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China energy demand may already have peaked: researchers

[June 30, 2017] By David Stanway and Alister Doyle

SHANGHAI/OSLO (Reuters) - China's energy demand has reached peak levels and is set to fall in coming years, an influential government think tank said, in a study offering an optimistic view on Chinese efforts to combat climate change.

The study by the China Academy of Social Sciences (CASS) study said China's total energy consumption is expected to fall to the equivalent of 4 billion tonnes of standard coal in 2020, which would represent a decline of 8 percent from last year.

Consumption would then inch down to 3.74 billion tonnes in 2030 and 3 billion tonnes by 2050, the study said.

"(Peak demand) could be this year or next year - this is a gradual process and isn't just coming down suddenly from a very pronounced summit," said Qiang Liu, director of CASS's Institute of Quantitative and Technical Economics.

The CASS study suggests Beijing is cutting coal use far faster than expected, and comes weeks after U.S. President Donald Trump decided to quit the 195-nation Paris agreement on climate change and reaffirmed his commitment to revive U.S. fossil fuels.

It also indicates China could reach its pledge to bring climate-warming greenhouse gas emissions to a peak by "around 2030" earlier than expected, given that the energy sector is estimated to account for 70-80 percent of its CO2 emissions.

The CASS forecast contrasts with China's 2016-2020 energy plan that said total energy use would grow around 2.5 percent a year until 2020 and a forecast by state-owned China National Petroleum Corp for energy consumption to peak by 2035.

The study comes ahead of the July 7-8 Group of 20 summit in Hamburg, Germany.

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Smoke rises from chimneys and cooling towers of a refinery in Ningbo, Zhejiang province August 19, 2014. REUTERS/China Daily/File Photo

British researchers suggested last year that China's CO2 emissions were likely to peak far earlier than the official target and could have hit their maximum in 2014. The analysis was rejected by China's top climate official, Xie Zhenhua.

Nicholas Stern, chair of the Grantham Research Institute on Climate Change and the Environment, the research paper's co-author, told Reuters by email that the CASS study was consistent with their findings.

But despite China's "over-performance by a big margin", nations still needed to pledge more if the Paris target of holding temperature increases to "well below" 2 degrees Celsius is to be met.

"We look to all countries to achieve a substantial ramp-up in ambition for cutting emissions," he said.

However, Chinese experts said Beijing was unlikely to adjust its CO2 reduction targets.

"China set the target for 2030, but also said we aim to reach the target in advance, so we have already left some room," said Ma Aimin, deputy director at the National Centre for Climate Change Strategy.

(Reporting by David Stanway in SHANGHAI and Alister Doyle in OSLO; Additional reporting by Muyu Xu in BEIJING; Editing by Richard Pullin)

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