Although the market is taking…
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Industrialisation has enabled economies in Asia to develop faster than ever, and this has shifted the balance of world energy consumption from the West to the East. China is by far the largest energy consumer, mostly driven by its huge manufacturing sector and infrastructural development projects.
Whilst the rapid growth creates opportunities, it also creates challenges for China. It now accounts for 30% of total world energy consumption, and has invested heavily in developing new sources of power generation.
Unfortunately the majority of this power, over 700GW, is coming from coal fired power plants, leading the country to use over 2.7 billion tonnes of coal each year, and produce the largest amount of carbon emissions in the world.
Aware that their carbon emission levels are too high they have set aggressive renewable energy targets, and installed massive amounts of renewable sources. China is the leader in carbon capture technology, and last year became the largest producer of electricity from wind farms; however it is still far behind, and cannot achieve the targets on its own.
China must look to import energy from other nations, and Russia is closer than any other major energy supplier. Both countries are aware of the potential relationship that exists in terms of energy supply and demand and are eager to take advantage of the riches available.
Russia has the second largest hydroelectric potential in the world and can generate more than 800 TWh each year, yet even so only about 20% of that potential is currently developed, with the majority of undeveloped potential in Eastern Siberia, close to China. However in this part of the world the level of energy infrastructure is poor, which hinders attempts to transport electricity between the two nations. Nevertheless the future energy cooperation between the two countries looks very promising.
By. Joao Peixe of Oilprice.com
Joao is a writer for Oilprice.com