The following interview with Jennifer Turner  was carried out in Washington D.C., USA, January 13, 2014 by Patrick Renz and Frauke Heidemann. The main focus of the interview was on Chinese energy policy, environmental concerns and the water-energy nexus. All footnotes are remarks by Patrick Renz and Frauke Heidemann, aimed at giving some additional background knowledge and especially giving the links to the cited documents so that the reader can follow up on these issues easily.
. Chinese Energy Policy, the Environment and the Water-Energy Nexus
Do you believe the air pollution has started to affect Chinese policy making with regard to their increasing focus on natural gas usage and the push for more renewables?
I think it is helping to accelerate a trend that was already started. The Chinese government has started to become more concerned about pollution in general and the fact that coal production is facing a lot of challenges in particular. With Circle Blue and the China Environment Forum  we put that issue on the map in China. Did you know that the 10th Five Year Plan for Energy Development mentions the coal-water challenges and the Ministry of Water Resources just announced that it is going to enforce stricter allocation of water to the coal sector? When we went to China, we experienced a lot of different factors and international organizations pushing for cleaner coal and reducing CO2. This started back in the 1990s with the Energy Foundation, the Natural Resources Defense Council, and partnerships with the national labs in the U.S. But no one ever thought that they would take coal down as fast as they seem to be talking about it now.
That is where the airpocalypse  comes in – you didn’t see a lot of people in the streets protesting but the social media outcry was quite impressive. It has become evident how this is hurting the economy. Back in the early 90s, Elizabeth Economy  and others were talking on how the Party had internal discussions about how environmental degradation could be a source of threats to China’s economy and social stability. We have been saying this for years and now we are finally seeing the Chinese government agreeing that the cost for the economy is too high. They are however going back and forth on how many people die early every year from respiratory illnesses and are backtracking from the previously mentioned number of 1.2 million. But at the same time even if only 750’000 people are dying early ever year, it is still a pretty stark number.
Back to the water issue: Before we went to China three years ago and started talking about the water energy confrontation, this was not an issue. We talked to the water people, we talked to the energy people, we gathered the data and put it together. We found out that approximately 20% of China’s water goes to coal. Since then researchers say that it is probably more like 11% but this depends on how you set up your study. Even 11% for one industry is quite a lot and the numbers don’t always add up.
China’s overall water availability is starting to decrease. There is not even clarity on how much ground water resources they have. China’s bigger problem in terms of water supply however is not just drought but water quality. This is related to energy as it takes energy to clean water. We have been encouraging researchers trying to calculate how much energy goes or should go into cleaning water in China. If China really addressed its water quality problem, what would be the energy footprint? The Wilson Center is non-partisan and non-advocacy but I like raising hard questions to people working in the China Environment Forum network. Someone needs to think quite seriously about the fact that the water sector in China is an energy intensive sector. Think about the cement to build the dams, the energy needed for the water transfers, where are they going to get the energy to fuel those? Maybe they will look to nuclear power but this is not going to answer China’s broader electricity needs.
Where do you see the problem of affordability for energy in China? Do you believe that as coal is very affordable a shift away is less likely?
Look at Greenpeace and their studies about the true cost of coal. It is not just about the price of coal, which has gone up considerably, another important trend. Even though the prices have been increasing, there is furthermore the broader cost on society and the impact on the economy. Sometimes air planes can not fly and they have to shut down factories. This has to be calculated in when considering the cost of coal. From my point of view the economy could still bear the cost of coal going up a bit and it desperately needs to as so much energy is wasted despite the phenomenal strides China made regarding energy efficiency. This is another important trend to think about and the reason why when studying China your head hurts, is because they are all superlative big trends. China is the world’s largest coal producer, and has the largest energy intensity reduction. Everything is big but the pie chart you have to think about is that the electricity use doubled between 2000 and 2007 and it is doubling again by 2020. You can’t just double electricity use and not expect this to have consequences. How can you even talk about energy security?
All the Chinese can think about is supply, when ultimately the solution has to be demand-side management – more efficiency. The losses they have are enormous. Did you see our electricity on the move map? They are moving the power from the western parts to the coast. Even though the power loss is not as bad as in other countries, every movement leads to losses. This project is the poster child of supply side management. Now with the Pollution Action Plan of this September, they are going to move the coal-fired power plants west, the environment there will be destroyed and the transmission lines bring the electricity east.
A similar phenomenon can be seen regarding wind power plants, which are so far east.
The positive side is that China has developed these super transmission lines. The question is what is going to potentially help China? You are thinking about shale but I am thinking about storage. What if they could efficiently store some of this renewable power? The coal industry however is incredibly powerful in China. Additionally, the grid companies are used to working with the coal industry. In the U.S. some places have environmental dispatch, the coal-fired power plants that are burning most efficiently get to sell onto the grid first and if you are dirty it becomes more expensive. So you are pricing the access to the grid according to how clean the energy is produced. China is not doing that yet. But it is an interesting concept to think about.
There is an IHS CERA graph showing projections of coal use in China. The projection is that coal use will continue to increase but the increase will get lower. They are not talking about peak coal yet. How do you assess this?
I am hardwired to be an optimist. Even though people probably question my sanity that I can still be positive despite China’s pollution problems, changes that I have seen such as regarding the energy and climate legislation make that possible. Despite the implementation challenges, China has energy and climate legislation I wish we had in this country. The implementation is dodgy however. China is doing well on the energy efficiency and I think there is a window for China to get it right and to prevent even more horrendous environmental catastrophes, particularly regarding water and air. That window is getting narrower to make some really hard decisions, but the crisis, the airpocalypse was a good thing. We have also seen this in the U.S. and in England. Environmental regulation is all crisis driven and now China has its crisis. You can run but you certainly can’t hide. Now when I give talks in China, everyone has heard about the airpocalypse. I talk about the grey revolution in China. They have the potential to move in the right direction and my optimism comes from the fact that I have seen a lot of eco entrepreneurs in the private sector and government. Three years ago we started a conversation with Chinese water and energy researchers, the government, NGOs and businesses which have been doing research on this issue since then. We got them concerned and now they are doing research on the water-energy nexus. The Chinese are increasingly open to insights from and collaboration with international organizations. It is a trend that we don’t hear in the reporting outside of China. We mainly hear about the internet crackdown and of course there is this crackdown too. But at the same time you are able to research those issues in China. To you it is normal. I lived in China in 1987, they were opening our mail, they knew where we were, and they tracked us. It changed phenomenally. When I see those changes and this openness, it makes me optimistic. Things have to change and the environmental degradation is threatening economic growth, which is threatening social stability. Nothing motivates action faster and China is just more extreme than many other countries because it is at a scale and speed that the world has never seen.
Thank you very much for the interview.
 More about Jennifer Turner at: http://www.wilsoncenter.org/staff/jennifer-l-turner.
 More on the Circle of Blue at: http://www.circleofblue.org/waternews.
 The airpocalypse refers to the period in early 2013 when Beijing faced record level air pollution.
 Elizabeth Economy is C.V. Starr Senior Fellow and Director for Asia studies at the Council on Foreign Relations and especially known for her book „The River Runs Black: The Environmental Challenges to China’s Future. More on her work on Chinese foreign and domestic policy as well as on environmental issues can be found at: http://www.cfr.org/experts/asia-china-environment-us-china-relations/elizabeth-c-economy/b21/bio.
 An overview on the Woodrow Wilson Center’s Water-Food-Energy crisis in China at: http://www.wilsoncenter.org/sites/default/files/Four Pager_Circle of Blue_7c final.pdf.
 The Greenpeace study on the true cost of coal in China can be found at: http://www.greenpeace.org/eastasia/pagefiles/301168/the-true-cost-of-coal.pdf.
 Those predictions are largely undisputed by China: http://www.chinadaily.com.cn/business/201211/11/content_15911857.htm.
 China’s West-East electricity transfer project can be found on an interactive map at: http://www.wilsoncenter.org/article/map-chinas-west-east-electricity-transfer-project.
 Details on these new transmission line technology in China can be found at: http://www.greentechmedia.com/articles/read/a-next-generation-transmission-line-technology-grows-in-china.
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