Diagrams show the Asia-Pacific large dependence on coal for energy

Piles of coal at Rizhao port in China’s Shandong province on November 2, 2021.

VCG | Visual China Group | Getty pictures

The Asia-Pacific is home to some of the world’s largest carbon emissions – and experts say much of the global effort to combat climate change depends on Asian countries reducing their dependence on coal.

The region accounted for 52% of global carbon dioxide emissions last year, according to the latest edition of BP̵[ads1]7;s Statistical Review of World Energy, a widely cited report.

China alone contributed 59% of the region’s emissions, while India accounted for 13.7%, the report showed.

Global leaders and environmentalists gathered in Glasgow, Scotland, this month for the UN climate summit, known as COP26. They hope to eventually phase out the use of fossil fuels – including coal – to cut carbon emissions and limit global warming.

On Thursday, 28 countries joined an international alliance dedicated to phasing out coal, but the world’s largest coal burners – such as China and India – did not sign up.

The transition to renewable energy is “too slow”

Coal accounted for more than a quarter of the world’s primary energy consumption. Primary energy refers to energy in its original form – such as coal and oil – and before it is converted into other resources.

Slightly less than half – or about 47.8% – of the energy consumed in the Asia-Pacific last year came from coal, according to data in the BP report. This percentage of coal consumption is the highest among geographical groups mentioned in the report, which included Africa, Europe and North America.

While net zero targets come thick and fast… practically all details are missing on how these will be achieved.

Gavin Thompson

Asia-Pacific Deputy Chairman, Wood Mackenzie

In the Asia-Pacific region, coal accounted for more than half of the energy consumed in China and India last year, the data showed.

The region’s move away from fossil fuels to renewable sources has remained “too slow,” said Gavin Thompson, Asia-Pacific vice president of energy consulting firm Wood Mackenzie.

“Much of this stems from government policy. And while net zero targets are coming thick and fast … virtually every detail is missing on how these will be achieved,” Thompson said in an October report.

“Without policy progress, Asia’s future growth still looks set to depend on fossil fuels, especially coal,” he added.

Net zero emissions refer to achieving an overall balance between produced greenhouse gas emissions and greenhouse gas emissions that are removed from the atmosphere, either in natural ways or by using the still incipient carbon capture technology.

Asian countries come on board

Asian countries that have announced their climate promises include:

Indonesia – the world’s largest exporter of thermal coal – aims to cover 23% of its energy needs with renewable sources by 2025 and now net zero carbon emissions by 2060.

A combination of taxation and subsidies would be needed to help coal companies gradually move to greener industries, said Indonesia’s Finance Minister Sri Mulyani Indrawati.

“We do not want to kill the business, we want it to have a fair and equitable transition,” she told CNBC’s Sustainable Future Forum in October.

The role of China and India

The use of coal is among the many problems that separate advanced countries and developing countries when trying to limit damage to the environment.

India has previously claimed that developing countries have contributed little to carbon emissions in the past and encouraged developed countries to play a greater role. India is the world’s third largest carbon emitter.

China – the world’s largest emitter of carbon dioxide – has also encouraged developed countries to help their peers in development to do more.

It is not clear whether countries can bridge their differences at the COP26 meeting in Glasgow.

Just before the climate summit, the leaders of the group of 20 major economies failed to explicitly commit to carbon neutrality by 2050 and promise an end to subsidies for fossil fuels, economists at the French bank Natixis pointed out.

“It opens the door to bring home coal-fired plants, especially for the coal-dependent economies that could suffer severely from the energy transition such as China and India,” economists said in a report last week.

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They noted that net zero emissions targets announced by China and India – by 2060 and 2070 respectively – are later than the 2050 timeline considered necessary to keep global warming within 1.5 degrees Celsius above pre-industrial levels.

The Climate Action Tracker consortium, which tracks the government’s climate actions, policies and goals, rated commitments from both China and India as “highly inadequate”. India’s assessment was made before Prime Minister Narendra Modi announced the target of net zero emissions.

“Long-term” impact on China’s growth

Nevertheless, China has good reasons to work against net-zero carbon emissions, said David Murphy, head of China’s quantitative insight at Credit Suisse.

“Beijing sees this as a growth driver, so they are turning to green energy, to decarbonisation as a growth driver just at a time when the traditional drivers in China – housing, investment spending in fixed assets – [are] to reach a peak, “he told CNBC’s” Squawk Box Asia “last week.

Murphy said China has become a leader in industries such as solar energy and electric vehicles. These industries could generate economic growth for China “for a long time,” he added.

– CNBC’s Saheli Roy Choudhury contributed to this report.

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