supported by similar revolutions in consumption,
technology, demand and the energy system itself.
(3) The aim of the energy supply revolution is
to combat climate change, meet demand and
guarantee energy security
The most important role of the energy revolution
is to meet the demand for energy and improve
people’s quality of life, while combating global
climate change. In the transition from
high-carbon to low-carbon energy, the energy
revolution focuses on the supply of cleaner
conventional energy and the development of
renewable energy. This will enable energy supply to match demand more effectively and adapt
to change more flexibly.
The energy revolution aims for energy security. Close to 70% of China’s energy comes from
coal, which makes China the country suffering
the most from coal-smoke pollution and the
world’s largest greenhouse gas emitter. As a
result, China shoulders increasing pressure from
the international community to reduce its emissions. As the scramble for oil and gas intensifies,
the difficulty of accessing resources in international markets is mounting. China’s oil imports
are surging, around 80% of which come from the
Middle East and North Africa. Such a high
dependency on one region, in combination with a
lack of strategic oil reserve capacity, weakens
China’s ability to respond to emergencies.
A weak emergency response system increases
the risk of long-term dependency on international
oil resources. The energy revolution must therefore focus on China’s specific conditions and aim
to ensure energy security.
1.1.3 Implications of the Energy
Revolution for China
At the 6th meeting of the Central Leading Group
for Financial and Economic Affairs in 2014,
President Xi defined the specific requirements of
the energy revolution: to develop a diversified
energy supply system; create a diversified
domestic supply system to ensure energy security; vigorously promote clean and efficient coal
use; focus on more non-coal energy supply
sources to develop an energy supply system
based on coal, oil and gas, nuclear power and
renewable energy; strengthen the power transmission and distribution systems; and build
energy storage facilities.
These requirements reflect China’s actual
conditions. China has many challenges to
address, including excess capacity in fossil
energy (mainly coal), insufficient supplies of
renewable energy, intense environmental constraints, and severe defects in the energy supply
system. Alleviation of excess capacity in the coal
sector, optimisation of the energy supply system,
and robust development of clean energy are,
therefore, high on the energy revolution agenda.
1.2 Characteristics of the Energy
Revolution
1.2.1 Key Characteristics
(1) Changes in primary energy
(1) Fossil fuels
Fossil fuels include coal, oil and gas. Coal mining
and coal utilisation technologies are relatively
mature, but due to high levels of pollution coal’s
share of the energy mix will decrease dramatically
as the energy revolution moves forward. In the
future, clean coal mining technologies will be
widely deployed to enable scientific and efficient
exploitation, and investments in safety will also
increase. This will enable the cost-effective and
safe exploitation of coal resources.
China has limited proven resources of conventional oil and gas. There is great potential for
unconventional oil and gas in China. However,
due to the limitations of technology and other
factors, the utilisation rate of unconventional oil
and gas remains low. The energy revolution,
therefore, needs to shift to more unconventional
oil and gas, deep-sea and deep-shale oil and gas
resources. It needs to accelerate the exploration
and production of shale gas and coalbed methane
through technology intensification and innovation, and it needs to promote a low-cost, clean
and green energy strategy.
Special Report 1: A Study of China’s Energy Supply Revolution
43
technology, demand and the energy system itself.
(3) The aim of the energy supply revolution is
to combat climate change, meet demand and
guarantee energy security
The most important role of the energy revolution
is to meet the demand for energy and improve
people’s quality of life, while combating global
climate change. In the transition from
high-carbon to low-carbon energy, the energy
revolution focuses on the supply of cleaner
conventional energy and the development of
renewable energy. This will enable energy supply to match demand more effectively and adapt
to change more flexibly.
The energy revolution aims for energy security. Close to 70% of China’s energy comes from
coal, which makes China the country suffering
the most from coal-smoke pollution and the
world’s largest greenhouse gas emitter. As a
result, China shoulders increasing pressure from
the international community to reduce its emissions. As the scramble for oil and gas intensifies,
the difficulty of accessing resources in international markets is mounting. China’s oil imports
are surging, around 80% of which come from the
Middle East and North Africa. Such a high
dependency on one region, in combination with a
lack of strategic oil reserve capacity, weakens
China’s ability to respond to emergencies.
A weak emergency response system increases
the risk of long-term dependency on international
oil resources. The energy revolution must therefore focus on China’s specific conditions and aim
to ensure energy security.
1.1.3 Implications of the Energy
Revolution for China
At the 6th meeting of the Central Leading Group
for Financial and Economic Affairs in 2014,
President Xi defined the specific requirements of
the energy revolution: to develop a diversified
energy supply system; create a diversified
domestic supply system to ensure energy security; vigorously promote clean and efficient coal
use; focus on more non-coal energy supply
sources to develop an energy supply system
based on coal, oil and gas, nuclear power and
renewable energy; strengthen the power transmission and distribution systems; and build
energy storage facilities.
These requirements reflect China’s actual
conditions. China has many challenges to
address, including excess capacity in fossil
energy (mainly coal), insufficient supplies of
renewable energy, intense environmental constraints, and severe defects in the energy supply
system. Alleviation of excess capacity in the coal
sector, optimisation of the energy supply system,
and robust development of clean energy are,
therefore, high on the energy revolution agenda.
1.2 Characteristics of the Energy
Revolution
1.2.1 Key Characteristics
(1) Changes in primary energy
(1) Fossil fuels
Fossil fuels include coal, oil and gas. Coal mining
and coal utilisation technologies are relatively
mature, but due to high levels of pollution coal’s
share of the energy mix will decrease dramatically
as the energy revolution moves forward. In the
future, clean coal mining technologies will be
widely deployed to enable scientific and efficient
exploitation, and investments in safety will also
increase. This will enable the cost-effective and
safe exploitation of coal resources.
China has limited proven resources of conventional oil and gas. There is great potential for
unconventional oil and gas in China. However,
due to the limitations of technology and other
factors, the utilisation rate of unconventional oil
and gas remains low. The energy revolution,
therefore, needs to shift to more unconventional
oil and gas, deep-sea and deep-shale oil and gas
resources. It needs to accelerate the exploration
and production of shale gas and coalbed methane
through technology intensification and innovation, and it needs to promote a low-cost, clean
and green energy strategy.
Special Report 1: A Study of China’s Energy Supply Revolution
43