Coal is answer to one quarter of the world’s energy demand. In China, coal is the most important fuel. 63% of total energy supply is coal in China, which is more than the global average. At the same time coal brings serious environmental and social damages. In current years, Chinese economy has drastically improved and coal has played a vital role in this. This massive usage of coal has increased the carbon dioxide emissions. Chinese government has started to encourage national coal mining companies to invest out of China to secure supplying of coal (Sinton & Fridley, 2000). All governments in the world want to promote a transparent and competitive market to secure energy for all. The growth in Chinese market that recently has been three times more than the entire world’s coal trade, has a deep affect on global coal flows. This demand that is an important component of international trade can lead the to higher coal price in market. It can also impact the coal trade balance (Shi, 2009). It seems that since Chinese coal resources is massive, China will not run out of coal. However, China still face some challenges in its coal market. Some of these challenges are: * The average depth of mining is increasing
* The rate of resource recover is low
* A lot of mines are in sensitive environments with a limited water resources * Mining fatalities are decreasing
* Coal transport routes are long
There are different recommendations that can be said about these challenges to Chinese government. For example, Chinese government can promote FDI and JV in energy sector. This can be done in technology transfer sector both out and into China (Jiang, 2008). Also both national and international partnerships that are supported by government can stimulate new technology development before commercialize it.
Replacing Shale gas instead of Coal
As it was mentioned earlier one of the greatest challenges in using coal in China is Carbon...