China’s Dependence on Coal

Chinese coal is among the most polluting in the world with a high sulfur content that is destroying the quality of winter air in cities across China while also impacting other areas of the world. Air pollution from China is present along many parts of the western coast of the United States Yet, despite previous pledges, after this year’s COP26 conference which ended last week China is refusing to reduce the amount of coal it uses. Repudiation of the conference agreement will dramatically impact whether the world can reach its goal to cap global warming, according to US officials. This was despite China’s instance of a last-minute change to the agreement that reworded it from “phase out” to a “phase down” in the use of fossil fuels. China also refused to sign a pledge to stop building new coal-fired “unabated” plants. These types of projects in the US and elsewhere require carbon recapture methods to reduce air pollution.

Coal supports 57% of China’s energy consumption and generates 70% of the country’s electricity. Today it operates just over half of the entire world’s operating coal-generating plants. Zhao Lijian, a spokesman for China’s Ministry of Foreign Affairs, pointed out on Monday that China is making “incremental changes” in its coal usage. In reality the country will not be initiating a coal reduction program until at least 2026. In part this is due to the number of newly built coal-fired plants that still have a long lifespan. Zhao said that these plants can operate through at least 2040.

As the world phases out the use of coal China is facing a shortage and scrambling to obtain more supplies for this winter. It is negotiating long-term contracts with Moscow to develop new coal deposits in Russia and buy additional supplies that it considers critical to its economic modernization programs. The coal crisis may serve to push the two communist giants closer together as it forms a win-win situation for both – simply put Russia needs money and China needs coal. According to Russia’s Deputy Primte Minister, Alexander Novak, “New long-term contracts will be considered in this regard, along with joint development of coal deposits in Russia, the Zashulanskoe coal deposit in the Trans-Baikal region in particular,” which is in eastern Siberia.

China’s coal demand and increased need for LNG is raising the cost of energy in Europe this winter, further stressing global supply chains, and creating strained relations among the large economies attempting to recover from the global pandemic. According to Jack Sharples, an expert at the Oxford Institute for Energy Studies, “The global energy price rally has affected economies all over the world, as the prices of oil, coal, and gas have risen.”

Chinese imports of coal from Russia have tripled compared to last year, according to Chinese customs data. “The rising cost of natural gas has also given Moscow and Gazprom, its state-run gas company, additional leverage over Brussels as it pushes for final approvals for its new and controversial Baltic Sea gas pipeline to Germany, Nord Stream 2, which will bypass Ukraine,” according to Reid Standish of Radio Free Europe.

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Chinese imposition of an unofficial ban on the importation of Australian coal has further exacerbated the energy crisis in China. It also added stress to Central Asian coal producers who are unable to increase production in the short-term due to the logistics of transporting larger quantities. Constraints on the coal supply have caused China to increase its purchases of foreign LNG. Beijing has ordered state-run companies to buy energy at the highest premium costs, if necessary, further driving up global supply costs and constraints.

Russia now exporting 60% of its production of oil and gas to China. According to Standish, “Russia also is looking at how to ramp up its coal supplies to China and is currently investing $10 billion into railroad infrastructure in its Far East in order to meet future Chinese needs before the country progresses on its transition to alternative energy sources. It appears that it may be a cold winter not only in China, but in many other areas of the world with diminished long-term prospects for improving air quality.

DARIA NOVAK served in the United States State Department during the Reagan Administration, and currently is on the Board of the American Analysis of News and Media Inc., which publishes usagovpolicy.com and the New York Analysis of Policy and Government.

Photo: Pixabay

Quick Analysis

Ukraine’s Frozen Conflict

As we approach winter in the northern hemisphere, the war in Ukraine is beginning to resemble a “frozen conflict” from many perspectives. Ukrainian President Volodymyr Zelensky recently told the media he hopes the war will end faster once President-elect Trump takes over in January. Opinions in Moscow, however, differ from that of the Ukrainian leader. Russian President Vladimir Putin argues that the North Atlantic Treaty Organization (NATO) needs to exclude Ukraine from joining in “exchange” for peace. If it does not, he says, then no end to the war is in sight. So far there is no Christmas solution. Several NATO countries, according to Vladimir Socor of the Jamestown Foundation, are tentatively considering “coalitions-of-the-willing” to provide security for Ukraine outside of the formal NATO framework. There is, however, no collective mechanism today under which such an arrangement is viable. According to the NATO Charter, while Ukraine is a NATO partner country, it may not join as a full member since it has not fulfilled the requirements for membership. That has not stopped NATO and allies from continuing “to provide Ukraine with unprecedented levels of support, helping to uphold its fundamental right to self-defence,” according to the organization. Socor says that keeping Ukraine out of NATO will not advance peace with Russia. Waiting for a peace settlement, he suggests, would only serve to encourage Moscow to continue the war indefinitely. Although the Biden Administration officially withdrew its support for Ukrainian membership in 2021, NATO maintains an “open door” policy toward membership-seeking countries. The current White House position led the way for European states to oppose Ukraine’s membership saying that a decision should be delayed until “conditions are met.” Biden pushed for changing “open door” to a “bridge” metaphor. It is not intended as an across-the-board NATO policy and has been implemented in the past on a case-by-case basis, says Socor. “The alliance’s open-door policy was not fully insulated from Russia’s non-statutory blocking power, and NATO-aspirant countries’ path toward membership was not always irreversible.” Russia has successfully blocked states like Georgia from joining, first in 2008 and again after the war in Ukraine began in 2014. Russia recognizes the value add of Ukraine to NATO is enormous and that Kyiv has a better case than some other nations. Putin’s invasion was, in part, intended to foreclose that option. By 2021, Moscow was pushing hard to maximize its war objectives, which included further annexations of Ukrainian territory. A main goal for Putin was, and is, to ensure there is no Ukraine left to join NATO. As President-elect Trump prepares to assume office in January, he is faced with the historical challenges presented by the war. Post-conflict security guarantees were the center of several proposals made during the 2023 military stalemate. The incoming Trump Administration has yet to outline how it intends to handle the Russia-Ukraine war. Analysts in Washington believe that the new Administration will expect its European allies to guarantee the majority of Ukraine’s security needs. As we approach 2025, several European nations have acknowledged that they do not view Ukraine as eligible for NATO membership as it would draw the organization into the middle of the conflict. Others want to wait until the war is over or pending a “peace” settlement before considering Ukrainian membership. Socor reports that some “influential voices” are suggesting that “Kyiv should join NATO after “freezing” the war along a stable armistice line, de facto accepting Ukraine’s partition, with NATO security guarantees applying de jure to the government-controlled territory only.” This would mean starting accession talks soon with the actual talks to commence only after a ceasefire is in place. Trump arrives in Washington at a time when Putin’s hybrid strategies of war in Ukraine have eviscerated commonly-held differences between war and peace. “Absent a political consensus in NATO over Ukrainian membership, certain European allies, including France’s President Emmanuel Macron, are holding informal consultations about post-conflict security guarantees to Kyiv by NATO members outside of NATO’s framework,” according to the Jamestown Foundation. The Biden Administration downplayed the discussions on possible forms of military assistance and defense industry cooperation by sending only an Assistant Secretary of State. For a European peace to hold the Trump Administration would need to formally extend the United States’ nuclear deterrence to Ukraine. Options under discussion in Europe include a “coalition of the resolute” to deploy forces to Ukraine as part of a possible armistice package, deterring further Russian attacks, says Secor. European officials are also debating, without any agreement, whether its military forces could perform non-combat logistical roles to free Ukrainian forces to fight. None of the possible courses of action has moved forward as all eyes are waiting on the incoming Trump Administration for clues about its intended level of support for a NATO framework and other non-NATO proposals. Daria Novak served in the U.S. State Dept.