Continuous Energy Transition with Remarkable Results in Energy Saving and Consumption Reduction

Continuous Energy Transition with Remarkable Results in Energy Saving and Consumption Reduction 

—Series Report XIV on the Economic and Social Development Achievements since the 18th CPC National Congress 

Since the 18th CPC National Congress, in the face of new changes in the energy supply and demand pattern and new trends in international energy development, the CPC Central Committee with Comrade Xi Jinping at its core has proposed a new energy security strategy of "four revolutions and one cooperation"(revolution in energy consumption, energy supply, energy technology and energy system; full-scale international cooperation) to provide guide for high-quality energy development in the new era. The structural reform of the energy supply side continues to advance, the ability of energy security continues to increase, the multi-wheel drive supply system is basically established, the pace of transition to green and low-carbon energy is accelerated, the energy efficiency is steadily improved, there are remarkable results of energy conservation and consumption reduction, and new progress has been made in the energy industry. 

I. Continuous Enhancement of the Guaranteed Energy Supply Ability, with an Increasing Proportion of Clean Energy

Since the 18th CPC National Congress, China has actively promoted the energy supply revolution, adhered to domestic diversified supply, deepened structural reforms on the energy supply side, prioritized the development of renewable energy, promoted clean and efficient development and utilization of coal, and furthered its efforts in oil and gas exploration and development. Its ability to ensure energy supply continues to improve, and its pace of clean energy production has been accelerated. In 2021 [1], the total national primary energy production reached 4.33 billion tons of standard coal, an increase of 23.2% over 2012, and an average annual increase of 2.3%. 

(I) The greatly optimized structure of coal production capacity, with enhanced supply security ability 

By the end of 2021, the number of coal mines in China[2] was reduced to less than 4,500, and the output of large coal mines with an annual output of more than 1.2 million tons accounted for about 85%. Raw coal production has increased for five consecutive years since 2017. In 2021, the output reached reach 4.13 billion tons, exceeding the historical high of 3.97 billion tons in 2013. 

(II) The further oil and gas development, with advancement in reserves and production 

With the formulation and implementation of the "Seven-Year Action Plan" for increasing reserves and production in the oil and gas industry, crude oil production continued to rise from 2019 to 2021, and the output increased steadily to nearly 200 million tons; breakthroughs were made in the exploration and development of natural gas, especially unconventional natural gas. From 2017 to 2021, natural gas production increased by more than 10 billion cubic meters for five consecutive years, reaching 207.6 billion cubic meters in 2021, an increase of 87.7% over 2012 and an average annual growth rate of 7.2%. 

(III) Constantly enhanced power supply capacity, with quick growth in power production 

By the end of 2021, the national power generation installed capacity[3] reached 2.38 billion kilowatts, an increase of 1.1 times compared to 2012, with an average annual growth rate of 8.4%. In 2021, the power generation capacity reached 8.5 trillion kWh, an increase of 71.1% over 2012, and an average annual increase of 6.1%. Among it, thermal power increased by 49.1% compared with 2012, with an average annual growth of 4.5%; hydropower increased by 53.5%, with an average annual growth of 4.9%; nuclear power increased by 3.2 times, with an average annual growth of 17.2%; wind power increased by 5.8 times, with an average annual growth of 23.8%; solar power increased from 25.1 billion kWh in 2014 to 325.8 billion kWh in 2021, an increase of 12.0 times, with an average annual growth rate of 44.2%. New energy (wind power, solar energy and other new energy) power generation increased by 6.8 times, with an average annual growth rate of 25.7%. It accounted for 11.5% of the total power generation, an increase of 9.0 percentage points over 2012. 

(IV) The accelerated transformation of energy production structure, with continuous increase of the proportion of clean energy 

In 2021, the installed capacity of non-fossil energy power generation surpassed that of coal power for the first time, with a capacity of 1.12 billion kilowatts, accounting for 47.0% of the total installed capacity of power generation. The installed capacity of hydropower, wind power and solar power all exceeded 300 million kilowatts, ranking first in the world for many years in a row. Among it, hydropower reached 390.94 million kilowatts, an increase of 56.7% over 2012, with an average annual growth of 5.1%; grid-connected wind power reached 328.71 million kilowatts, an increase of 4.4 times, with an average annual growth rate of 20.5%; grid-connected solar power reached 306.54 million kilowatts, an increase of 88.9 times, with an average annual growth of 64.8%. The proportion of clean energy such as natural gas, hydropower, nuclear power, and new energy power generation in the energy production structure continues to rise. In 2021, the proportion of natural gas in the total primary energy production reached 6.1%, an increase of 2.0 percentage points from 2012, and the proportion of primary electricity and other energy increased to 20.3%, an increase of 9.1 percentage points; the proportion of raw coal was 67.0%, a decrease of 9.2 percentage points from 2012; the proportion of crude oil was 6.6%, a decrease of 1.9 percentage points. 

II. Diversified and Stable Energy Imports, with Continuous Deepening of International Cooperation 

Since the 18th CPC National Congress, China has strengthened international energy cooperation in an all-round way, effectively utilized international resources, and promoted the interconnection of energy infrastructure. It continues to promote the development and construction of the five major oil and gas cooperation zones including Central Asia-Russia, the Middle East, Africa, the Americas, and the Asia-Pacific, and the four major oil and gas import strategic channels in the northwest, northeast, southwest, and sea are basically formed. The diversification of energy imports continues to increase, and the scale of imports continues to expand, which has laid a solid foundation for energy security under open conditions. 

(I) Steady growth in energy imports 

In 2021, China's total energy net imports[4] reached 1.12 billion tons of standard coal, an increase of 83.2% over 2012, and an average annual increase of 7.0%. The net import of raw coal has been rising steadily for six consecutive years since 2016. In 2021, the net import reached 320 million tons, a record high in recent years, an increase of 14.9% over 2012, and an average annual increase of 1.6%. The net import of crude oil has maintained a high level since breaking through 500 million tons in 2019, and reached 510 million tons in 2021, an increase of 90.0% over 2012 and an average annual growth rate of 7.4%. The net import of natural gas has grown rapidly, reaching 162 billion cubic meters in 2021, an increase of 3.1 times compared with 2012, and an average annual growth rate of 17.1%. 

(II) Promising achievements in international energy cooperation 

In 2021, China's dependence on foreign energy reached 20.6%, an increase of 5.7 percentage points compared to 2012. With the pragmatic advancement of the “Belt and Road” energy cooperation, China has successively established intergovernmental energy cooperation mechanisms with many countries and regions, and built cooperative relations with a number of energy-related international organizations and multilateral mechanisms, achieving new breakthroughs in international energy cooperation. 

III. Steady Growth in Energy Consumption and Accelerated Transition to Green and Low-carbon Energy 

Since the 18th CPC National Congress, China has deeply promoted the energy consumption revolution, accelerated the transformation of energy consumption patterns, solidly carried out the reduction and substitution of coal consumption in key areas, and accelerated the large-scale, high-efficiency and scientific use of natural gas in urban gas supply, industrial fuel, gas power generation, transportation and other fields. China vigorously develops non-fossil energy with remarkable optimization of energy consumption structure and acceleration of transition to green and low-carbon energy. 

(I) Steady growth in energy consumption 

In 2021, China's total energy consumption reached 5.24 billion tons of standard coal, an increase of 30.4% over 2012, and an average annual growth rate of 3.0% in energy consumption has supported an average annual growth rate of 6.6% in gross domestic product (GDP). In terms of varieties, the growth rate of fossil energy consumption such as coal and petroleum was flat, with an average annual growth rate of 0.3% for coal consumption and 3.9% for petroleum consumption; the consumption of clean energy such as natural gas, hydropower, nuclear power, and new energy power generation grew rapidly, among which the consumption of natural gas reached an average annual growth of 10.5%, and the average annual growth rate of primary electricity and other energy consumption reached 9.3%. 

(II) Accelerated clean and low-carbon energy consumption 

In 2021, the proportion of coal in total energy consumption decreased from 68.5% in 2012 to 56.0%, a decrease of 12.5 percentage points; the proportion of petroleum increased from 17.0% to 18.5%, an increase of 1.5 percentage points; the proportion of clean energy such as natural gas, hydropower, nuclear power, new energy power generation has increased significantly, among which the proportion of natural gas has increased from 4.8% to 8.9%, an increase of 4.1 percentage points; the proportion of primary electricity and other energy has increased from 9.7% to 16.6%, an increase of 6.9 percentage points. 

(III) Continuous growth in per capita energy consumption 

In 2020, China's per capita energy consumption reached 3,531 kg of standard coal, an increase of 18.9% over 2012 and an average annual increase of 2.2%. The livelihood energy use is effectively secured. In 2020, China's per capita domestic energy consumption reached 456 kg of standard coal, an increase of 46.2% over 2012, with an average annual increase of 4.9%; per capita domestic electricity consumption increased by 7.3% annually, per capita domestic liquefied petroleum gas consumption increased by 6.7%, and the per capita domestic natural gas consumption increased by 8.1% annually. 

IV. Steady Improvement of Energy Efficiency, with Remarkable Results Achieved in Energy Saving and Consumption Reduction 

Since the 18th CPC National Congress, China has firmly carried out the principle of giving priority to energy conservation, implemented a dual control system for total energy consumption and intensity, and incorporated energy conservation indicators into performance evaluation index systems such as ecological civilization and green development. It continuously improves energy conservation regulations and standards, and energy conservation policy mechanisms, continues to eliminate outdated production capacity, accelerates the upgrading and transformation of traditional industries, cultivate new momentum, effectively promotes energy conservation and emission reduction in key areas such as industry, construction, and transportation, and has achieved remarkable results in energy conservation and consumption reduction. 

(I) Significant reduction of energy consumption per unit product 

Comprehensive energy consumption per unit of product has been continuously reduced by process upgrades, updating and transforming energy-consuming equipment, accelerating the elimination of outdated production capacity, and promoting high-efficiency and energy-saving technologies. In 2021, nearly 90% of the 39 items of the comprehensive energy consumption per unit of product production in key energy-consuming industrial enterprises was reduced compared with 2012. Among them, the comprehensive energy consumption per ton of steel decreased by 9.8%, the coal consumption of thermal power generation decreased by 5.8%, and the unit consumption of caustic soda, machine-made paper and cardboard, flat glass, calcium carbide, and synthetic ammonia decreased by 17.2%, 16.8%, 13.8%, 13.3%, and 7.1% respectively. 

(II) Overall improvement in energy processing and conversion efficiency 

Compared with 2012, the energy processing and conversion efficiency of industrial enterprises above designated size increased by 1.8 percentage points in 2021. Among them, thermal power generation increased by 2.3 percentage points, heating system increased by 4.8 percentage points, raw coal washing increased by 3.2 percentage points, and coking increased by 1.5 percentage points. 

(III) Continuous decrease in energy consumption per unit of GDP 

In 2021, China's energy consumption per unit of GDP decreased by 26.4% compared with 2012, with an average annual decrease of 3.3%, which is equivalent to saving and reducing the use of energy by about 1.40 billion tons of standard coal. Among it, the energy consumption per unit of added value of industrial enterprises above designated size has decreased by 36.2% cumulatively, with an average annual decrease of 4.9%, which is 9.8 and 1.6 percentage points higher than the cumulative and annual average decline of energy consumption per unit of GDP, respectively, with remarkable effects in industrial energy saving. 

In recent years, the international environment and the global energy pattern have undergone profound changes. Impacted by factors such as the COVID-19 pandemic and geopolitics, there is increasing uncertainty and instability of the international energy market. Structural contradictions in the domestic energy market still exist, and energy security is facing new challenges. At the same time, the people's growing needs for a better life will also drive the rigid growth of energy consumption, and energy conservation and consumption reduction will face new challenges. The "14th Five-Year Plan" period is the first five years to embark on a new journey of building a modern socialist country in an all-round way and march towards the Second Centenary Goal. It is also a critical and window period for achieving carbon peaking. Guided by Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, we shall thoroughly implement Xi Jinping Thought on Ecological Civilization, follow the general direction of stable progress, implement new development philosophy based on the new development stage, build a new development pattern, promote high-quality development, and unswervingly implement the new energy security strategy of "four revolutions and one cooperation". We shall coordinate energy security and green and low-carbon energy transition, accelerates the construction of a clean, low-carbon, safe and efficient energy system, and provide a strong safeguard for the scientific and orderly promotion of carbon peaking and carbon neutrality. 

Note: 

[1] The data for 2021 in this article are preliminary calculations. 

[2] The data come from the China National Coal Association. 

[3] The data comes from the China Electricity Council. 

[4] The 2021 energy net import data by category in this article come from the customs bulletin data.