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At the fourth “Energy, Power, and Development†forum, Zeng Yachuan, Director of the Department of Policies and Regulations at the National Energy Administration, highlighted that China's energy development is currently facing significant challenges across six key areas. As the country moves toward building a moderately prosperous society in all respects over the next eight years, the pressure on energy reform and development is immense. Without substantial reforms and a shift in development strategies, it will be difficult to meet the critical goal of supporting this national transformation.
The first contradiction lies in the growing internal demand versus rising external pressures. With China’s per capita GDP surpassing $5,000 last year, the nation is at a crucial stage of industrialization and urbanization. By 2020, the urbanization rate is expected to reach 60%, adding over 160 million urban residents—driving up future energy and electricity consumption. However, globally, developed nations achieved similar economic growth with much lower energy consumption increases. For example, the U.S., Germany, France, Britain, and Japan saw only modest rises in energy use during their growth phases. Now, as China becomes the world’s largest energy consumer, accounting for over 20% of global usage, international competition for resources is intensifying, making energy access more challenging.
Another key issue is the imbalance between fairness and efficiency. Although China’s per capita energy use has reached the global average, there are stark disparities between urban and rural areas, with many regions lacking basic energy services. Additionally, China’s energy efficiency remains low compared to both developed and developing countries, leading to significant waste. Improving efficiency and ensuring equitable access could unlock substantial potential in the energy sector.
The third contradiction involves the structure of the energy mix and its impact on security. Coal still makes up 70% of China’s primary energy supply, contributing significantly to energy security but also causing environmental damage. While increasing reliance on oil and gas might reduce coal dependence, it would heighten foreign energy dependency, posing risks to national security.
There is also a tension between quantity and quality in energy development. China leads globally in production and installation capacities for various energy sources, but technological innovation and self-reliance in key equipment remain limited, with many technologies still imported.
Furthermore, the scale of China’s energy system outpaces its management capabilities. Despite being the second-largest economy, the country’s energy infrastructure and management systems lag behind its status as the world’s top energy user. This mismatch creates inefficiencies and challenges in governance.
Lastly, regional inconsistencies add to the complexity. Local governments and departments continue to prioritize growth, which puts pressure on energy supply. Yet, some regions already have high installed capacity but lack environmental capacity, while nationally, controlling total energy consumption is urgent and necessary.
Zeng emphasized that addressing these contradictions is essential to ensure sustainable energy development and achieve the dual goals of building a well-off society and a beautiful China. The need for comprehensive energy reform has never been more pressing.
China's energy development faces six major contradictions