June 4, 2013
Damien Ma
Summary:
Beijing can start to solve its environmental and economic troubles by ending one of the most stubborn legacies of the planned economy: highly regulated energy prices. If recent reports are any indication, that is exactly what it plans to do.
A taxi driver fills his car near a board showing price increases at a gas station in Shenyang, Liaoning province, 2011. (Courtesy Reuters)
Much like the United States, China has an “all of the above” energy strategy: it plans to continue to rely on traditional sources of energy even as it makes the transition to cleaner fuels. And this is only natural. Both countries are continent-sized economies with diverse energy needs and geographically dispersed resources.
Suppressed prices drive China’s uncontrolled energy consumption and its negative side effects.
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