Washington (Platts)--15Jul2009

US Energy Secretary Steven Chu told students and faculty at one of
China's most prestigious science and technology universities Wednesday that
the nation should lead the developing world in limiting climate change.

"What the US [does], and what China does in the coming decades will
actually, in large part, determine the fate of the world," Chu said at
Beijing's Tsinghua University. "So it is very important that we in the US move
very aggressively towards decreasing the amount of carbon in the world, and I
sincerely hope that China follows soon after."

Chu's parents graduated from the university before moving to the US.

Students packed the aisles in the stuffy auditorium as Chu warned about
the dire consequences from rising global temperatures that many blame on
greenhouse-gas emissions. Rising sea levels could imperil coastal Chinese
cities, and shrinking glaciers in the Himalayas could lead to water shortages
in China and India, he said.

China recently surpassed the US as the number one emitter of greenhouse
gases such as carbon dioxide. Together the two countries produce 42% of the
world's CO2, Chu said.

China has been under pressure since it refused at a Group of Eight
meeting last week to support the adoption of greenhouse gas emission targets,
saying such limitations would be unfair to developing nations. That meeting in
Italy came as the world prepares for climate talks in Copenhagen, Denmark, in
December, which are aimed at producing a successor to the Kyoto Protocol, an
international climate treaty that expires in 2012 and which limits greenhouse
gas emissions.

"We all live in the same world," Chu said. "The developed world did make
a problem, I admit that, but the developing world is going to make the problem
much, much worse. And we are all in this together, so we have to fix it
together."

While Chu called on China to lead developing nations in finding ways to
reduce GHG emissions, he also praised China for renewable energy and energy
efficiency policies implemented in 2005. China already has vehicle
fuel-efficiency standards that exceed the US, but Chu said both countries
could learn from Europe and Japan, where standards are around 50 miles/gallon,
almost double the US.

Chu also said that energy research in the two countries could set an
example for others. Such research cooperation was formalized Wednesday, at the
end of back-to-back meetings with several of China's highest energy and
research officials.

After the meetings with State Counselor Liu Yandong, Minister of Science
and Technology Wan Gang and National Energy Administration chief Zhang Guo
Bao, the officials announced a new bilateral energy research center to
coordinate energy research between the two countries.

The US-China Clean Energy Research Center would receive $15 million
dollars from each country to focus on building and industrial efficiency,
carbon capture and storage, renewable technologies, nuclear energy and clean
vehicles. It would have headquarters in the US and China to help researchers
perform joint projects.

The US and China are two of the largest users of coal for power
generation, and the center will also focus on ways to develop technology to
reduce the CO2 emissions from coal-fired power plants. In addition, on
Wednesday Chu was scheduled to visit an integrated gasification combined cycle
coal pilot-plant, which is designed use coal with near-zero emissions.

--Derek Sands, derek_sands@platts.com