China’s renewable energy industry is poised to lead an unprecedented industrial transformation that would turn the world’s largest greenhouse gases emitter into a carbon neutral country in less than four decades, at an estimated cost of US$5 trillion.
The nation, already the biggest global producer of hydro, wind and solar power, will have to curtail most fossil fuel production and drastically install more equipment to harness nature’s energy to meet the 2060 carbon neutrality goal pledged by President Xi Jinping to the United Nations General Assembly in September.
The uncertain journey to carbon neutrality – where residual emission is fully offset by amounts captured from the atmosphere – will be a gradual and at times painful process, because it transforms livelihood in the tens of millions, involving trillions of dollars in funding, analysts said.
The capture, usage and storage of carbon, a potential game-changer for the long-term decarbonisation in fossil fuel industries, is still nascent in China and is uneconomical, said HSBC’s head of Asia utilities research Evan Li. These carbon capture facilities would triple the cost of coal-fired power, he said, citing data from the Institute for Energy Economics and Financial Analysis in Ohio, which said in July that there is “no commercially viable examples of … [such projects] … anywhere in the world.”