EME 444
Global Energy Enterprise

Energy Policy, Supply and Demand


Three Gorges Dam

China's Three Gorges Dam satellite photos. 2000 photo has no water. 2006 photo has a lot of water
Three Gorges Dam, China

Because it is the world's largest hydroelectric installation and the subject of significant controversy, China's Three Gorges Dam warrants specific mention in this lesson. Construction started in 1994. The 600-foot high dam across the Yangtze River was completed in 2006. The reservoir reached full height in 2010, after submerging 13 cities, 140 towns, and 1,350 villages, all in all displacing 1.3 million people. (BBC News, May 2011, China acknowledges Three Gorges dam 'problems')

In 2011, China took the unusual step of admitting there were problems with the project. The New York Times reports, "China’s State Council, a coordinating body often likened to the United States president’s cabinet, said in a vague statement that the project suffered from a wide range of serious problems. 'Although the Three Gorges project provides huge comprehensive benefits, urgent problems must be resolved regarding the smooth relocation of residents, ecological protection, and geological disaster prevention,' the statement said." For full story, see New York Times, China Admits Problems with Three Gorges Dam, May 2011.

In February of 2014, the US Energy Information Administration reported, "The world's largest hydropower project, the Three Gorges Dam along the Yangtze River, was completed in July 2012 and includes 32 generators with a total maximum capacity of 22.5 GW. The dam's annual average power generation is anticipated to be 84.7 TWh. The Chinese government plans to increase hydro capacity to 325 GW by the end of 2015. However, China has faced some delays on projects resulting from environmental concerns and complications of population displacement" (EIA China Analysis).

However, it appears that the Chinese government is becoming more hesitant to ignore environmental sustainability issues at the expense of hydroelectric infrastructure. In April of 2015 news has slowly leaked out that the government has canceled plans to add hydroelectric dams to the upper reaches of the Yangtze River, as evidenced by the scrapping of the plan to build a large dam in the city of Chongqing. (New York Times, China Blocks Yangtze Dam Project, Activists Say). It is difficult to say for sure, but according to reports from environmentalists in China, the project in Chongqing was canceled due to environmental concerns, including habitat destruction of endangered fish species. This may be an indicator that the government has grown concerned about the environmental impact of their energy infrastructure.

Energy Policy, Supply and Demand

One intention of this course has been to expose you to information resources that may serve you well in future courses and your professional work. Earlier in this lesson, we introduced the United States Central Intelligence Agency publication, The World Fact Book. In this section, we use the international resources from the U.S. Energy Information Administration.

To Read Now

Read the Country Analysis for China from the U.S. Energy Information Administration. (Make sure you are reading the version dated August 2022.)

Read (or scan closely) the following sections (more if you have time, it's very interesting).

  • Overview

  • Petroleum - Trade.

  • Natural Gas - Entire Section

  • Coal - Entire Section

  • Electricity - Entire Section

International Agreements

China was a key player in the COP21 (the "21st Conference of Parties") negotiations in December 2015 which resulted in the Paris Climate Agreement (sometimes called the "Paris Accord"). Both China and the U.S. signed (on Earth Day 2016) and ratified the Paris Climate Agreement. Combined, they emit nearly 40% of the world's carbon emissions. In a role reversal, it is now the Chinese government that is urging the United States to uphold its commitment, as President Donald Trump has withdrawn the U.S. from the agreement (though notably, cities, states, and businesses in the U.S. have stepped up and filled the emissions reductions gap admirably). This is another chapter in the history of China's varying role in global climate agreements.

China is well known as the major global supplier of solar panels. This article from the IEA demonstrates the extent of China's dominance in the global solar supply chain. Not only is China the major solar panel supplier globally, but the solar industry contributes quite a bit to China's overall global trade balance. The U.S. government has recently imposed tariffs on Chinese solar panels and components, in order to support domestic manufacturers. The solar trade war is not going away - the recent Bipartisan Infrastructure Law passed by the U.S. Congress designates "domestic content requirements" for solar panels to be eligible for subsidies and incentives.

Optional Reading

Please read "Changing Climate: What The Paris Accord Means For China" from Law360 to get some context for their role in this, and previous agreements.

Before reading the article, here are some terms that might be helpful to know:

  • Conference of Parties (COP): From the United Nations: "The COP is the supreme decision-making body of the (UNFCCC). All States that are Parties to the Convention are represented at the COP, at which they review the implementation of the Convention and any other legal instruments that the COP adopts and makes decisions necessary to promote the effective implementation of the (UNFCCC)..." The COP has a meeting each year. The Paris Climate Agreement was made at the 21st COP, aka COP21.

  • UNFCCC: United Nations Framework Convention on Climate Change. This is the UN treaty that was signed in 1992 establishing the Conference of Parties (COP) system, thus establishing the organizational foundation for international climate agreements.

  • Non Annex I Party: This is how the Kyoto Protocol referred to "developing" countries that were not bound to emissions targets in the Protocol. Annex I parties, on the other hand, were required to reduce emissions. (There are other differences between the two, but this is the primary one.) China is a non Annex I country.

  • Clean Development Mechanism (CDM): CDMs are international development mechanisms created by the UN to allow Annex I countries to offset their carbon emissions by funding clean energy projects (e.g., wind farms, reforestation, etc.) in non Annex I countries. These have the dual benefit (in theory, anyway) of providing financial and technological assistance for establishing a more sustainable and lower emission energy infrastructure in low-income countries.

In addition, for a perspective on the dynamic interplay between China, the EU, and the U.S. with regards to the solar industry, tariffs, and subsidies (Oh my!) read "China's solar subsidy cuts erode the impact of Trum tariffs" from Nichola Groom of Reuters and "Commission scraps tariffs on Chinese solar panels" by Jorge Valero of Euractiv.