But the fug over Beijing could slowly be improving, since new, strict air pollution regulations have come into place and the city has a coal cap.
To replace local coal power, the the city has invested in four coal-to-gas plants - according to Reuters it has taken a "cautious approach" because of concerns about CO2 emissions and scarce water resources.
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In a deal driven by The Beijing Enterprises Group, it has agreed with the Municipal Government of Huhhot in Inner Mongolia that the Western province will provide Beijing with four billion cubic metres of synthetic natural gas (SNG) each year.
The SNG comes from Datang’s Inner Mongolia Keqi plant - one of two operational pilot projects in China (the other one is Qinghua’s Xinjiang plant).
Research by Tsinghua University (Report on China’s Low-carbon Development, 2014 [in Chinese]) finds this contract will reduce Beijing’s coal consumption by 8.94 million tons, but increase Inner Mongolia’s by 12.03 million tons - a net increase of coal consumption of around 3.09 million tons per year.
This results in a net increase of CO2 emissions of around 3.77 million tons per year.
The researchers state about 85% of the emissions generated in the life cycle of coal-to-gas are as a result of the conversion process, and 15% when the gas is burned - meaning the lion’s share will be emitted in Inner Mongolia, in this case.
Furthermore, Inner Mongolia, is arid, and coal-to-gas projects are thirsty. According to the same research from Tsinghua University, the project will increase Inner Mongolia’s consumption of water by about 24 million tons - a huge amount considering Inner Mongolia’s water deficit reached around 1 billion cubic metres in 2011.
The Keqi coal-to-gas plant has also been beset by technical issues since Phase one (of three) became operational in December last year. The plant shut down in January for several months because of corrosion problems.
Earlier this month, the plant’s operator, Datang International Power Generation, announced it was restructuring its coal chemical business and related business, Chinese news agency Xinhua reported - potentially alarming investors and those inside the coal-to-gas industry.