During this year’s annual sessions of the National People’s Congress and the Chinese Political Consultative Conference national committee (“Two Sessions”), green development and related topics such as climate change and clean energy once again came under the spotlight. This is not only due to the serious challenges climate change poses to the whole of mankind, but it is also an inevitable need of China’s economic development upon reaching a certain stage. A notable achievement of this year’s “Two Sessions” is the further establishment of the principles and roadmaps for greater emphasis to be placed on the ecological sustainability and green development, under the circumstances of which one may expect new growth opportunities in the renewable energy sector and other related industries.

At the United Nations Climate Change Conference (UNFCCC COP26) held in Glasgow in November 2021, China pledged to raise the share of renewable energy in its total energy consumption to 25% by 2030, up from the originally scheduled 20%. China’s Ministry of Industry and Information Technology then issued the “The 14th Five-Year Plan for Industrial Green Development” a month later, which proposes a concrete roadmap to achieving carbon emission peak in the industrial sectors, and accelerating both the switch to low-carbon energy consumption as well as the transformation to “cleaner” production processes. By 2025, carbon intensity must be reduced by another 18%, while the emission intensity of major pollutants in key industries needs to be reduced by 10%. The consumption of new energy vehicles, photovoltaic solar thermal products and green consumer electronic products will also be further expanded.

It is commonly acknowledged that climate change caused by increase carbon dioxide and other greenhouse gas emissions is a serious challenge facing human society today. Since the 1990s, countries around the world have set their own emission reduction targets to mitigate the catastrophic effects of global warming. As a major carbon emitter, China’s emission reduction plan has been closely watched by the international community. At the 2020 UnitedNationsGeneralAssembly (UNGA), Chinese President Xi Jinping announced that China aimed to peak its carbon dioxide emissions by 2030 and achieve carbon neutrality – essentially zero net emissions – by 2060. The proposal of China’s carbon neutrality goal is of great significance as the world seeks to attain the climate goals laid out by the Paris Agreement, signaling China’s willingness to take on a greater role as a responsible player in global governance. It goes without saying that whether such ambitious emission reduction targets will hinder China’s economic development is also a topic of concern. China’s carbon neutrality target is comparable to the reduction targets proposed by industrialized developed countries, indicating China’s willingness to take on costly international responsibilities for the sake of global governance, and to hold itself to higher and more stringent standards.

Carbon neutrality means zero net emissions, which is an extremely challenging goal not only for China, but also for every country worldwide. While the United Nations has repeatedly highlighted the importance of achieving carbon neutrality by 2050s to effectively limit global warming to 1.5 degree Celsius above the pre-industrial levels, no country has managed to achieve the target as of yet; even the most technologically advanced nations are still very much reliant on fossil energy (coal, oil, natural gas, etc.) to fuel their economic growth. Some are even questioning the practical feasibility of carbon neutrality per se, raising concerns it may just be a theoretical target that is neither realistic nor plausible.

Technology advancements and structural optimizations of the economy are vital to mankind’s quest to achieving carbon neutrality. The application of new low-carbon energy technologies will increase people’s reliance on renewable energy, including wind, solar, geothermal, hydropower and biomass energy, etc. Progress is also being made in the efficiency of fossil energy. Global economic structure is increasingly gravitating towards adopting “digital” and “intelligent” forms of production and supply chains. The proportion of modern service industry is on the rise, while that of traditional industries and agricultural sectors are on the decline. The economic structure is gradually becoming “lighter”, which is conducive to carbon emission reduction. Conventionally, the transportation sector has been excessively dependent on fossil energy sources, such as petroleum. However, thanks to the development of electric vehicles and hydrogen vehicles, renewable energy sources are playing a greater role when it comes to transportation. China has now become the world’s largest producer and consumer of electric vehicles, as the sales figures of electric vehicles continue to grow. Moreover, China’s export of electric vehicles to its foreign trade partners is also on a rapid rise. According to the roadmap to carbon neutrality laid out by the International Energy Agency (IEA), electric vehicles should account for 60% of global vehicle sales by 2030; we can therefore conclude that the electric vehicle industry in China is still in its infancy, and has a long way to go before reaching its full potential.

The use of clean energy is crucial to achieving green development in China. The proportion of coal, a highly pollutive energy source, has declined to 57% from the previous 70% in the country’s overall energy structure. Meanwhile, low-carbon forms of energy such as wind, solar, hydropower, and even nuclear energy have seen rapid development in recent years. China has become the world’s largest developer of wind, solar and hydropower, with wind and solar power installations on the rise thanks to the declining costs and increasing government support for the relevant industries. Capacities of these new energy sources are expected to double again by 2060, replacing fossil fuels as the main source of China’s energy supply. Judging by the current trends, the goal of setting up renewable energy to account for 25% of its total energy consumption by 2030 seems to be well within China’s grasp.

From this year’s “Two Sessions”, we observe that the key principles of green development, including “dual carbon” (carbon emission peak and carbon emission neutrality) among other goals, have become the popular, widely accepted consensus both within the Chinese government and among its people. Against the backdrop of continuous innovation in new energy technologies, China’s “dual carbon” goal will further optimize its energy and economic structure to promote sustainable economic and ecological development of the country.

Dr Chen Gang
Senior Research Fellow
East Asia Institute, NUS