This will have a big effect in their economy. Many small oil producing businesses are going to feel the pressure. China is also trying to lower inflation at the moment. I feel that if this policy does get approved, this will cause the price of coal to rise. The loss of job and prices to go up is the last thing China wants.
Thursday, November 18, 2010
Coal Cap on China?
As we all know, China is major producer and consumer of coal. According to the Wall Street Journal, the demand for coal in China has gone up 10% and it's share of the global coal consumption has already tripled. Zhang Guobao, head of China's National Energy Administration, doesn't approve of this, therefore calling for a cap somewhere between 3.6 million tons and 3.8 million tons. China is currently consume over 4 million tons. They predict that China will run out of coal in 28 years, but they aren't sure about it since it's really difficult to compute. For a country that depends on coal fro 70% of their energy, this could be a major problem,
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I see how a cap may seem hard to impose, but China needs to find a way to support themselves further into the future without coal based energy. One promising endeavor may be using hydraulic power from dams and waterfalls. The largest manmade dam on earth is Three Gorges Dam, and it produces energy for a number of provinces in China.
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