China’s Path Towards Carbon Neutrality

By Xie Zhenhua

The world is undergoing unprecedented changes unseen in a century. The next decade will be critical for shaping the global political and economic landscape through climate actions. China pledged to achieve carbon emissions peak by 2030 and carbon neutrality by 2060. This means that China is to make the most drastic cut in carbon emission intensity and will transition from carbon peak to carbon neutrality in the shortest timeframe in world history. Under the guidance of Xi Jinping Thought on Ecological Civilization, China must have a good grasp of the megatrend, push for great transformation, and set sights on the larger picture, so as to open up a path towards carbon neutrality that bolsters its efforts to build a strong, modern socialist country, demonstrates its commitment and responsibility, consolidates its advantages in development, and fosters a sound environment.

First, taking responsibilities based on a good grasp of the megatrend.

Climate change is an indisputable fact of science and an urgent and severe existential crisis. Green and low-carbon transition has emerged as a global megatrend and a new ground for economic, technological and institutional competition in the years ahead. General Secretary Xi Jinping emphasized on many occasions that to tackle climate change is not what others want us to do, but what we have to do, as it is an essential part of China’s efforts to achieve sustainable development and build a community with a shared future for mankind.

—Displaying the climate determination through a science-based approach

The five large-scale scientific assessments by the Intergovernmental Panel on Climate Change (IPCC) show that the current global temperature is about 1.0℃(0.8-1.2℃) higher than the pre-industrial level, which is mainly caused by human activities. Without more mitigation and adaptation actions, it may go further up 3℃or 4℃or even higher at the end of this century. International organizations such as the Global Commission on Adaptation report over US$ 300 billion economic losses caused by climate disasters worldwide in 2020, and predict that more than 120 million people may fall into absolute poverty because of climate change.

China is vulnerable to the impacts of climate change. From 1991 to 2020, meteorological disasters caused over RMB 240 billion direct economic losses and nearly 3,000 deaths. If the temperature increased by 3℃and 4℃, the sea level would rise by 1 meter. In this scenario, the coastal areas that are home to more than 40% of the population and over 50% of the GDP will suffer heavy economic and social losses.

The CPC Central Committee and the State Council take climate change very seriously. By taking into consideration both domestic and international situations, China is pursuing a proactive national strategy to tackle climate change. On many important international occasions, General Secretary Xi Jinping stressed that the Paris Agreement points the way forward for the green and low-carbon transformation of the world. His statements speak to China’s climate ambition and determination, which give a strong political boost to the global climate governance process and have been applauded by the international community.

To fulfill its nationally determined contributions (NDCs), China slashed emission intensity per unit of GDP by 48.4% in 2020 compared with 2005, equivalent to reducing CO2 emissions by about 5.79 billion tons, SO2 by about 12 million tons, and nitrogen oxides by about 11.5 million tons. The forest stock increased by about 5.1 billion cubic meters, GDP grew 4 times in the same period, all the rural poor were lifted out of poverty, and the average life expectancy increased by 5.5 years. In so doing, China not only over-fulfilled its pledged climate targets, but also synchronized its climate action with economic development and environmental improvement.

—Enhancing impetus for development based on national conditions

Carbon peak and neutrality is a momentous, thoughtful  decision made by the CPC Central Committee, and will take enormous efforts to achieve.First, China emits huge quantities of CO2, accounting for 28% of the global total and exceeding those of the US, Europe and Japan combined. China’s per capita emissions are 6.5 tons, higher than the global average.Second, under the low-carbon and zero-carbon constraints, many countries actively promote carbon labeling and low-carbon product certification, and plan to levy carbon tariffs. China’s manufacturing industry accounts for about 30% of the world’s total. A large number of goods are produced in China and consumed in other countries, which not only involve the cross-regional transfer of carbon emissions, but also face green barriers in international trade.Third, China’s economy is tilted towards heavy industries, its energy mix is dominated by coal, and its science and technology and basic capabilities are weak, which makes it a daunting challenge to bring about a comprehensive green and low-carbon transformation. That said, China boasts a relatively complete industrial system and comparative advantages. In particular, it is a world leader in renewable energy, with about 33% of the world’s total installed capacity, and over 5 million new energy vehicles ownership, accounting for about 50% of the global total. China’s 5G technology is among the tops in the world, which is conducive to intelligent applications and electrification.

Therefore, to achieve the carbon peak and carbon neutrality is an enormously challenging task that calls for strenuous efforts. On the other hand, it creates great opportunities for the comprehensive green and low-carbon economic and social transformation in China. Taking active climate actions can drive more than RMB 130 trillion investments, which is equivalent to 2%-3% of GDP every year, nothing short of a huge market potential. It can reduce the“carbon density” of products, improve the quality of economic growth, and secure a competitive edge in international trade. It can also address environmental pollution at the source, and is expected to bring air quality up to the Class A standard (which means the average annual concentration of PM2.5 is 15μg/m3), thus greatly improving the health of the people. This will also add to the inherent impetus for China’s sustainable development.

Second, promoting major transformation and nurturing competitive advantages.

Fifty-six countries have announced their goal of achieving carbon neutrality by the middle of this century, which accounts for nearly 70% of global emissions. Countries will accelerate the industrial and technological revolution that is green and low- carbon. This will inevitably lead to competition among major economies. China’s carbon peak and neutrality drive represents both a broad-based and profound economic and social transformation, and an important opportunity to improve its international competitiveness.

—Adopting a systemic approach by making a top-level design

Climate action involves various aspects of economy and society, and is a big systematic project. It is necessary to adopt a systemic approach, and work out a proper balance between development and emission reduction, overall interests and local interests, as well as short term and medium-to-long term. Pollution and carbon reduction must also be well connected with the security of energy, food, industrial chain and supply chain. Carbon peak and neutrality must fit in the ecological civilization strategy, and medium and long-term economic and social plans. In the process of green economic and social transformation, carbon reduction will be the strategic priority. As green and low- carbon energy development is the key, pollution and carbon reduction should be synchronized. Efforts must be accelerated to foster an industrial structure, way of production and life, and spatial layout geared towards energy conservation and environmental protection.

To make a top-level design is to formulate targeted and workable policy measures for priority sectors and major issues, and to develop guidelines on carbon peak and neutrality under the leadership of the Central Leading Group on Carbon Peak and Neutrality. Competent authorities must fulfill their due responsibilities and form synergy. At the same time, local authorities must also live up to their duties, set clear goals and tasks, and make action plans in keeping with the realities, so as to achieve carbon peak and neutrality on schedule.

—Applying strategic thinking and maintaining strategic focus

As the largest developing country, China’s per capita GDP has just exceeded US$ 10,000, only 1/6 of that of the United States and 1/3 of that of the European Union. China will peak carbon emissions in less than 10 years, by which time China’s per capita GDP will be far lower than that of developed countries. The EU needs 60 years to move from carbon peak to neutrality and the US 45 years. By comparison, China is striving to complete it within a little more than 30 years.

The next ten years will be crucial for China to achieve carbon peak and neutrality. China must apply strategic thinking, maintain strategic focus, pursue high-quality, green and low-carbon development that puts ecology first, curb the unplanned development of highly polluting and energy-intensive projects, and make full use of the huge emission reduction potential brought by new economy, new technologies, and new business models, as well as reform and innovation in electricity, industry, transport and construction sectors, transform and upgrade old and new growth drivers, accelerate the building of a clean, low-carbon, safe and efficient energy system, actively develop non-fossil energy, and strictly control coal-fired power projects. Coal consumption will be strictly controlled in the 14th Five-Year Plan Period and steadily reduced in the 15th Five-Year Plan Period. All these will drive high-quality development and green and low-carbon transition in economic and social sectors. China will stay firm in delivering the goal of carbon peak and neutrality, follow the law of economics, and demonstrate its commitment as a big, responsible country through real actions that are taken at its own pace.

—Making breakthroughs in key sectors with an innovative mind

Any country that wants to achieve carbon neutrality must rely on innovation. Those who can think and act innovatively will be among the first to make breakthroughs in key technologies and foster institutional advantages, and will secure a dominant position in rules making on green and low-carbon development, and seize the opportunities in the international market.

According to“Net Zero by 2050: A Roadmap for the Global Energy Sector” issued by the International Energy Agency (IEA) in 2021, more than 50% of the key technologies for net zero emissions are not yet mature. Therefore, the key to achieving carbon peak and neutrality in China lies in independent scientific and technological innovation. It is necessary to formulate the development strategy of low-carbon and zero-carbon technologies, make breakthroughs in cutting-edge low-carbon technologies including high-efficiency solar cells, hydrogen production from renewable energy, controlled nuclear fusion and zero-carbon industrial process transformation, accelerate the research and development and promotion of technologies in smart grid, advanced energy storage, large-scale carbon capture and utilization and storage, and establish and improve the platform for green and low-carbon technology evaluation, trading, and scientific and technological innovation.

Institutional reform and innovation provide important safeguards for realizing carbon peak and neutrality. To this end, the reform of the energy system should be deepened to affirm the role of local grids, micro grids and distributed energy as main market players, and fully liberalize the tariff in competitive sectors. Fiscal and pricing policies should be improved. In addition to increasing input of public fund and encouraging the participation of social capital, China may explore the establishment of a National Fund for Green and Low Carbon Transition, develop innovative green finance products and services, accelerate the building of China Carbon Emission Trade Exchange, improve laws, regulations and the standard measurement system, raise the standards for energy consumption of key products, and establish a unified and standardized carbon accounting system.

Third, setting sights on the larger picture and creating a favorable environment.

Climate change is a crisis that threatens the survival and development of mankind and the well-being of future generations. No country can stay unaffected. Multilateralism and win-win cooperation is the only choice for all countries. China is one of the first to set the goal of carbon peak and neutrality. Other countries have updated their NDCs and carbon neutrality vision. China will continue to promote the multilateral process of global climate governance and create a favorable environment for the green and low-carbon development of all countries.

—Rules-based, fair and reasonable

China will take an active part in international negotiations on climate change, work for positive progress in the Glasgow climate conference to be held this year, and contribute Chinese wisdom and solutions to the comprehensive and accurate implementation of the Paris Agreement on the basis of openness, transparency, wide participation, driving by parties and consensus.First,under the principle of fairness, capability and common but differentiated responsibilities, countries should update their NDCs in keeping with their national conditions and formulate medium and long-term development strategies to achieve carbon neutrality by the middle of this century.Second, balanced progress must be made in mitigation, adaptation, capital and technology. Capacity building of developing countries must be matched with the support of developed countries, which should fulfill their annual financial commitment of US$100 billion.Third,outstanding issues in the negotiations on the establishment of a global carbon market as stipulated in the implementation guidelines of the Paris Agreement should be resolved as early as possible. A global carbon market should be operational at an early date to protect environmental integrity, prevent carbon leakage, and uphold trade fairness.

—Promoting win-win cooperation through concerted efforts

Europe, the UK, the US, Japan, the Republic of Korea, Brazil and many other countries or regions have committed to achieving their carbon neutrality and net zero emission goals by 2050. Germany went a step further with the goal of realizing climate neutrality by 2045, setting a good example for all countries, especially developed ones. Although countries vary in national conditions, stage of development, and goals, they have much in common in thinking, paths and policies, and face the same challenges in de-carbonizing power and industrial sectors, electrification, intelligent applications, as well as low-carbon and zero-carbon building and transport. In this globalized world, countries can give full play to their comparative advantages and strengthen international exchanges, policy dialogues and practical cooperation. In the spirit of win-win cooperation, China, on the path toward carbon neutrality, should deepen exchanges and cooperation with other countries in green technology, green equipment, green services, green infrastructure, and green finance, lead the global climate governance process, and work with all countries to build a community of life for man and nature.



Xie Zhenhua is Special Envoy for Climate Change Affairs of China.