China Energy Statistics Comb-Over

by Bill Dodson

China would have the world believe its own statistics about energy consumption over and above the International Energy Agency’s own estimates that China has surpassed the United States as the largest energy consumer in the world. Chinese estimates, according to the Financial Times, are less than the IEA’s 2265m tons of oil equivalent energy use in 2009 against China’s own estimate of 2175m tons oil equivalent of energy. For a country with notoriously dodgy figures about everything from GDP through industrial output through unemployment figures and even the number of abortions each year, China’s statistics czars certainly have a lot of chutzpah.

Of course, with China’s Face at stake in its highly publicized goal of reducing energy consumption by 20% per unit of GDP over the five year period starting 2005, and with the deadline a mere five months off, the country’s leadership is loathe to present the society has failed in the attempt. Reuters reported the Chinese government recently revised its energy usage figures since 2005, showing an even steeper drop in energy consumption than previous re-calculations. Now, the Government claims energy intensity fell almost 16 percent in the past four years.

Frankly, as dramatic a drop in energy consumption in this economy is a near impossibility. The only time during the five-year period a substantial drop was measured was from the Spring of 2008 through the Spring of 2009, when the global economic downturn ate deeply into industrial production. During that time, as well, the Central Government’s efforts to cool an over-heated property development market had taken effect. The steel-production industry, as well, took a hit as over-capacity came home to roost and international demand for Chinese product took a hiatus. With the whiplash created by virtual stoppages of the export sector, concrete and steel production, it’s little wonder that Chinese energy consumption took the dip it did during the period. However, since Spring of 2009 all bets have gone off and the nearly US$2 trillion in bank funding dumped into the economy has seen energy consumption on the ground here in China at levels perhaps never before seen in the rest of the world: purchase and use of automobiles is way up over 2008, with annual growth in the double digits; and property development – commercial and residential – are like no time before in China, with most cities in China sprouting construction sites that work 24/7 to beat the next shift in government policy that could end the boom times on any day; and transportation infrastructure development projects sprouting out of the hundreds of murky corporations set up by local governments specifically to scoop up banking largess.

In other words, there is something seriously wrong with the measures, because it’s plain to see here in China everyday and most nights that China is far more energy-intensive and energy-dependent than at anytime in its modernization history. Perhaps it’s in the measure itself, or perhaps its in the way GDP is metered (where’s the real wealth generated from millions of empty concrete husks called apartments?); but one thing’s for sure: China is working hard to comb over the fact that it is as addicted as the USA to energy and is only becoming more so.

Further reading: FT, Reuters

For an insightful analysis of the way China is calculating its energy usage: Green Leap Forward

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