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Coal energy push strains an already water-stressed China

by Erin Berger | @erineberger | Thomson Reuters Foundation
Monday, 16 September 2013 10:00 GMT

A truck drives past as a worker sprays water at a coal pier of Lianyungang port, in China's Jiangsu province, on February 26, 2012. REUTERS/China Daily

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Many of the water-hungry coal power plants and gasification plants planned in China are in areas already short of water, studies show

LONDON (Thomson Reuters Foundation) – The rapid expansion of coal energy projects in China, experts say, threatens another already-scarce resource in the country: water.

A World Resources Institute (WRI) report has found that over half of China’s 363 planned coal-fired power plants - which use large quantities of water to produce steam to drive turbines, and for cooling - are to be built in areas with high or extremely high water stress.

Another investigation by Greenpeace earlier this year revealed that China’s largest coal chemical company – which converts coal to liquid fuels - is using scarce water and polluting much of what remains in rural Inner Mongolia. The company has admitted to many of these negative impacts, researchers say, but has yet to share any plans to change, and in fact says it plans to expand production.

The problems reflect growing tension in fast-growing China between demands for water and power, experts say.

“China has two different conflicting goals it’s trying to meet: increasing energy capacity and managing its water resources more efficiently,” said WRI’s Betsy Otto. “The country’s energy plans and water plans need to be coordinated more closely.”


Last month, researchers at WRI used a mapping tool called Aqueduct to analyze tensions between coal use and water supplies in China. Aqueduct measures water risks and opportunities around the world using a range of indicators such as drought severity and flood occurrences.

They overlaid their water risk map of China with the locations of proposed coal plants. Shades of red on the map indicate areas of high water stress, and black dots represent planned coal-fired power plants.

On the finished map, many of the black dots cluster in red areas. In fact, the map revealed that 60 percent of the proposed plants occur in just six provinces, but those provinces contain only 5 percent of China’s water resources.

The researchers were not surprised that stress is growing on China’s already constrained water supplies, said Otto, who directs the Aqueduct project. “But it was quite striking that more than half of the total proposed new power generation plans were in areas of high or extremely high water stress,” she said.

Places of high or extremely high water stress withdraw more than 40 percent or 80 percent, respectively, of the available renewable water supply each year. When a water-intensive plant comes into the picture, conflict with other competing water users – farmers, industries and homeowners – can break out, Otto said.

Even for power plants themselves, lack of water is a risk, Otto pointed out.  Plants, for instance, could be forced to reduce output or even shut down entirely during a drought.

So why are such a great number of coal-fired power plants planned in water-scarce areas?

One reason, Otto said, is simply to bring power where it’s needed, particularly to places where industry is quickly developing.

Many plants are simply built where the coal is mined. “It’s more efficient to do that,” Otto said. But coal mining itself is a water-intensive process, and many coal mines happen to be in arid places, which sets the stage for worsening water scarcity when power plants are built as well.

It’s not yet clear how many of the planned coal plants will go through. Chinese officials this week released new plans to tackle the country’s worsening air pollution, aimed at slashing coal consumption by cutting its use in some industries and increasing consumption of nuclear power and cleaner natural gas for the country’s energy needs.

Nearly three-quarters of China’s electricity today is produced from coal.

But according to WRI, if all of the country’s planned coal-fired power plants were built, they would push the industry’s water withdrawal to as much as 10 billion cubic meters annually by 2015. Put into perspective, that’s more than a quarter of the flow that could be withdrawn from the Yellow River annually.

Alongside plans to build more coal-fired power plants are plans to expand China’s coal chemical sector, which transforms coal into other energy products. There is a growing demand for coal liquefaction – producing liquid fuels like petroleum from coal and water.

“The coal chemical industry is growing at a rapid pace in China - unseen in other countries,” Greenpeace East Asia campaigner Deng Ping said. She said the process is resource-intensive and creates staggering amounts of waste for each amount of end product.

Shenua Group, China’s largest coal conglomerate, for instance, reported that creating just one ton of oil through direct coal liquefaction requires 10 tons of water. The process produces nine tons of carbon dioxide – a major greenhouse gas that drives climate change - and 4.8 tons of wastewater.

Earlier this year, Greenpeace looked at the Fortune 500 company to evaluate its impact on water resources in rural China. They specifically looked at Shenhua’s coal-to-liquid project in rural Inner Mongolia – a project that could triple its water use if the company gets government approval.

Shenhua began setting up its project near the Inner Mongolian city of Ordos in 2002, but local water reserves had already been largely exhausted there, according to Greenpeace. In 2006, Shenhua began extracting groundwater in the nearby Haolebaoji region. In the following six years, Shenhua drilled 22 wells that extract up to 14.4 million tons of water a year, Greenpeace said.


The impacts have been dramatic for Haolebaoji’s farmers and herders, many who have lived in the area for generations. The amount of vegetation in the region, and local sheep herds, have sharply declined. Every single hand-dug well in Haolebaoji has run dry, according to Greenpeace, and locals must now dig much deeper wells to access water. By 2011, the main lake in the region had decreased in size by 62 percent.

“There’s no bigger project in existence that could do more damage to our lives,” Wuzhu Yunle, a farmer living in the Ordos grasslands, told Greenpeace. “Do the lives of the people mean nothing?”

Lack of water isn’t the only problem. Shenhua stresses that its plant uses special technology that can re-use almost all of its wastewater. But Greenpeace representatives visited the plant and discovered, not far from the plant itself, highly toxic industrial wastewater seeping into the ground. Lab tests found that the groundwater below contained harmful substances in amounts up to 3.3 times China’s national guideline level.

There are multiple wastewater discharge sites at the Shenhua plant, putting local river basins and groundwater supplies at risk of becoming long-term “storage containers” for toxic materials, Greenpeace said.

Shenhua’s actions directly violate several national laws and policies, including regulations that aim to protect the area around Haolebaoji from water-intensive industries, and regulations governing groundwater resources.

Greenpeace also points out that in order to obtain water extraction licenses, Shenhua would have been required to assess the local impact of the project and consult the community in case of conflicts of interest. Haolebaoji residents say they were never consulted, the report says, though they opposed the project from the beginning.

“From the first day Shenhua started to drill for water there, residents were against it,” Deng said. Over the last 10 years, residents have been vocal about their disapproval and many have written petitions in protest, she said.

Unless the central government implements stricter regulations, Deng said, Shenhua is likely to continue growing. And, she said, another large coal-to-gas project proposed by a different company was commissioned in August in Xinjiang Province, just to the west of Inner Mongolia.

“The same resource question Shenhua is grappling with applies to the other coal chemical projects in China,” Deng said, pointing out that most of the projects are located in the arid northwest of China, close to coal resources but with limited water resources and fragile ecological systems.

After Greenpeace released their report, Shenhua contacted the organization and provided an explanation of the problems from their perspective. They admitted to the illegal waste discharge problem and the negative impact on local vegetation. But they did not answer any questions about how impacts might be reduced, or about the company’s plans for expansion, Deng said.

In Haolebaoji, residents continue to worry about what will happen when the water runs out. “The government has asked us to move, but I’m not willing to leave my grasslands,” said Wuzhu. “I can’t bear to leave them.”


Today, China accounts for almost half of the world’s coal use, and coal powers about 70 percent of the country, according to WRI. But as Greenpeace, WRI and other research organizations are finding, China’s current level of coal use does not appear sustainable, and clashes directly with the country’s struggle to ensure adequate water resources.

In some cases, technology could cut down on the pollution and resource-intensity associated with coal projects. Otto said that one water-saving option for coal-fired power plants, for example, is cooling technology that uses air instead of water.

Deng said that the Chinese government must take a hard look at the local impact of proposed projects before giving approval. She pointed to several agencies that will be key in the push for more careful coal planning: the Chinese Water Resource Department, Energy Bureau, National Development and Reform Commission and Environmental Department.

Ultimately, Otto said, the most important efforts will be those that help the country shift away from coal. “Investing more in energy efficiency programs is the cheapest, smartest, best solution,” she said.

Erin Berger is a Thomson Reuters Foundation intern, writing on climate change issues.

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