Wednesday, July 28, 2010

United States Overtaken by China as World's Largest Energy Consumer

The Paris-based International Energy Agency, an intergovernmental organization that compiles research information about energy generation and usage, has announced that preliminary data show that China is now the world's largest consumer of energy. The U.S., which had for many years held the number one stop, dropped to number two.

According to the IEA:
"For those who have been following energy consumption trends closely, this does not come as a surprise. What is more important is the phenomenal growth in demand that has taken place in China over the last decade; also prospects for future growth still remain incredibly strong. Since 2000, China’s energy demand has doubled, yet on a per capita basis it is still only around one-third of the OECD average. Prospects for further growth are very strong considering the country’s low per-capita consumption level and the fact that China is the most populous nation on the planet, with more than 1.3 billion people.

"China’s demand today would be even higher still if the government had not made such progress in reducing the energy intensity (the energy input per dollar of output) of its economy. It has also very quickly become one of the world’s leaders in renewable energy, particularly wind power and solar energy, and paved the way for a big expansion of nuclear power."
The importance of this announcement was underscored by Fatih Birol, IEA chief economist, who told The Wall Street Journal ("China Tops U.S. in Energy Use," July 18, 2010) that China's rise to number one energy consumer marks "a new age in the history of energy"

However no sooner had the IEA made its announcement than the Chinese government denied its accuracy. According to the Financial Times ("Beijing Denies Energy Use Claim," China called the report "not very credible."

Regardless of whether the IEA report is completely accurate, all agree that China is now consuming enormously more energy than ever before and that the policy and economic implications associated with this development are huge.

In November the World Energy Outlook 2010 will consider the implications of these new trends.

Meanwhile, a story in The Wall Street Journal ("Chinese Firms Snap Up Mining Assets," July 21, 2010) reported on Chinese firms aggressive pursuit of mining assets. "In the global hunt for mining assets," the Journal reported, "China has emerged as the buyer to beat: Just a few years after suffering high-profile failures to close big acquisitions, Chinese buyers of all sizes are sealing more sophisticated deal deals at a higher rate of success."

China is one of the countries that is examined in the Sturm College of Law course "Comparative Environmental Law." China is also discussed in many other environmental and natural resources courses.

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