MAC: Mines and Communities

China Update

Published by MAC on 2006-09-01

China Update

1st September 2006

A new parliamentary report reveals that sulphur dioxide (SO2)- mainly from coal-fired power plants - is now blighting a third of China's territory, while the amount of dumped chromium wastes could be as high as five million tonnes.

In response, the regime is proposing to institute an "emissions trading scheme" giving plants the "right" to emit SO2.

Meanwhile the income gap between the country's rural poor and its urban better-off is growing...

China Eyes Sulphur Dioxide Emissions Trading - Paper

PlanetArk CHINA

1st September 2006

BEIJING - China is planning to launch an emissions trading scheme as early as next year that would require power plants to pay 7 billion yuan a year for the right to emit sulphur dioxide, the South China Morning Post reported.

Under the proposal, part of a drive to cut sulphur dioxide emissions by 10 percent by 2010, power stations would pay 630 yuan a tonne for the quotas, the Hong Kong paper quoted an environmental adviser to the central government as saying.

China is the world's biggest emitter of sulphur dioxide. Coal- and oil-fired power stations were responsible for 11 million of the 25 million tonnes discharged last year, which caused acid rain that affected a third of the country.

Wang Jinnan, vice-president of the Chinese Academy for Environmental Planning, told a seminar in Hong Kong on Wednesday that the proposal was subject to consultation with China's provinces and the power sector, the paper said.

Under the scheme, power generators would have to buy emission rights to cover their expected sulphur dioxide discharges. They would be able to sell any spare quota to other polluters that failed to meet the government's targets.

Wang, an adviser to the State Environmental Protection Administration, said he hoped the scheme would go into effect next year. He estimated it would raise electricity prices by 0.08 yuan a kilowatt-hour.

"The policy will be applicable to existing suppliers, with some allowances reserved for new market entrants," he said. Among the obstacles to the scheme is the absence of national legislation on emissions trading, the paper quoted another environmental expert as saying.

A parliamentary report earlier this week said more than half China's cities and counties had suffered acid rain, some of them on a daily basis, posing a major threat to soil and food safety. Hong Kong and the neighbouring manufacturing province of Guangdong plan to launch a voluntary cross-border emissions trading scheme on a pilot basis later this year aimed at clearing the territory's smoggy skies.


China Fails to Cut Main Pollutants - Government

PlanetArk CHINA

31st August 2006

BEIJING - China failed to rein in two main pollution indicators in the first half of the year as soaring energy use and lax environmental controls thwarted policies to clean foul water and skies, the government said on Wednesday.

"Environmental protection and economic development are not proceeding in unison," the China Environment News, the official paper of the State Environmental Protection Administration (SEPA), wrote in an editorial.

China has set a goal of cutting pollution output by 10 percent, adjusted for economic growth, over the next five years. But just last week, Chinese authorities said acid rain caused by sulphur dioxide affected a third of China's land mass last year, posing a threat to food safety.

In the latest assessment, SEPA announced on its Web site ( that nationwide emissions of sulphur dioxide from coal-fired power stations grew to 12.7 million tonnes in the first six months -- up 4.2 percent on the same period last year.

The official environmental monitor also said its key measure of water pollution -- "chemical oxygen demand" or COD -- rose 3.7 percent. COD gauges the noxiousness of wastewater.

In the editorial, SEPA laid the blame for the rising pollution on poor enforcement and a "crude mode of economic growth". Many new power stations have equipment to strip sulphur from smoke, "but the level of use is not high", said the official announcement.

Even when cities build wastewater treatment plants, some fail to expand pipe networks to collect wastewater from factories and buildings, it added.

The official numbers came in the wake of repeated warnings by officials that China is failing to tame pollution even after promising a shift to clean development.

A senior parliamentary official, Sheng Huaren, said discharge of sulphur dioxide rose by 27 percent between 2000 and 2005 to 25 million tonnes, making the country the world's top emitter of the pollutant.

China's sulphur dioxide emissions were double the acceptable limit, he said.


Acid Rain Affects Large Swathes of China - Report

PlanetArk CHINA

28th August 2006

BEIJING - Acid rain caused by sulphur dioxide spewed from factories and power plants affected a third of China's vast land mass last year, posing a threat to food safety, Xinhua news agency said citing a parliamentary report.

More than half of the 696 cities and counties monitored had suffered acid rain, in some cases on a daily basis, according to a pollution inspection report submitted to the standing committee of parliament, the official agency said.

"Increased sulphur dioxide emissions meant that one third of China's territory was affected by acid rain, posing a major threat to soil and food safety," Xinhua cited NPC standing committee vice chairman Sheng Huaren as saying.

Discharge of sulphur dioxide in booming China rose by 27 percent between 2000 and 2005 to 25 million tonnes, making the country the world's top emitter of the pollutant.

Sheng told lawmakers that China's sulphur dioxide emissions, caused largely by coal-burning power stations and coking plants, were double the acceptable environmental limit.

According to the report's findings, nearly 650 out of 680 coking plants in Shanxi, the country's main coal-mining province, discharged excessive sulphur dioxide, Xinhua said.

Air pollution, caused mainly by sulphur dioxide and particulate matter, was affecting some 40 percent of Chinese cities, Sheng said.

China has pledged to install desulphurisation facilities in coal-burning power plants and is planning pilot emissions trading schemes to help improve air quality.

The capital, Beijing, has promised to replace its notorious smog with clear skies in time for the 2008 Olympics.

In the same parliamentary report, Sheng also lifted the lid on false reporting of solid waste discharge levels by local governments and companies.

Actual levels of toxic chromium waste in China could be as high as five million tons instead of the 4.1 million reflected in official figures, Xinhua cited the report as saying.

"Many firms report a lower figure for chromium waste for fear of being punished," Sheng said.

One locality had originally reported that it had 3,000 tons of chromium waste but raised the figure to 100,000 tons after learning the government would build reprocessing facilities for them instead of fining them, he said.


China's Income Gap Widening; ADB Says Addressing Rural Poverty is the Solution

By Zijun Li, Worldwatch Institute (

22nd August 2006

A recent study by China’s National Development Reform Commission reports that the country’s Gini Index, a measure of household income distribution, has reached 0.4 (up from 0.37 in 2003), indicating that the rich-poor gap nationwide continues to grow. Widening income disparities between urban and rural areas are unlikely to be reversed in the next decade, according to [1] Fan Gang, director of the National Economic Research Institute at China’s Reform Foundation [2].

Xinhua News Agency [3] reports that Chinese farmers’ incomes in the first half of 2006 increased at a slower pace than the corresponding period last year: average annual earnings increased 11.9 percent, to 1, 797 RMB (US $225), but the overall growth rate was down 0.6 percent from the same term last year. Among urban residents, average disposable incomes grew 10.2 percent to 5,997 RMB ($750), a rate 0.7 percent higher than in 2005.

The slower growth in farmers’ incomes is attributed to ongoing declines in the prices of primary products such as grain and livestock, and simultaneous increases in the costs of agricultural production inputs; this trend has reduced average net income by 30–50 RMB ($4–$6), according to Xinhua News Agency [4].

Overall, the average net income of China’s farmers has increased at a rate of 6.2 percent, far below the 9.6 percent growth witnessed in urban areas.

Experts note that the income gap within China’s urban areas is even greater than that between urban and rural regions, and is the major culprit behind overall disparities between rich and poor, according to Shanghai Security Newspaper. The Chinese Academy of Social Sciences’ 2005 Social Blue Book [5] reports that the disposable income of some 60 percent of urban residents is lower than the national average, according to People’s Daily [6].

While disparities in income distribution are considered inevitable during China’s economic transition, the speed at which the gap is widening has raised concerns. Haruhiko Kuroda, President of the Asian Development Bank, warns [7] that China should step up efforts to reduce imbalances between urban and rural development and focus greater attention on helping the most economically depressed areas shrug off poverty.


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