China seeks its own model of sustainable development
In 2011, I attended the United Nations Framework Convention on Climate Change (UNFCCC) talks (COP17) in Durban, South Africa, as a nongovernmental organization observer. While slowing or stopping climate change was the agenda of the UNFCCC talks, the meetings were not really achieving this. It frustrated the G77 nations, which represent the new global consensus and which are developing nations that will either face massive desertification in the years to come or coastal flooding. In the case of island states, many will simply disappear. For them, the effects of climate change are real.
Realizing that there was no space for real progress in the big room where delegates were arguing over semantics, the two environmental think tanks Himalayan Consensus and African Consensus convened a side meeting together with the key negotiators from China, India, Brazil and several African countries in an attempt to build consensus on the sidelines of the UN talks.
In the meeting there was overall agreement that the survival of our planet depends on the total reduction of carbon dioxide (CO2) emissions. This requires government investment in infrastructure to convert grids from fossil fuel to renewable energy. Fiscal policies and rebates would be needed to encourage corporate investment in renewable energy to make it commercially viable.
All agreed that subsidies on fossil fuels (a pillar of American policy) should be withdrawn and that the three stakeholders -- government, civil society and business - must sit down at the table, working together for an achievable solution. At this side meeting, China's own chief negotiator Li Gao announced a huge financial commitment under its five-year plan that would accelerate this process. India seconded similar plans.
One year later in 2012, I was once again representing the NGO community as an observer at Rio+20, a UN climate conference celebrating the 1992 Earth Summit where the concept of "sustainable development" crystallized. At Rio+20 a debate erupted over the definition of a "green economy".
China's Premier Wen Jiabao was present with an entire delegation from the Climate Bureau of the State Development and Reform Commission. Leaders from developing nations all were present decrying the crisis with over 100 state leaders attending the summit.
Conspicuously missing were the leaders of the industrial West mostly associated with the crisis. Everyone was disappointed that key G7 individuals such as US President Barack Obama, UK Prime Minister David Cameron and Chancellor Angela Merkel of Germany shied away altogether. That says a lot about the agendas of each, and why there was such a sharp divide.
Ironically much of the mainstream Western media either did not bother covering this historic summit or simply played the whole thing down. By 2012, the idea that the "one percent" is calling all the shots had become a cliché. But at Rio+20, it was the problem.
Rio+20 fell short of expectations. The UN outcome document conspicuously dropped from the text any reference to the 2009 UN Conference on the Impact of the Financial and Economic Crisis on Development. The United States negotiators objected vociferously to even the slightest reference, as this strikes at the heart of America's debt-based stimulus bailout from the 2008 financial crisis that protected the financial interests of the one percent.
At Rio+20, most agreed that our current patterns and trajectories of consumption are not sustainable. If we are to keep going like this, then we will need seven planets to live on! Sadly, the divide between Washington's position and that of the rest of the planet was brought into sharp focus during the negotiations.
At the time of Rio+20, some 70 percent of China's energy came from coal. Hydropower and nuclear accounted for most of the remaining output, while renewable energy - mostly solar and wind - was a remarkably low 0.7 percent. That is not even 1 percent of the total! The reason is that in China, coal is cheap. To wipe out coal, upgrading and expanding the use of green energy could be viewed as both a challenge and an opportunity. The technology existed; however the only obstacle was to expand capacity, which would automatically reduce costs.
At Rio+20, China came to the table seeking solutions, not negotiations. Given its vast population, China was positioned to become the global leader on green energy solutions simply by solving its own pollution problems. In fact, all of the obstacles to the mass adoption of renewable energy as a nationwide priority can be viewed as industrial opportunity. That could be solved through fixed asset investment and green finance.
While in America, research and development were struggling to get costs down, in China the sheer volume of production could achieve this because everything occurs on a massive scale. The formula: When the solar panel reaches a cost of about $0.50/kilowatt, the total system cost will be about $1.00/kilowatt, which is about the same capital cost as coal, oil or natural gas power plants. This “learning curve” has had a historical ratio with costs dropping by 20 percent with every cumulative doubling of installed photovoltaic panels. Only China could achieve this. But it needed an overarching policy vision to do so.
Throughout 2013-2014, Beijing and most major cities in China were smothered in the worst pollution levels. The future of renewable energy in China became a question of political priority. In the past, economical success was based on GDP; now it would have to be based on repairing the environment. In the end, that means redefining what qualifies as success.
With macro-policy guidance, renewables as a national energy source could work. Economic policy and business opportunity follow. Moreover, as China's former Premier Zhu Rongji has clearly pointed out, "the social psychology effect on a herd of sheep" is key to the success of any economic policy. China faced the challenge of shifting from fossil fuels to renewable and efficient energy to drop total carbon outputs. Ironically, finance for fixed asset infrastructure investment, which in many ways was the cause of so much industrial pollution, could prove the solution to achieve a transition from fossil fuels to renewables on a scale unimaginable in any Western country.
For China, environmental economics was not about idealistic tree hugging. It was about the very survival of the planet, which should be at the core of any nation's own self-interest. That was the China challenge that the leadership would meet by introducing a policy called Ecological Civilization. It would become the Chinese version of sustainable development.
Please click here to read previous articles.