“In 2019, my country’s natural gas dependence on foreign countries was 42.1%. As domestic demand will continue to grow, domestic production is difficult to increase significantly, and my country’s foreign oil and gas dependence will increase in the future.”
“The mandatory implementation of coal-to-gas and coal-to-electricity replacement has some side effects, so we need to change its mandatory implementation and operate it in a more market-oriented manner.”
The above are the views put forward by Han Wenke, senior consultant of the Energy Research Institute of the National Development and Reform Commission, on the current situation of my country's energy development and the direction of energy reform at the recently held 2020 Gao'an Ceramics Industry Development Summit Forum.
The “coal-to-gas” policy will eliminate the gas shortage among ceramic enterprises
In the new round of transformation and upgrading of the ceramic industry in recent years, clean energy transformation has always been a hurdle that cannot be avoided. The "coal-to-gas" policy in many production areas has caused major changes in the national ceramic industry pattern.
The end of September 2020 is the deadline for the "coal-to-gas" transformation of the ceramic industry in Jiangmen, Guangdong. Entering October, as the park with the most concentrated ceramic industry in Enpingsha Lake, companies that have not completed the transformation have been suspended for transformation, and companies that have completed the transformation However, it faced the limitation of insufficient gas supply and had to stop production.
This is not an isolated case. Qingyuan and Zhaoqing, which fully use natural gas for production in 2020, have encountered sudden "supply interruption" incidents many times, which has caused many problems to the normal production of ceramic companies and even caused serious losses. The most serious In mid-July, the Qingyuan Yuantan natural gas outage caused losses of tens of millions to 10 ceramic companies. So far, no unit has been held responsible.
The time can be traced back to Quanzhou, Jinjiang, and Nan'an, which were the first countries in the country to uniformly implement coal-to-gas conversion in 2014. At the beginning of the conversion, due to a serious shortage of gas supply and a sharp rise in gas prices, ceramic companies had to be allowed to re-burn coal for half a year.
2016-2017 was the craziest year for industrial enterprises in the country, including the ceramic industry, to switch from coal to gas. Ceramic enterprises in many production areas across the country were required to forcibly switch to natural gas, resulting in a nationwide disaster in the autumn and winter of 2017. There is a gas shortage. Zibo, Shandong Province has the highest gas price. The LNG gas price once exceeded 6 yuan/m³.
Although my country has since increased the supply of natural gas by increasing the exploitation and import of natural gas, serious gas supply shortages still occurred in various places in the early stages of gas conversion. This problem was mainly caused by insufficient design of the gas supply pipeline network.
With the improvement of gas supply capacity, ceramic companies are more worried about the monopoly compared with the high degree of marketization of coal.Excessive fluctuations in natural gas prices have caused high production costs.
Five “big” aspects of China’s energy national conditions
Oil and gas dependence on foreign countries will increase in the future
Han Wenke believes that China's energy development status can be summarized into five "big":
First, China is the world's largest energy consumer.
The total energy consumption is related to the population and the living environment. The second is related to economic development. Economic development is in the process of industrialization and urbanization, and the economy is large, so the total energy consumption is large.
In 2019, my country's energy consumption accounted for 24.3% of the world's total, the United States accounted for 16.2% of the world's total, and China and the United States together accounted for 40% of the world's total consumption. In 2010, my country and the United States were about the same. Since then, my country has been rising while the United States has been falling. The contribution of my country's energy consumption growth to the world's energy consumption growth accounted for one-third in 2018. In other words, one-third of the world's new energy every year was added by China.
Before the “13th Five-Year Plan”, my country’s energy consumption was dominated by coal, and coal’s proportion in primary energy resource supply has always been between 65% and 70%.
After the 18th National Congress of the Communist Party of China, my country's energy consumption structure has undergone tremendous changes. Since the "13th Five-Year Plan", driven by the energy revolution and energy transformation, my country's energy consumption structure has undergone great changes. The proportion of coal has dropped to 57.6%. By the end of the "14th Five-Year Plan" in 2025, the proportion of coal will drop to about 50%, a drop of 6 percentage points in five years. Clean energy is increasing. This is a historic change.
my country's total energy consumption is large, and its economy is the second largest in the world. Its per capita energy consumption is already among the 20% of the world's high energy-consuming population. More than 80% of the world's population consumes much less energy per capita than us. This shows that our total consumption is large and our per capita consumption is also large, which causes imbalance in the world.
Second, my country is the world's largest energy producer.
85% of the energy consumed in our country is produced by ourselves. my country is the world's largest coal producer, accounting for nearly half of the world's coal output. Our country is also the sixth largest oil producer in the world, with the top five being the United States, Saudi Arabia, Russia, Canada, and Iraq. my country is also the fifth largest natural gas producer in the world. In 2019, it produced nearly 180 billion cubic meters of natural gas. The United States, the largest, produced 900 billion cubic meters.natural gas, Russia, Iran, and Qatar are also increasing.
Global natural gas production is now nearly 4 trillion cubic meters per year and remains a growing energy source.
Third, my country is also the world's largest energy importer.
In 2019, my country consumed 700 million tons of oil, of which nearly 500 million tons were imported, which is larger than any other country. Natural gas imports are also relatively large. In 2019, my country imported 130 billion cubic meters of natural gas. Adding my country's production of 170 billion cubic meters, the usage is nearly 300 billion cubic meters.
In 2019, my country's oil dependence on foreign countries was 72.6%, and natural gas's foreign dependence was 42.1%. As domestic demand will continue to grow, it is difficult for domestic production to increase significantly, and my country's dependence on foreign oil and gas will increase in the future.
Fourth, my country is the world's largest country with energy and environmental problems.
We consume a lot of energy, so the amount of various pollutants emitted from energy consumption, production, processing, and transportation is huge. Large emissions cause air pollution, ozone pollution, dust, acid rain and other natural disasters.
Fifth, my country is the world's largest emitter of greenhouse gases.
How big is our country’s emissions? The carbon dioxide or greenhouse gases emitted by global energy consumption account for more than 70% of global greenhouse gases, and the carbon dioxide emitted by our energy consumption accounts for 28% of the global total.
Coal to gas, coal to electricity
Market-oriented operations are needed, and pricing needs to be refined
Han Wenke introduced that since the 18th National Congress of the Communist Party of China, my country has had a set of policies to promote energy transformation, mainly related to haze control and clean energy. From 2016 to 2018, coal production capacity will be reduced by 800 million tons.
The most important thing in the energy production and consumption revolution is to continuously increase the consumption of clean energy and reduce the production and consumption of non-clean energy. There is an institutional arrangement here, that is, the new energy demand mainly relies on clean energy. It is also necessary to replace part of the stock, and some parks have to use clean energy to replace unclean energy. This is already a national system.
In order to promote the energy revolution on the consumer side in recent years, the country has replaced coal and oil with electricity. Now it has also proposed that "power comes from all around" and develops clean energy locally.
Han Wenke believes that during the "14th Five-Year Plan" period, our country must first pay attention to energy security, which is a key issue, and mainly implement the overall national security concept in the energy field.
The most important aspects of energy security in our country are:
First, we must use the overall national security concept to crack the United States’ absolute security concept.
Why are China and the United States confronting each other? The United States believes that it is a global country after World War II. It has a global mission, global interests, global power, and global power, so it cannot allow others to compete with it. Therefore, it is based on absolute security and does not need opponents. However, what China values is common security, which will be tempered during the "14th Five-Year Plan" period.
Second, our country will make greater efforts to develop clean energy, including replacing coal with gas and coal with electricity.
Why speed up? my country's energy structure has undergone huge historic changes during the "13th Five-Year Plan", but the emission reduction requirements of developed countries are still far behind. If accelerated, relatively clean goals can be achieved by 2030. This is not only a matter of energy changes, but the most important thing is to maintain the pattern of my country's reform and opening up, to make our country's real economy, and to enable products made by major manufacturing countries to sell well around the world.
my country has had more contact with the EU recently. We are closer to the EU in manufacturing concepts in order to prevent the EU from imposing trade barriers on us in the future. This is also related to economic and social development.
So, China's current use of cleaner energy is not only a matter of energy security, but also a matter of whether an industry can go abroad and be accepted by the world. Therefore, the country must vigorously develop renewable energy.
Third, traditional energy sources will undergo in-depth adjustments during the "14th Five-Year Plan" period.
my country's GDP growth is greatly restricted by the growth of energy consumption, which is what the "14th Five-Year Plan" will reverse. Coal has also rebounded in recent years, and the reduction will be further intensified during the "14th Five-Year Plan" period. Therefore, the country must strictly control the consumption of fossil energy.
In the meantime, traditional industries can be transformed with information technology to realize smart coal mines. There is also a lot of room for the ceramic industry to achieve more refined development.
The country has also established various models. In the model system, the forced implementation of coal to gas and coal to electricity has some side effects, so it is necessary to change its mandatory implementation and operate in a more market-oriented manner. Judging from the examples of various countries, fuel switching is difficult. Incremental costs need to be channeled and prices must be refined.
(The article is reproduced from Ceramic Information)
