China overtook the U.S. last year as the world’s biggest energy user, according to the International Energy Agency.
China consumed 2,252 million metric tons of oil equivalent in 2009 in the form of crude, coal, natural gas, nuclear power and renewable sources, an agency report said. That exceeded the 2,170 million tons used by the U.S.
“It’s one of those major turning points,” Tilak Doshi,the chief economist at the Energy Studies Institute at the National University of Singapore, said in a phone interview. “China is growing by leaps and bounds. You’ve got [Organization for Economic Cooperation and Development] countries where you’retalking about oil demand peaking; meanwhile the emerging countries like China and India will keep growing their energy demand.”
China’s gross domestic product expanded 10.3 percent in the second quarter even asthe government took measures to cool growth. The agency’s report echoes BP Plc’s annual Statistical Review of World Energy, which in June said China, with Hong Kong included, was the biggest energy user in 2009, consuming 2.2 billion tons of oil equivalent. The U.S. was second and Russia ranked third, BP said.
“As China overtakes the U.S. as the world’s largest energy consumer, it is not only a domestic issue for China but has repercussions for the rest of the world not only in supply terms but also in how the energy is consumed,” said the International Energy Agency’s chief economist, Fatih Birol. “If China uses electric cars, hybrids and so on, they will impose the manufacturing line on most of the rest of the world.”
The agency’s data are “not very credible,” Zhou Xi’an, head of the National Energy Administration’s general office, said at a news conferencein Beijing.
“When the IEA came to China to publish its energy outlook a couple of days ago, they also overestimated China’s energy consumption and carbon dioxide emissions,” Zhou said. “We think that’s because of a lack of knowledge about China, especially about China’s latest developments of energy conservation and renewable energy.”
At the same time that China increases its use of fossil fuels, it is funding renewable energy projects. The nation may spend about $738 billion in the next decade developing cleaner sources of energy to reduce emissions from burning oil and coal, Jiang Bing, head of the National EnergyAdministration’s planning and development department, said in Beijing.
China’s oil imports gained 48 percent last year and have almost doubled since 2005, according to customs data. The nation increased net crude imports to a record 22.1 million tons in June, or about 5.4 million barrels a day, customs figures show.
Global oil supplies will become “tighter” after 2015 as a result of declining production outside the Organization of Petroleum Exporting Countries and growing control of reserves by state-run producers, Birol said.
The U.S. remains the largest oil consumer, using 843 million tons in 2009, more than double China’s 405 million, according to BP. China burned 1,537 million tons of coal last year, compared with 498 million in the U.S., BP said.
The reliance on coal saw China surpass the U.S. in carbon emissions in 2007, according to the U.S. Department of Energy. China released 6.533 million tons of carbon dioxide in 2008, compared with 5.832 million for the U.S.
The International Energy Agency’s 2010 World Energy Outlook on supply and demand through to 2035, to be released in November, will focus on three particular topics, Birol said.
These will be the cost of renewable energy sources; costs faced by the energy industry after the failure to reach an accord in Copenhagen; and the diversion of oil supplies in the Caspian Sea region from Europe to Asia.
The agency is an adviser to 28 developed nations, all of which are also members of the Organization for Economic Cooperation and Development.
Business, Pages 19 on 07/21/2010