China Energy Outlook 2020 - Flipbook - Page 32
Industrial Sector
Despite a recent slowdown in China’s GDP growth and industrial activity, demand for energy
intensive raw materials and products continues to increase due to urbanization and
infrastructure construction (sometimes bolstered by national and local economic stimulus
measures), the associated increase in domestic commodity consumption, and manufacturing
exports. Though China’s industrial energy efficiency has improved over the past decade, the
energy intensities of China’s major industrial subsectors generally lagged behind international
levels less than a decade ago (Li, 2010; International Energy Charter,2018), although new
facilities often have internationally state-of-the art equipment.
China’s industrial sector11 is not only the largest economic sector by far in terms of primary
energy consumption but its share of total energy use has remained relatively constant,
fluctuating between 67% and 73% since 1980 and settling at 70% from 2013 to 2018.12 In 2018,
China’s industrial sector primary energy consumption of 2983 Mtce (87.42 EJ) was larger than
the total national energy consumption of every country worldwide (including all European
countries combined), except for the U.S. (BP, 2019b).
China’s industrial sector transforms raw materials into products that build the country’s cities
and infrastructure. In addition, China is a key global manufacturing center. China tracks the
production and energy consumption associated with 30 industrial sectors. Among those
products, a few are not only very energy-intensive but also produced on a massive scale
including iron ore, crude steel, cement, aluminum, and glass. Other energy-intensive industrial
products manufactured in China include chemicals such as ethylene and ammonia,
petrochemicals, machinery, textiles, food, paper and paper products, transport equipment, and
wood and wood products.
China is the largest cement producer in the world, growing from 30% of global production in
1995 to 56% in 2019 (USGS, various years). Cement is mainly consumed domestically in China,
with 2017 exports of 12 Mt, or only 1% of total production (China Customs, 2019). After years
of continued growth to support domestic infrastructure expansion and economic growth,
China’s cement production reached a peak in 2014, producing about 2,500 Mt of cement. After
2014, cement production in China declined at 3% per year on average from 2014 to 2018,
reaching 2,200 Mt in 2018 (Figure 1-14). However, the latest data show that China’s cement
production increased 4.4% in 2019 compared to 2018 after four years of decline.
11
Industrial sector refers to the secondary sector of China’s economy, which includes mining, manufacturing, and
water production and distribution. Within manufacturing, there are the following main sub-sectors: wood and
wood products; transport equipment; non-specified industry; paper, pulp, and printing; food and tobacco; textiles
and leather; petrochemicals; machinery; non-metallic minerals; chemicals and chemical products; and metals. In
this report, industrial sector energy use is also combined with energy use of agriculture and construction sectors,
unless noted otherwise.
12
Note also that the share of secondary sector (mining, manufacturing, construction, power, heat, natural gas, and
water production and supply) value added in China’s total GDP has also remained relatively constant at about 40%
between 1990 and 2018 (see Chapter 2).
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