China To Close 2,000 Factories In Energy Crackdown
Hugh Pickens writes "The NY Times reports that China's Ministry of Industry and Information Technology has published a list of 2,087 steel mills, cement works and other energy-intensive factories required to close by September 30 after discussions with provincial and municipal officials to identify industrial operations with outdated, inefficient technology. The goal of the factory closings is 'to enhance the structure of production, heighten the standard of technical capability and international competitiveness and realize a transformation of industry from being big to being strong,' the ministry says. The current Chinese five-year plan calls for using 20 percent less energy this year for each unit of economic output than in 2005 but surging production by heavy industry since last winter has put in question China's ability to meet this target. In addition to the energy-efficiency objective in the current five-year plan, a plan announced by President Hu Jintao late last year called for China to reduce its carbon emissions per unit of economic output by 40 to 45 percent by 2020, compared with 2005 levels."
The $€£ is still king.
No sig today...
Even though I didn't really expect China to do things like this (at least this early), it looks like they're willing to raise the standards of their production at the cost of business; something that most "western" societies have been doing for some time (and hence why they now import these goods from countries willing to produce from the cheap labor and lax restrictions).
If this continues, it will slow their growth. Some other country will be able to produce the same things China has without these same restrictions. I know people talk about India being similar or replacing China in this regard, but won't India follow a similar path of cleaning up their own "manufacturing ethics" as they grow? What happens when *all* countries have tighter manufacturing limits in place?
Earlier this summer, Prime Minister Wen Jiabao of China promised to use an “iron hand” to improve his country’s energy efficiency,
While less energy/carbon intensive as the steel, to get the iron for the hand he'll still need to use carbon. Consequence: his grip on the problem will very likely be 20% softer to the end of this year and about 40% softer in 2020.
Questions raise, answers kill. Raise questions to stay alive.
In other terms, China's authorities make it a compelling demonstration that unregulated free trade and laissez-faire is unable to find any kind of economic optimum, at least in this kind of rapid growth situation. So much for Chicago boys...
I prefer to think of it as "devil's advocate"...
No sig today...
Whenever I read the news every new fuel consumption target or windfarm a politician tries to introduce is beaten down by the auto manufacturers or hordes of NIMBYs. Maybe they are raising standards but it's going to take an *awful* long time for things to improve at this rate...
No sig today...
To make the air in China breathable?
Last time I was in Beijing a few months ago, you could cut the air with a knife.
I was there for a short time, but I am sure the glorious leadership is starting to feel uncomfortable with the noxious fumes.
Has anyone based there experienced brownouts or electricity stoppage?
Its very shortsighted of us in the west to give this whole area of development to the Chinese. As they get more efficient and starts getting good at using alternative energy we in the west will still fight about oil, coal and other forms of non renewable energy.
The future lies at the feet of whom have energy in wast amounts. If China wins this race, they win in the long run. I wouldnt be surprised if we end up paying royalties to China for their technology instead. Some politicians cling to the idea that the west will supply the brains and the rest of the world will pay.
Our greed comes back to bite us over and over.
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If you want to see why America is in such deep trouble, just look in the mirror.
Did you vote for G.W. Bush not just once but TWICE?
Do you oppose any meaningful energy policy (like a large tax on petroleum) despite the fact that it sends HUNDREDS OF BILLIONS YEARLY to countries which hate our guts? (and support terrorism?)
Did you oppose health care reform because of "death panels" and "socialized medicine" despite the fact will SAVE money (extending Medicare 12 years), provides many new benefits as well as extending coverage to many millions?
Did you think the government's bailout of GM was a plot to take over private enterprise? (GM is now planning an IPO).
Do you think that Global Warming is a giant hoax perpetrated by virtually the entire climate science community? (These scientists are the same people who brought us things like electricity, jet planes, anti-biotics, computers, cell phones, etc. Realize that scientists can, and do switch and work in different fields).
Do you doubt Evolution, despite being THE lynchpin for the biological sciences ("without Evolution, nothing in Biology makes sense")
Do you doubt Obama's citizenship despite the fact that he (and not McCain!) was born on American soil.
If you answered yes to these questions, I think it is clear where the problem lies: YOU.
I am no fan of China, years ago I divested my holdings (despite some serious profits) because of their policies towards things like Tibet and North Korea (supporting a brutal regime that is destroying the lives of tens of millions just to keep America off its doorstep). However, their direct and bold actions such as closing these plants mirror some of their other enlightened policies (such as their huge investments in renewable energy sources that will make them the leaders in that technology). Maybe they really are "the Harvard Alumni association with an Army".
So what do you prefer; an authoritarian state that tramples on the rights of its citizens but has (some) wise long-term policies or the "idiocracy" where everyone is entitled to an SUV and does things that are, idiotic, both for themselves and for the world?
I no longer login because I feel that while attacking a company's products is fair game (specifically Apple), having stories singling out their users as "selfish" and unkind is not "news for nerds stuff that matters". Am I an Apple fanboi? Let's just say I've used NIX for decades (yes I'm old) and I'm not talking OS X.
but China could have simply raised the tax on energy to push those inefficient industries out of business -- either because they rely on cheap energy (concrete) or because they're being out-competed by more efficient factories elsewhere (outdated, inefficient technology). Places with the $€£ could most certainly increase the tax on various energy sources to generate the same factory-closing result. It would have other results as well (everyone consuming less energy, a redistribution of wealth, etc etc) which may or may not be attractive for a given populace.
So yeah, the implementation of their policy reflects statism vs. democracy. The policy goal itself (reduce energy to GDP ratio) could certainly be attained by a democratic nation with democratic policies -- using taxation or carbon pricing.
Support a few technologists in Washington.
Anyone get the feeling the Chinese are behaving as if engaged in a game of Civilization, while the US is played more like a game of Monopoly?
In the U.S., the President would give a speech about the importance of energy efficiency, Congress would pass some token tax rebates, Democrats and Republicans would end up deadlocked in am ugly partisan fight over anything more meaningful than that, and nothing more would ever get done. In fact, that's pretty much what HAS happened in the U.S.--many times, over the course of pretty much every Presidency going back at least as far as Nixon. Guess there are some real advantages to a oligarchy over a democracy.
SJW: Someone who has run out of real oppression, and has to fake it.
What is there power gird like? any thing like the us one that was lots of old parts that need to be rebuild? If so adding wind and sol is not that easy.
Are they big on nuke plans there? or the old COAL.
they need crack down on air pollution as well!
While not exactly staged liked the US vs USSR during the cold war, an economic battle between the worlds top producing (and consuming) countries would be the best thing we could ever hope for. IE- countries battling to be the most energy conscious or "greenest" or most efficient.
An economic battle like this, of course, would require consumers to push it, of course, although it wouldn't necessarily be based on cost, but on "feel-good-ism", and that's a hard sell...
If you are tossing around Kyoto as what needs to be done this means one of two things:
1) You are not very well informed about how it actually works, and how nations are doing with it. You are being an idealist about it, not considering the reality.
2) You just dislike the US, and figure they should suffer.
The reason I say this is because Kyoto is completely worthless. Not just because certain nations are exempt, but because the nations who have signed on don't have to give a shit either. Any nation can walk on it at any time, no consequences. So what you see is places like Russia, who's economic collapse has made it easy to meet Kyoto goals patting themselves on the back about it, for now, and places like Canada just ignoring it. What, Canada, one of the driving forces behind it? Yep. Canada has been doing jack and shit to meet its Kyoto commitments and as such is considering simply bailing on it (http://www.thestar.com/news/canada/article/709146--canada-s-kyoto-view-triggers-a-walkout).
Kyoto is a sham, a way for politicians to pat themselves on the back and accomplish nothing in the long run. The US is just one of the few nations that wasn't hypocritical about it and just refused to sign on. Perhaps this is simple politics (though the Senate voted it down 98-0 when it came up, they have to ratify treaties by US law) or perhaps it is because US law places a higher weight on treaties than some places, or perhaps it was simple pragmatism. Whatever the case that the US isn't signed on to Kyoto just means they are being honest about it.
Man, their economy must just be screwed with all of that government interference! I'm sure glad their economy will be dropping off a cliff any day now!
That is all.
Always fun to see stories like this... the authoritatian greens can't help but applaud and criticize the West for not being more autocratic like China.
I believe 10% of China's energy consumption is to make steel or cement - or is it 10% for cement alone?
If they can do something about this, then they can really clean up. They sure need lots of steel and cement - floods mudslides and earthquakes are not going away.
Interesting to note they identified they least efficient plants - something the WEST would not dare to do -
oh no you can't do that in Cleavland.. Job politics in USA is most important.
I think it's awesome that the two top leaders in China are named Hu and Wen. It's an Abbott & Costello skit waiting to happen.
not that I would want them.
Do you think that the US Government could order the shut down of thousands of factories without public outcry, let alone court battles and the like. China can do this because it isn't like the people who work at those locations have a voice. Sure some of the higher ups at each will get reassigned, but rest are probably low skilled and have lower education.
In China they spend people like we spend dollars.
* Winners compare their achievements to their goals, losers compare theirs to that of others.
Right? I mean, this is exactly what a lot of people have been wanting China to do for a while. So this is fantastic. Where's the celebration?
Why does good news in the east cause complaints about the west? The west pollutes a lot less then China, but somehow an announcement about shutting down antiquated steel mills makes China greener then us? I understand their rate-of-change might be better, but that's not sustainable. They are not going to forgo dams tomorrow as being too environmentally destructive. "If current trends continue" is a straight faced lie.
Yeah awesome "management" of the sea and the (earlier) life within.
Not that you may have much choice with so many people on such a small area.
I am in China now and the rate of change here is amazing. The amount of development in roading and new building is nothing short of impressive but what I really noticed the high rate of EV usage. In the 'developed' world we talk about how great EVs would be if they were both practical and cheap but in China they just get on with it because here EVs are both very practical and cheap. For USD $250 to $350 you can buy the functional equivalent to a 50cc scooter which is cheaper to run and can take you anywhere in the city and back home on a charge. What more do you need? It seems to me the difference is the Chinese will use something if it's good enough for what they do most of the time where as we have to have a vehicle that does everything we might want to do, even if we seldom have the need. I guess the truth is there is many factors at play but the bottom line is in the cities I have seen here the EV scooters significantly outnumber cars but back home (New Zealand) I have never seen an actual EV in use on a public road. I should add I don't count half assed hybrid like a Prius as an EV unless it can be used without petrol.
Are they big on nuke plans there? or the old COAL.
China: 12 reactors operating, 24 under construction. Plans are to quadruple those figures by 2020.
China has to do this. China's energy consumption has doubled in the last decade, and just passed that of the US. New capacity is being added very rapidly, but may not be able to keep up with demand. So they need to pull the plug on some of the energy hogs.
China has traditionally had a shortage economy. China no longer has famines, but they enforce a one-child policy to keep the population from growing further. The Chinese government estimates that it had three to four hundred million fewer people in 2008 with the one-child policy, than it would have had otherwise.
How do we know this has anything at all to do with any high minded ideals at all?
How do know this isn't more about politically loyal and financially compliant entities being allowed to continue operating and disloyal entities or those on some enemies list are being shut down?
As a scenerio, assume that while China's GDP numbers look good there's some slow contraction going on as the economies in the West continue to suck and manufactured goods purchases slow. This leads to rocky business environment and getting rid of the competition makes sense. To keep loyalists loyal, the party thins the heard. The survivors tithe to the party, make money and show their loyalty.
Convenient and high-minded rationales are sold to the people and the west.
I think it's safe to assume China is not pulling the plug on these enterprises because of environmental concerns. In a command economy,the only way to modernize industrial enterprises is by government fiat. The fact that improving efficiency has environmental benefits just makes for good pr.
The Chinese capitalist experiment only covers part of the country. as a result, much of China is filled with value destroying enterprises that would have gone bankrupt in a purely capitalist society. (It costs $1 of inputs to produce $1 of output.) On the upside, they employ people - but given that populations are declining due to the government mandated reverse baby boom, that is no longer as much of a concern.
That's not even remotely true. In fact, money has been FLOODING into US Treasury securities. Borrowing costs for the US have declined for year term investments to like a quarter of a percent, and even for long-term (30 year) bonds, the government still only has to offer 4% interest. This meants that the bond markets are not taking seriously the idea that the US government is borrowing too much money and inflation is going to come roaring back.
The U.S. also tackled this problem. We did it by shutting down ALL of the steel mills and outsourcing to the low bidder in China. Hey! How's that economy doing?
Their one child policy means there's 400 million less Chinese than there otherwise would be. That means huge cuts in emissions in China already
....you're about to emulate the American Rust Belt in record time!
American manufacturers, note the voice of opportunity clamouring in your ear.
~REZ~ #43301. Who'd fake being me anyway?
Funny how the "evil communist country" gets important things done while the "modern" west endlessly bickers about it. I wouldn't yet want to live in China, with all the oppression that's also a part of the package, but I'd exchange our lobbyist-servile, stupid, fucked-up idiot politicians for some chinese dictator-wannabe with the balls to tell the big industry to go fuck themselves and do as the government says.
The only thing they're missing is that it should be a government by the people, for the people. Then again, we don't have that in the west anymore, either.
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Amazing ballsy shift from the produce-at-all-cost mentality that typified China during it's early industrial growth. My hat's off to whoever had the vision to make this happen.
"If you're not passionate about your operating system, you're married to the wrong one."
The USA held everything up by adding a pile of different rules and then refused to sign onto the ones it proposed. Where do you think the silly carbon stock exchange idea came from? It's as if somebody read a book on how the League of Nations was poisoned into uselessness and applied that to the climate forum.
To get iron from iron ore the important thing is to get the oxygen out - all that coking coal is really to do that and not to heat it up. You can't just use another source of heat to save much carbon since you need carbon monoxide for the reaction.
Most cement is made from calcium carbonate. It doesn't matter what heat source you use there, you are still going to release a lot of carbon dioxide.
You've picked probably the two most difficult areas where it's hard to reduce carbon emissions at all. There are plenty of other areas to look at first.
I sincerely hope you guys don't believe they are shutting down 2000 factories because of energy.
They are shutting down the factories because they don't have any orders for them to build things. This is just another example of the Chinese government hiding their data, and making them look better than what they are.
Comapnies will never do anything to reduce energy until energy becomes too expensive.
Unfortunately we can't wait for that.
Companies keep populting in a myriad of ways and governments are doing less than is required to fix things.
As long as governments in the West don't tax heavily polluting companies (poluttion is highly correlated to energy consupmtion btw) or establish fair taxes targeted at high poluters companies and individuals will not change their ways.
No wonder that only in a dictatorship they can take concrete steps to tackle environmental isseus (nad here I know China is way behind the West, but I think the penny is droping and will start *doing* (not talking) something about it).
Where is that dreamy land, where the rivers are made of milk and honey?
Kyoto was a sham because the most polluting country could not be arsed to "harm its local economy".
The amount of treaties and intenraional agreements the US does not join or sign is so long that one really wonders why other countries keep playing ball with whatever derided thing the US comes up with when they really are not forced to.
Alas, you don't actually get carbon credits for not having children.
And no, there haven't been "huge cuts in emissions in China already". What there have been are "huge increases in emissions in China already". And this announcement will result in (assuming they even abide by it) MORE huge increases in emissions in China....
"I do not agree with what you say, but I will defend to the death your right to say it"
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