Newsfront
A better for
energy
balance
The nation is committed to GHG reduction and improved energy security,
creating opportunity for CPI companies
that can offer related technology or expertise
C
hina’s tremendous economic
growth and modernization has
propelled the nation to a posi-
tion where its consumption of
energy imports outpaces its economy.
As the world’s third-largest oil im-
porter, after the United States and
Japan, China imported a record-high
36.38-million tons of refined oil last
year, 15.7% more than in 2005, to fuel
an estimated annual economic growth
of 10.7%, reports China’s official Xin-
hua news service. Meanwhile, China
is one of the world’s largest producers
of carbon dioxide emissions, second
only to the U.S. So, with continued ex-
pectations of rapid industrial growth
in China, the nation is focused on ad-
justing its energy mix to prevent both
of these trends from escalating.
Since China is listed in the Kyoto
Protocol as a developing nation, it is
not bound to any particular green-
house (GHG) emissions-reduction
targets that apply to industrialized
countries that have ratified the proto-
col. During the formation of the Kyoto
Protocol, developing nations, such as
China, made the point that industrial-
ized countries, by comparison, contrib-
uted far more to creating the GHG-re-
lated problem and have more means
to contribute to its solution.
At the same time, though, “[China’s]
rise in greenhouse gases could easily
offset any reductions that would be
made by the European Union,” warned
Benita Ferrero-Waldner, the Euro-
pean Union’s head of foreign relations,
27-31 CHE 4-07.indd 27
during recent talks with Chinese For-
eign Minister Li Zhaoxing. And since
GHG’s are readily dispersed and long-
lived in the atmosphere, a ton of a
given GHG has the same effect on at-
mospheric concentration — and thus
on climate change — whether it comes
from Beijing or Hamburg. The bottom
line, Ferrero-Waldner added, “Neither
energy security nor climate change
can effectively be addressed without
China.”
According to Chinese officials, it
won’t have to. At the World Economic
Forum’s Annual meeting this Janu-
ary, Zhang Xiaoqiang, vice chairman
of China’s National Development and
Reform Commission (NDRC), stressed
that China intends to follow the Kyoto
Protocol, and urged speeding up ne-
gotiations and establishing concrete
emission targets. While China in-
tends to keep its emissions low, Zhang
pointed out that cement and steel pro-
duction in China are highly energy
intensive, and only around half as
efficient as technologies used in steel
mills in Japan, Europe, or the US, for
example. To meet its targets, Zhang
said, China would need help from the
industrialized world.
Consequently, China’s status as a
leading producer of greenhouse gases
is being viewed globally as more and
more of a business opportunity for for-
eign companies that can provide the
necessary technological innovation. In-
deed, in almost the same breath as her
warnings regarding increased GHG
Chemical Engineering www.che.com April 2007
China
emissions in China, Ferrero-Waldner
said that the EU was already working
with China on adopting new technol-
ogy to trap and store carbon-dioxide
emissions in coal-fired power plants.
Meanwhile, on the other side of the
Atlantic Ocean, U.S. President George
W. Bush recently used his State of the
Union address to emphasize the “criti-
cal role” for American technology and
innovation in reducing global GHG
emissions. Many such cooperative ex-
changes will undoubtedly be discussed
at next month’s AchemAsia, the 7th
International Exhibition-Congress on
Chemical Engineering and Biotech-
nology (May 14–18; Beijing, China),
organized by Dechema e.V., (Frank-
furt, Germany; www.dechema.de).
The attraction and potential impact
of such cooperation is already evident
in China’s participation in the Kyoto
Protocol’s Clean Development Mecha-
nism (CDM). The CDM offers a way
for industrialized countries to get
“credits” towards their own emissions
targets by funding sustainable devel-
opment projects in developing coun-
tries. As a developing country, China
has 164 projects either in existence or
in the planning stages with help from
around the globe, according to Lu
Xuedu, deputy director-general of the
office of global environmental affairs
at the Ministry of Science and Tech-
nology. In 2006, China’s GHG reduc-
tion was more than 40% of the total
reduction of the 40 countries involved
in the CDM, according to Xuedu.
27
3/29/07 7:06:17 PM
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Newsfront
Targeting energy efficiency
China has set a target of reducing
energy consumption per unit of GDP
by 20% for the five-year period from
2006 to 2010. The goal is aimed at
guiding China’s social and economic
development, but the country is al-
ready behind schedule. Official figures
from China’s NDRC show that in 2006
China failed to meet the 4% energy-
reduction milestone. In fact, China
witnessed an 0.8% increase in its en-
ergy consumption per unit of GDP in
the first half of that year, and indexes
for major pollutants have continued to
rise. In a national meeting mapping
out economic policies for 2007, China’s
central authorities recognized that
more efforts were needed to improve
energy efficiency in the country and
issued a stark warning to local gov-
ernments that are uncooperative in
the future.
Solid opportunities in cement
China is the world’s biggest cement
producer, according to government
figures, recording a production of
1.05 billion tons in 2005. The major-
ity of the production currently comes
from small factories, which are energy
inefficient and use out-of-date envi-
ronmental technologies. China’s 11th
Five-Year Plan (2006–2010) for the ce-
ment industry aims to shut down some
1,600 small factories, phasing out 250-
million tons of backward production
capacity. According to the Asia-Pacific
Partnership on Clean Development
and Climate — launched in January
2006 by Ministers from China, Aus-
tralia, India, Japan, Republic of Korea
and the United States — old technol-
ogy, primarily involving the wet-kiln
process, will eventually be replaced
in favor of dry processing technolo-
gies, energy-efficiency and process
improvements, power generation from
waste-heat recovery and enhanced co-
processing of low-grade primary fuels
and industry wastes.
State-of-the-art coal
China satisfies more than two-thirds
of its power needs from coal, which
produces approximately at least 75%
more carbon dioxide than natural-gas
derived power and generates signifi-
cantly more nitrogen oxides, sulfur
3/29/07 7:07:00 PM

oxides, carbon monoxide, particulates
and mercury per unit of heat. To meet
the country’s rising electricity de-
mand, a new coal-fired power plant
is built every two weeks in China. By
2010, China’s coal-output capacity is
expected to hit 2.45-billion tons, up
16% from 2005, to realize the goal of
an overall balance of supply and de-
mand. In 2005, China’s coal output
stood at 2.26-billion tons.
With the goals of accelerating tech-
nological modernization in the indus-
try and meeting projected growth in
demand, the Chinese government is
planning to establish five to seven
major coal producers over the next
five years. Each of the giants will have
an output capacity of 100-million tons
of coal annually under the proposals
in the country’s 11th Five-Year Plan.
The restructuring policies for the coal
industry worked out by the National
Development and Reform Commis-
sion allow for mergers, renovation and
regrouping of small mines. By 2010,
the output of large and medium-sized
coal mines should account for 75% of
the country’s total, compared with the
current 56%.
The Asia-Pacific Partnership on
Clean Development and Climate re-
fers to a range of advanced coal and
gas technologies with the potential
to significantly reduce air pollution,
including carbon dioxide capture and
storage, as well as advanced power-
generation systems. These include
integrated gasification combined cycle
(IGCC), oxy-fuel and post-combustion
capture. The partnership also cites
27-31 CHE 4-07.indd 29
ultra-supercritical pulverized fuel,
coal cleaning and treatment, poly-
generation, hydrogen production, en-
hanced coal-bed and waste coal-mine
methane, coal gasification and coal
liquefaction as other important ele-
ments of a cleaner fossil energy future.
Meanwhile, increased availability of
liquefied natural gas is also needed
to meet the rapidly growing need for
high quality, affordable and low emis-
sion fuel in the region.
A shift towards biorefineries
One of the major steps China is tak-
ing to address the escalating demand
for oil imports and increasing GHG
contribution is the new Law on Re-
newable Energy, which took effect on
January 1, 2006, with a stated goal of
increasing the use of renewable energy
to 10% of the country’s electricity con-
sumption by 2010. Meanwhile, China
has targeted a 10% ethanol gasoline
blend by 2010, which would amount to
a biofuel consumption of about 23-mil-
lion m.t./yr.
In the longer term, senior Chinese
officials have announced goals of re-
ducing the nation’s use of refined oil by
10 million tons, or more than 25%, by
2020 through the use of liquid biofu-
els like ethanol and biodiesel, Xinhua
reports. Shi Yanquan, deputy director
of the Ministry of Agriculture’s depart-
ment of science, technology and educa-
tion, says using crops and excrement in
rural China to produce biofuels would
meet the country’s growing energy de-
mands and boost rural economy. Apart
from liquid biofuels, the government
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Circle 24 on p. 82 or go to
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3/29/07 7:07:50 PM
 Newsfront

will focus on developing methane, com- ronmental advantages that it offers. In

pressed stalks for burning and oil-rich
crops in the next five to ten years, Shi
adds. The ministry plans to provide 40
million rural households with access
to methane by 2010, more than double
the number in 2005.
A fringe benefit of increased bio-
mass use in China is the related envi-
comparison to fossil fuels’ greenhouse-
gas contribution, biomass has a posi-
tive carbon-dioxide balance because it
is derived from renewable resources.
This is an important factor in the con-
text of the upcoming 2008 Olympics
in Beijing. China has pledged to stage
a “green” Olympics and is expected
to use the games to demonstrate the
vigor with which it has embraced re-
newable energy.
China’s biomass projects will be
funded, at least in part, by the Min-
istry of Finance, which has decided
to increase input in projects involved
in developing bioenergy and other al-
ternative energies between 2006 and
2010. The ministry has not elaborated
on the investment figures. The key
consideration for foreign investors who
wish to take advantage of government
funds and other development opportu-
nities provided within existing Chinese
laws and relevant well-defined regula-
tions is to maintain at least 10% Chi-
nese ownership in its joint ventures.
Such is the strategy outlined by Tiger
Ethanol International Inc. (Montreal,
Quebec) in its recent acquisition of
90% interest in Gallant Energy Inter-
national Ltd. The company’s business

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model focuses on the development of

facilities for the production of renew-
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stream fuels and chemicals at a single
facility. But in the meantime, the most
popular end-routes for biomass in
China are biodiesel, ethanol and PLA.

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programs, reports SRI Consulting’s

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com) late-2006 Biodiesel Report.
Only five years ago, the Asian
biodiesel industry in Asia was incon-
sequential in relation to the rest of the
world, according to SRIC. While there
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4.5% of the total), biodiesel capacity

Circle 25 on p. 82 or go to adlinks.che.com/6894-25

27-31 CHE 4-07.indd 30 3/29/07 7:08:50 PM

 be the first commercial plant to make
PLA using a process developed by
Uhde Inventa-Fischer (Dormat/Ems,
Switzerland and Berlin, Germany;
in the region accounted for less than ing what is claimed to be the world’s uhde.com).
1% of total world capacity. This has first fully continuous PLA plant at As China continues its quest for sus-
changed, with Asia accounting for Harbin Heilongjiang Province, China. tainable development, surely a wealth
7.8% of the world’s total biodiesel pro- When the 10,000-m.t. /yr plant starts of other “firsts” are to come. ■
duction capacity in 2005. At the end up in the second half of 2007, it will Rebekkah Marshall
of 2005, every second biodiesel plant
known to be operational in Asia was
located in China. According to SRIC,
China’s 2010 annual biodiesel output
from Jatropha oil is expected to reach
520 thousand m.t./yr while that from
recycled fats and oils, such as used
cooking oil and tallow, will reach 735
thousand m.t./yr.
Ethanol. Producing more than 4,525
thousand kiloliters/yr in 2005, China
is the world’s third-largest ethanol pro-
ducer, behind Brazil and the U.S. SRIC
estimates that there are more than 200
ethanol production plants in China.
SRIC expects the consumption of etha-
nol to increase at an average annual
growth rate of about 4% for solvent use,
about 5% for chemical raw materials
use and about 7% for fuels use over the
next five years. China’s aim to increase
the use of ethanol in automobile fuels
by 2010 is a major driver here.
PLA. Polylactide (PLA; poly lactic
acid) is a biodegradable polymer made
from renewable resources, such as corn
and other cereals. It is said to be the
biodegradable polymer with the high-
est market potential, with a current
global production capacity of 250,000
m.t./yr. PLA can be used for thermo-
formed packaging, bottles, fibers and
film, and for medical-engineering ap-
plications, such as sutures, screws and
bone-connecting meshes.
Demand for biodegradable polymers
in China has been rapidly escalating
as the problem of plastic waste has got-
ten more serious. China’s Solid Waste
Pollution Prevention and Control Law
encourages plastic film and dispos-
able package products that enable re-
duced solid waste. SRIC forecasts that
Chinese demand for environmentally
degradable polymers to continue to
increase at an average annual rate of
over 20% over the next five years.
One example of China’s important
role in the PLA landscape, Harbin We-
ilida Pharmaceutical Co. Ltd. is build-
VISIT US AT INTERPHEX, BOOTH NO. 3119
Circle 26 on p. 82 or go to adlinks.che.com/6894-26

27-31 CHE 4-07.indd 31 3/29/07 7:09:37 PM