China sidelining coal through more natural gas consumption

China is making strides with its efforts to use more natural gas in place of coal, a report Monday from the U.S. Energy Information Administration said.

"Natural gas accounted for only 4.9 percent of China's total energy consumption in 2012, but large investments in domestic natural gas production and infrastructure, along with growing imports, are likely to underpin a significantly larger role in the future," a brief from EIA said.

The Chinese government said it's committed to a low-carbon economy. The share of natural gas in the energy mix should increase by 10 percent by 2020.

China is the world leader in emissions. Beijing says it's readjusted its economic structure in a way that promotes green energy and a low-carbon economy in an effort to combat climate change.

EIA said China more than tripled its gas production since 2003. Nevertheless, since 2007, Chinese gas consumption has outpaced production, forcing the company to rely more on gas imports.

The brief said China could replace imports by tapping into what could be the largest deposits of shale natural gas in the world.

"Investors [in shale] face geological, technical and water resource challenges, regulatory hurdles, transportation constraints, and competition with other fuels," EIA said.