020, or 2030. As we did the work, it became clear that there were issues that could not be addressed if one ended the analysis at 2030.

LE: With the findings in hand, what is new or significant about the research?

ML: We developed an approach that, instead of relying on economic forecasts, looked at natural limits: for example, how much floor space per family might the Chinese need or want in the long term? We concluded that it would never be as much as the US has, because China does not have anything near the space we have; and we thought it would be more than what the Japanese have, because China has a little more space than the Japanese. When we did that, we discovered that in not too many years, China will have “saturated” the space per family, and the rest of construction would be replacement.

We did the same thing with commercial space and concluded that China would never reach the US level and would exceed the Japanese level. And we did the same with fertiliser. We asked a different question: how much fertiliser could be used per hectare? Based on the fact that arable land in China is not growing, and the intensity of fertiliser use is already higher than desirable, we see no growth in fertiliser use. Furthermore, fertiliser in China is now made from coal, which is a very inefficient process. As time goes on, it is likely to be made from natural gas, which is more efficient. Instead of having energy from fertiliser increasing, we have it decreasing over time.

Because the model looks at all the end uses of note and technologies to supply energy services at a very detailed level, we can say that these things saturate. Refrigerators have already saturated in urban China and will shortly saturate in rural China. Air conditioners will saturate a little later, cars much later, and once they’ve saturated all you have are replacements. At some point, China becomes a mature economy, much like the US, where even though we are, some might say, profligate in our use of energy and super consumers, we grow energy use at 1% to 1.5% a year.

LE: So when does that “saturation” take place in China?

ML: That is what this detailed modelling can tell you. Instead of saying “saturation”, because different things saturate at different times, we talk about a plateau for overall energy. When we reach 5% to 10% of the peak, we say that is the onset of the plateau.

The onset of the plateau for our continued improvement scenario – which is our guess at the policies that are likely to be pursued, technologies that are likely to be adopted and the behaviour patterns of people – the plateau begins around 2030. For the scenario where government is much more aggressively pursuing efficiency, where more aggressive technologies are pursued, it is about 2025. Now that is really significant. If you compare those results with all other work, they just keep growing after 2030. The other models don’t know about saturation.

LE: Where is the data in your model from, and are you concerned about uncertainty in the data?

ML: The simple answer to your question is: they are official data, they are unofficial data, they are data that we found, they are data that other people found.

Let me give you an example. When we looked at commercial buildings, we discovered that the other work that had been done, including most but not all of the Chinese work, missed about half of the floor area of commercial buildings. How could they do that? The National Bureau of Statistics data provides commercial building floor space only for urban areas, it doesn’t include rural areas, which is about half of commercial floor space. Now that turns out to be a critical parameter, because if you are using half of what really exists, than saturation occurs further in the future.

The reality is twofold as to why one can do this report. As troublesome as it is to find uncertainties in data, China has far better data than any other developing country; it almost competes with some developed countries in terms of quality of data. The second thing is that there are ways to check data. All the end uses have to equal total production minus exports plus imports. Typically we are off by 5% to 10%.

LE: What is the biggest impact of this study?

ML: The study is likely to impact both American and Chinese policy. The first time I presented this data was at a plenary talk at the American Council for an Energy-Efficient Economy, which is very influential in Washington on energy-efficiency matters. One person in the audience was the chairman of the Federal Energy Regulatory Commission, and he said he would arrange to have meetings with members of Congress and US climate-change negotiators.

The second forum was as a plenary speaker at a conference at the Great Hall of the People in China. I assure you, the Chinese are aware of this data and it will influence their policy on such things as climate change. In fact, it will confirm their policy.

LE: How will the report confirm Chinese climate policy?

ML: The data says that in the next 10, 15 or 20 years, it’s going to be extremely hard to know what energy use will be, because China is on a trajectory where it is still growing rapidly, but we don’t know how rapidly. There are all kinds of uncertainties. For China, energy growth could be 5%, 10% or less – you just don’t know.

That means that if you are China, and you take your commitment seriously, don’t make a commitment for a [emissions] cap. The only way you could do that is if you are prepared to be dishonest as, shall we say, many people who signed on to a cap – many industrialised countries – were. However, when you get to 2025, 2030 you can actually commit to an absolute cap. Until then, you want to commit to intensity targets.

LE: So can China make its 40% to 45% carbon-intensity target by 2020?

ML: Let me answer in two ways. First, if China says they are going to make it, they are going to make it. The somersaults that they are making people do in order to reach their 20% target are unbelievable. People aren’t allowed to turn on heat in some provinces when it is cold because the provincial folks have to meet their targets. They are going to do whatever they can to make those targets. And that applies to the 40% to 45%.

Now, can they in fact reasonably do it? The answer is yes, in my own opinion. I don’t think it will necessarily be easy, but it is achievable.

LE: Will China overwhelm the world with its greenhouse gases?

ML: If one recognises that China’s emissions do not grow endlessly, the emissions aren’t so overwhelming. In our advanced case, emissions are about 50% higher than today’s levels when they level off and that, on a per capita basis, is 30% as much as the US. In our continued improvement case, China’s emissions level off at less than 40% of US emissions. If the US can come down to 30% and China goes up to 30%, then you could say China is contributing an awful lot to greenhouse-gas emissions in a world where emissions are a lot lower than they are today. So the answer is no, and the argument that “China is going to overwhelm us, why should we do anything?” makes no sense at all.

Linden Ellis is US project director at chinadialogue.