China's problems in collecting emissions data are also due to the widespread use © of coal CFOTO/IMAGO
As the world's largest CO₂ emitter, China has problems recording its own emissions. The government wants to tackle the problem, but faces massive challenges.
This analysis is IPPEN. MEDIA in the course of a cooperation with the Climate.Table Professional Briefing – it was first published by Climate.Table on 01 June 2023.
Beijing – The COP intermediate conference in Bonn, which starts on June 5, will also discuss a global stocktake on progress in international climate policy. Emissions data play a central role in this. However, it is not easy to record them. Many developing countries have made little progress in data collection in recent years. But China, the world's largest CO₂ emitter, is also facing major challenges.
China's CO₂ data is based on estimates and surrogate indicators such as energy consumption in production. However, the estimates for many energy-intensive sectors of the economy, such as metal processing or the chemical sector, are very inaccurate and could vary greatly from plant to plant, say experts at the consulting agency Trivium China. "The lack of reliable emissions data at the industry level could make it difficult for authorities in the long term to shape policies to meet climate targets," Cory Combs of Trivium China told Table.Media. However, the size of the gap between estimated and actual emissions is unclear.
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China: Data is insufficiently published
The lack of clarity about China's emissions is exacerbated by the fact that much of the data is not published. Unlike in the traditional industrialized countries, there is "no regular reporting that would disclose the country's total emissions," says energy expert Lauri Myllyvirta. Total CO₂ emissions from the energy sector are only indirectly reported annually as a reduction in CO₂ intensity in relation to economic output, Myllyvirta explains to Table.Media.
"There is no breakdown by sector," says Myllyvirta. CO₂ emissions from cement production and other industrial emissions are not published. External analysts must estimate the total CO₂ data from the published data. China's National Greenhouse Gas Inventory is also outdated. The last inventory was published in 2019 and is based on data from 2014. As a developing country (Non-Annex I), China does not have to report to the UNFCCC more regularly.
Has China reported emissions that are too high?
However, the guesswork about actual emissions could also lead to China publishing CO₂ emissions that are too high for 2022, as Myllyvirta explains. In order to avoid energy crises like in the recent past, the government has expanded domestic coal production. This led to more low-quality coal coming onto the market. The power plants have to burn more of this to produce the same amount of energy. Coal consumption therefore increased – but not necessarily CO₂ emissions. This is because it depends less on the amount of coal and more on the quality of the coal.
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If this decreases, emissions also decrease. Coal mines, however, have provided false or no information about the decreasing quality. The authorities therefore assume that the quality will remain the same with increasing consumption, increasing energy volume and thus increasing emissions. According to official data, China's emissions therefore grew by 2022.1 percent in 3. But the conflicting data on coal quality and other data points showed a decrease in emissions of about one percent, according to expert Myllyvirta.
Combs also says: "The main reason for the uncertainty in China's emissions is the extensive use of coal," both for power generation and for industrial purposes, such as steelmaking. There are a lot of "sources of data uncertainty". Different types of coal with different quality are used for the different processes. China produces more steel than the rest of the world combined and has the most coal-fired power plants. The potential points for data problems add up "on a scale that is second to none," Combs said.
Data problems and manipulations in emissions trading
China's emissions trading system requires participating coal-fired and gas-fired power plants to submit an annual emissions report. It is checked by local authorities. But there is a lack of the necessary resources. "Many local governments have argued that they do not have sufficient resources to carry out the monitoring, reporting and verification process comprehensively, which often leads to data falsification and a resulting gap in emissions reporting," Seb Kennedy tells Table.Media. He is an analyst at the data provider Transition Zero. A large part of the data is also reported by the companies "themselves and not independently verified," Kennedy said.
Consulting firms that check the data have already advised companies to manipulate them in order not to have to buy CO₂ certificates. According to ETS expert Zhibin Chen of research and consulting firm Adelphi, China's Ministry of Environment "recognized the manipulation problem in time and carried out a major data review operation in which most of the data was corrected." The government has issued new guidelines on data collection. In a large country like China, however, it is difficult to "ensure that every company and every auditor can implement the same new standard," Chen said. It takes time to find out and solve the problems, according to the Adelphi expert.
Cory Combs of Trivium China says: "Without accurate emissions data, there can be no accurate allocation of allowances" in emissions trading. At a certain point, this could "undermine the carbon pricing mechanism". The extension of the ETS to the steel, cement and aluminium sectors has already been postponed, partly due to the poor data situation in these sectors.
China wants to close the CO₂ data gap
China is pursuing several measures to overcome the data problems. The state:
- plans to set up a "Carbon Emissions Statistics and Accounting System" – with targets for 2023 and 2025. The aim is to develop methods for adding up the emissions of individual sectors without losses and double counting, according to analysts at Trivium China. Data acquisition via satellite is also to be researched.
- launched a pilot program in 2021 cities in September 16, requiring some of the largest emitters of major industrial sectors to "establish comprehensive new plans to monitor greenhouse gases." In addition, selected regions and cities will evaluate the extent to which their environment can act as carbon sinks. Initially, it was said that the program should deliver initial results in Q1 2023. On Monday, however, China's Ministry of Environment announced that there would be a second phase of testing with new companies, standards and technology.
- published a long-term plan for the further development of metrology at the beginning of 2022, which also provides for better measurement of CO₂ emissions. One component of the plan is the improvement of technologies for directly measuring the emissions of individual emitters such as industrial companies.
According to Cory Combs of Trivium China, China's Ministry of Environment has a clear focus on improving the "sharpness of detail and accuracy of emissions data." However, many unanswered questions remain as to whether this can be achieved in the near future, according to Combs.