China's green economy and its unknowns for the Russians

Russia exported 24% more oil to China in 2023 than in the previous year. And the Sila Sibiri pipeline is also operating at full capacity. But Beijing's rush into renewable energy production and the electric car market says that its goals are divergent from Moscow's. And that the current boom - vital for Russian finances - cannot last long.

Moscow (AsiaNews) - Russia has reversed the export of extractive fuels from the West to the East, but the main buyer, China, is moving fast in the direction of cleaner energy sources, with a big prospect of green change in the coming decades. And this certainly does not help the Kremlin's plans. Beijing is currently the main lifeline for the Russian economy, buying up ever larger quantities of oil, coal and gas, albeit at reduced prices. But China is simultaneously becoming one of the world leaders in green energy and electric means of transport, subjecting Europe itself to its dominance in the sector.

Precisely at this time when Xi Jinping and Putin are attending the summit of the Shanghai Cooperation Organisation, the international security forum created jointly by Beijing and Moscow in 2001 and which now includes the countries of Central Asia, India, Pakistan and Iran, in Astana, on Važnye Istorii, 'Important Stories', a Russian renewable energy expert, Tatiana Lanšina, spoke, noting how China, until now the world leader in greenhouse gas residues with a quarter of the world's polluting debris, has now put clean energy at the top of its economic priorities. Carbon Brief estimates that by 2023, this sector's contribution to China's economy has reached a record 11.4 trillion yuan (.6 trillion), guaranteeing a large investment growth of up to 40 per cent of GDP. That is more than in any other sector of the economy.

These estimates include various types of energy, renewables and nuclear power, power grids and accumulators, electric cars and railways. The largest investments in 2023 are in solar panels, electric cars and accumulators. Globally, China has 43% of the potential of solar power and wind turbines, and together the capacity of these renewables exceeds one terawatt; by comparison, Russia's is 0.5% of China's, and in general the power of the entire Russian energy system does not reach a quarter of China's solar and wind power.

By exploiting its low labour costs and huge domestic market, as well as the speed at which these projects can be realised, China is increasingly positioning itself as a leader in the implementation of the Paris climate agreements. At the same time, however, Beijing is also increasingly exploiting 'dirty' coal sources. According to official figures, in 2023 it built 95 per cent of the world's new facilities in this field, using 53 per cent of fossil fuels, a share that is set to increase in the coming years. Chinese companies are therefore trying to make the most of the possibilities of this sector, until the green conversion is radical by 2030.

In this panorama, gas is used by the Chinese for only 3% of energy production, more for industrial complexes. China remains the world's largest producer of coal, and switching to gas is not cost-effective, as is the use of oil, which even on a global level is not used for energy, but mainly for transport. And even at this level the Chinese economy is 'greening up', switching to electric vehicles with impressive speed: already in 2023 more than 25% of new cars were electric, compared to 6% in 2020.

Russia exported 107 million tonnes of crude oil to China in 2023, 24% more than the previous year, and also increased its gas exports by 1.5 times, with 8 million tonnes of natural gas liquids. For these materials it has become China's largest customer, surpassing even Saudi Arabia and Turkmenistan. Deliveries, however, are increasing according to the transport capacities of the Sila Sibiri gas pipeline, 'Force of Siberia', which is already at full capacity, and there is no way to convince the Chinese to support and finance the construction of Sila Sibiri-2 (Putin had to take a further setback on his recent trip to Beijing). The enormous growth in trade in recent years is therefore destined to come to a standstill, and Chinese objectives in the sector take into account their own interests much more than those of the Russians, with an effect in perspective far greater than any Western sanctions.