Report Can fracking green China’s growth? Opportunities, risks and recommendations for unconventional gas in China’s environmental transformation Ilmi Granoff, Sam Pickard, Julian Doczi, Roger Calow, Zhenbo Hou and Vanessa D’Alançon April 2015 Overseas Development Institute 203 Blackfriars Road London SE1 8NJ Tel. +44 (0) 20 7922 0300 Fax. +44 (0) 20 7922 0399 E-mail:
[email protected] www.odi.org www.odi.org/facebook www.odi.org/twitter Readers are encouraged to reproduce material from ODI Reports for their own publications, as long as they are not being sold commercially. As copyright holder, ODI requests due acknowledgement and a copy of the publication. For online use, we ask readers to link to the original resource on the ODI website. The views presented in this paper are those of the author(s) and do not necessarily represent the views of ODI. © Overseas Development Institute 2015. This work is licensed under a Creative Commons Attribution-NonCommercial Licence (CC BY-NC 3.0). Cover photo: Shell: Checking gas detectors at Changbei, China. Contents Acronyms 8 Acknowledgements 9 Executive Summary 10 Ensuring shale gas reduces air and GHG pollution 10 Understanding and managing shale’s water impacts 11 Handling impacts and trade-offs for land use and local populations 11 Creating and enforcing a robust policy framework 11 1. Introduction: China’s push towards an ecological civilisation 13 1.1 China confronting the need for greener growth 13 1.2 Unconventional gas in the energy transition 14 1.2.1 Natural gas is a growing part of China’s energy sector 14 1.2.2 China is estimated to have the largest global shale resources 14 1.2.3 Chinese unconventional gas production is likely to remain substantial through the medium term 15 1.2.4 The implications of shale gas are clouded by polarised debate in the US 15 1.3 Understanding the risks of shale gas in China is important for China and the world 16 1.4 Structure of the analysis 16 2.