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Outsourcing the burden of coal to southeast Asia


One of the issues coming up in COP21 that I’ve seen has been around whether or not the sponsors of the conference are, themselves, reporting accurately and transparently on their carbon emissions.  In addition, concern has been raised that sponsors who are reporting are not being fully open about their full value chain; and that they are just passing on emissions to other countries where a portion of their operational or procurement activities take place.

This is not a new issue and not unique to the private sector; China (and other countries in the east) has carried the rest of the world’s demand for cheaper goods, evidenced by poor working conditions, terrible air quality, factory collapses, river pollution, etc etc.

Recent messages coming out of China have been around the need to address air quality concern, and China has come out strongly this year with commitments to reduce carbon emissions and increase the proportion of energy from non-fossil fuel sources.

This is particularly pressing as Beijing was subjected to horrific levels of air pollution on the opening day of COP21.  There have been some artistic responses to the air pollution in China.  One man vacuumed the air for 400 hours and used the dust as an input in the making of a brick.  Others have been drawing over photos in Beijing, where famous landmarks should be.

So China is waking up, and showing leadership in setting targets for renewables and the divestment from coal.  But as the west moved manufacture to the east, so the east is shifting its unattractive activities across borders.  International outsourcing.

I met someone yesterday who informed me of Vietnam’s plans to increase the contribution of coal in the local energy picture.  “Vietnam expects its domestic power demand to grow sharply, from 169.8 terawatt-hours (TWh) in 2015 to 615.2 TWh by 2030” [source] and the current plans are for coal to make up nearly 60% of the electricity mix (where coal is currently sitting at 29% of installed capacity and 36% of electricity energy mix).  As I mentioned in a previous post, carbon emissions have been on a steady rise over the last decade, and while Vietnam is committing to an 8% reduction in GHG emissions by 2030, this is against a business as usual baseline.

Which could mean anything if the baseline assumes massive economic growth, and the inevitable energy consumption increase assumptions that goes hand in hand with economic development targets.  The target above represents an increase of 260% in electricity consumption.  What’s an 8% decrease in GHG emissions compared to that kind of upscaling.

Whether or not Vietnam will be able to build the infrastructure to support this massive ramping in electricity consumption remains to be seen, but it’s reported that China has its eyes on helping them achieve this.  Moving coal power stations across the border means China can meet its climate targets and improve their air quality.  The CO2 and pollution issues then become something that Vietnam has to deal with.

And they are dealing with it already.  Air quality concerns and massive pollution from flooding is being seen in Vietnam.  Sensitive environments and heritage sites are being threatened by pollution.

So while we may laud China on their ambitious targets, we must not take our eyes off where the coal is going.  Vietnam’s CO2 emissions per capita are low, and they can hide a massive increase in coal facilities in those kind of numbers.  And they won’t be the only country in the region eager to increase their electricity capacity, their manufacturing capabilities.  If China is helping to foot the bill for this capacity, it may be incredibly difficult to say no to coal.

For those that are, like me, geographically clueless about the area, here’s a reminder of Vietnam’s location, relative to China.  They are neighbours.