By Matthew Acocella
Best Defense deputy bureau chief, East Asian energy bureau
The International Energy Agency announced last week that
China had overtaken the U.S. as the world's largest consumer of energy, citing
data showing that "China consumed the equivalent of 2.25 billion tons of
oil last year, slightly above U.S. consumption of 2.17 billion tons. The
measure includes all types of energy: oil, nuclear energy, coal, natural gas
and renewable energy sources." Chinese
officials moved quickly to dispute this assertion and questioned the IEA's calculations.
This pushback is predictable,
according to Fereidun
Fesharaki, Senior Fellow at the East-West Center and Senior Associate at CSIS.
At a talk at the Center for Strategic and International Studies last week
on "China and India's Energy Policy Directions," Ferashaki explained that China is loathe to take on the title of World's #1
energy user because it prefers the U.S. to be in the global hot seat. One
fact particularly struck me: according to Dr. Fesharaki, China purposely waits
until a lull occurs in the price of oil before it buys up large amounts for its
strategic petroleum reserves, in order to avoid being accused of spiking the
price of crude.
China's energy use is projected
to continue skyrocketing over the next decade. It is currently the
world's top emitter of global warming gases, but simultaneously investing the
most of any nation into developing green technology. Whether this investment
will yield any substantial emissions reductions over the next decade is up for debate. Critics note that
China's efforts at carbon-capture and sequestration, a process that strips out
harmful elements in released gases to be stored underground, is very expensive
and requires a large usage of coal to fuel the process. With China's economy still
developing, even substantial investments in clean technology may fail to bend
the curve of its
pollution.
Of course, China's energy needs
have other geopolitical effects. When it comes to China's relationship with
Iran in the wake of recent US sanctions and forthcoming EU ones... well, there's not
much top surprising there. China will continue to do business with Iran, even with delays and setbacks
caused by sanctions. "Despite political pressures, Chinese contractors could
invest more than $10 billion dollars in the Iranian oil and gas sectors in the
next few years," stated Ferekashi. Chinese corporations are also heavily
invested in other of Iran's domestic industries.
Iran is fortunate in that 60% of its energy use is domestically produced,
continued Ferekashi, which perhaps will allows it to withstand sanctions
longer. With China so heavily invested in Iran, will Sino-Iranian ties make
Iran sanction-proof?
In sum, there is plenty here for Western nations to grapple
with. China's insatiable thirst for oil and other
energy sources will make shedding any pretense of modesty necessary as it
becomes an increasingly aggressive player in the Middle East, Africa, and South
America. Furthermore, its willingness to partner with rogue states even
in the face of international pressure has the potential to undercut efforts to
impose sanctions on bad actors. If a superpower like China has no qualms
entering into agreements with the likes of Hugo Chavez and Mahmoud Ahmadinejad,
the U.S. will need in the coming years to develop policies and incentives to counter
these marriages of convenience.
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