China’s energy revolution in the context of the Global Energy Transition
Shell International B.V.
The Development Research Center (DRC) of the State Council of the People’s Republic of China
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In June 2014, at a conference of China’s Central Leading Group for Financial and Economic Affairs Commission, General Secretary Xi Jinping launched the idea that China should initiate an energy revolution. The revolution would be comprehensive in scope. It would encompass demand, supply, technology and the energy system itself, and it would strengthen international cooperation and guide China’s energy reforms. As part of this reform process, the Development Research Center (DRC) of the State Council of China and Shell International, building on their long-term collaboration, started a joint research programme on China’s Energy Revolution in the Context of the Global Energy Transition in late 2015. The research focuses on how to promote China’s energy revolution by reforming the energy system, bolstering innovation policy and motivating all stakeholders, including government, industry, companies and citizens. Our findings show that China will learn from international energy transition experience and strive to improve and build a modern, high-quality energy system. This will improve people’s living standards, help make China a high-value manufacturer, protect the environment, and drive China’s economic development. In short, China will provide high-quality energy for high-quality growth. A high-quality energy system should have the following three features. First, energy should be clean and low carbon. The entire energy life cycle— from production and conversion to transmission and consumption—should be low pollution with minimal emissions of harmful local pollutants and with CO2 from energy production and consumption minimised. Second, energy should be efficiently priced and affordable. China has not yet completed its industrialisation process and is still in a critical period of upgrading the manufacturing value chain. As energy is a key component of production and circulation, the price of energy should be competitive internationally and bolster Chinese manufacturing. Third, energy should be secure and reliable. The energy system should guarantee basic and stable supply, even during abnormal conditions like natural disasters or geopolitical tensions. It should also be sufficiently flexible to integrate ever-increasing volumes of renewables in the energy mix.
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