Moving Towards Carbon Emission Peaking and Carbon Neutrality

By Audrey Guo

At the 75th General Assem- bly of the United Nations in September 2020， China announced its goal to peak carbon dioxide emissions and achieve carbon neutrality， which means China， as the largest developing country around the world， will have the largest reduction in carbon emissions intensity， and realize carbon neutrality as a first in the world. China will have both a lower GDP per capita and carbon emissions per capita than those of developed countries such as the U.S.， countries in the EU and Japan when its carbon emissions peak.

Implementation based on toplevel design On October 24， 2021， the Cen- tral Committee of the Communist Party of China （CCCPC） and the State Council issued Working Guidance for Carbon Dioxide Peaking and Carbon Neutrality in Full and Faithful Implementation of the New Development Philosophy and Action Plan for Carbon Dioxide Peaking Before 2030， giving a guide for China to achieve these goals.

The working guidance is the overall planning and top-level design， and the “1” in the “1+N” policy ， mainly targeting at： by 2030， carbon dioxide emissions per unit of GDP will have dropped by more than 65% from 2005， the share of non-fossil energy consumption will have reached about 25%， the total installed capacity of wind power and solar power will have topped 1.2 billion kilowatts， the forest coverage will have come to about 25%， and the forest accumulation will have reached 19 billion cubic meters. Besides， CO2 emissions will have peaked？and stabilized and then declined. By 2060， China will have fully established a green， low-carbon？and circular economy and a clean， low-carbon， safe and efficient energy system. Energy efficiency will be at the advanced international level， and the share of non-fossil energy consumption will be over 80%. In one word， China will then be？carbon？neutral.

Measures for the Administration of Carbon Emissions Trading （Trial）， which came into effect on February 1， 2021， are the rules for the national carbon emission trading market，which involved more than 2，200 key emitters from the power generation industry as the first batch of players， and intends to involve power generation enterprises and self-generation power plants with annual greenhouse gas emissions of 26，000 tonnes of carbon dioxide equivalent. On July 16， the national carbon market started online trading. According to the Ministry of Ecology and Environment， the first batch of power generators represented more than 4 billion tonnes of carbon dioxide emissions， making the national carbon market in China the largest emissions trading system. According to the data from Shanghai Environmental Energy Exchange （SEEE）， as of December 28， 2021， the cumulative trading volume of carbon emission allowances （CEA） in national carbon market exceeded 159 million tonnes， with a turnover of over RMB 6.6 billion.

On October 10， 2021， the Outline of National Standardization Development was released， which proposed to establish and perfect standards for the carbon emissions peak and carbon neutrality， namely to accelerate the improvement of carbon emission verification and accounting standards for regions， industries， enterprises， products， and more， to develop greenhouse gas emission standards for key industries and products and improve the labeling system for low-carbon products， improve renewable energy standards and develop standards for ecological carbon sinking， capturing， utilization and storage， and implement projects to upgrade the standardization of carbon dioxide emission peaking and carbon neutrality. In addition， the Ministry of Industry and Information Technology （MIIT） announced a drafting plan for 110 standards to boost industries to realize double-carbon goals.

In October of the same year， the Supreme People’s Court issued Opinions on Providing Judicial Services for Environmental Trials and the Protection of Environmental Resources， proposing to accurately indentify the economic， public and ecological attributes of carbon-related rights such as carbon emission rights， carbon sinks and car- bon derivatives， and properly handle relevant civil disputes involving the confirmation of rights， transactions， guarantees and enforcement in accordance with laws and rules， while support and supervising administrative organs investigate and deal with illegal acts in accordance with laws and rules， such as false reporting and the concealment of greenhouse gas emissions， refusal to fulfill the obligations of greenhouse gas emission reporting and so on by carbon dioxide emitters.

In addition， the Central Bank has launched tools to support carbon emission reduction， meaning to provide direct loans to enterprises in three key areas： clean energy， energy conservation and emission reduction， and carbon emission reduction technology. Meanwhile， financial institutions should calculate the carbon emission reduction driven by loans， disclose information publicly， and accept verification by third-party institutions and public supervision. Together with the National Development and Reform Commission and National Energy Administration， the Central Bank also jointly issued a notice on special re-loans to support the clean and efficient utilization of coal， especially seven key technologies including safe， efficient， green and intelligent mining， clean and efficient processing， clean and efficient use of coal power， clean industrial combustion and supply of heat， clean civil heating， comprehensive utilization of coal resources and the development and utilization of coal gas.

Local actions towards doublecarbon goals

Provinces， autonomous regions and municipalities in China are now actively developing action plans for local goals with regards to the carbon emission peaks and carbon neutrality as set in the 14th Five-Year Plan， and many are preparing the action plans to peak carbon emissions by 2030. Besides， key industries and enterprises take the initiative to formulate technologies and measures for green transformation， decarbonization and carbon reduction.

Beijing： Develop a special ac- tion plan for carbon dioxide emission control in both intensity and volume， define a clear timetable and roadmap for carbon neutrality， and improve the carbon emission trading system. Advance energy restructuring and energy conservation in key areas such as transportation and construction， and increase the share of green energy. No less than 80% of new or updated vehicles in public sectors for transport， rental， logistics and distribution should be new energy vehicles， while accelerating the phase-out of older vehicles.

？Shanghai： Adhere to the priority of ecology and the concept of green development， put more effort in environmental management， and accelerate the implementation of ecological projects， to secure green and high-quality development. Deeply promote the comprehensive treatment of industrial volatile organic compounds， and fully carry out national 6a emission standards for heavy-duty diesel vehicles.

Chongqing： Promote green low-carbon development， carry forward the action plan for the carbon dioxide emission peak， build a number of zero-carbon demonstration parks， and cultivate a carbon emission trading market. For the energy network， speed up the implementation of the natural gas transmission net-work project in western Chongqing， expand the volume of Shaanxi coal into Chongqing， improve the capacity of transport channel for coal from Northern China into Chongqing， strive for new quotas of electricity from the Three Gorges Hydroelectric Power Station into Chongqing， promote the integrated development of Sichuan and Chongqing power grids， push forward the process of electricity from Xinjiang into Chongqing， and prepare projects including Liuziwan pumped storage power station.

Guizhou： Improve the ecological compensation mechanism， promote the market-oriented trading of emission rights， carbon emission rights， and so on. Standardize the development of new energy vehicles and intelligent networked vehicle industry. Play the role of leading enterprises in attracting industrial clusters， support Panjiang Coal and Electricity， Wujiang Energy， Zhenhua Electronics and other state-owned enterprises to become stronger， better and bigger， play the leading role of Huawei， Geely， CNGR Advanced Material， Lao Gan Ma and other enterprises， to develop a number of specialized and novel“small giant” enterprises and individual champion enterprises.

Accelerate the construction of the green energy system

At present， there is still a large share of more than 50% for coal in China’s energy consumption， a carbon dioxide emission intensity per unit of energy 1.3 times the global average， and an energy consumption per unit of GDP 1.4 times the global average and 2.1 times that of developed countries. Now， China continues to import some key low-carbon， zero-carbon and carbon-negative equipment and processes and technologies， and has a weaker capacity when it comes to comprehensive technical integration， industrialization as well as transfer and promotion， meaning there is a long and hard way for China to establish low-carbon and zero-carbon energy systems.

According to Wang Jinnan， President of the Chinese Academy of Environmental Planning of Ministry of Ecology and Environment， China should set carbon emission peaking goals for 31 provinces， autonomous regions and municipalities， key industries and sectors targeting at carbon neutrality， accelerate the development of a gradient management system to control the total volume of local carbon dioxide emissions， and confirm national， industrial and regional peaking results respectively， through a bottom-up national carbon dioxide emission statistics and accounting system.

Huang Han， Vice President of the Economic and Technological Research Institute of Global Energy Interconnection Development and Cooperation Organization （GEIDCO）， said， based on Energy Internet， China is fully implementing two substitutions， namely that of coal with electricity and clean energy， to effectively reduce coal consumption to 2.7 billion and 2.5 billion tons of standard coal in 2028 and 2030 respectively， slow down the growth of oil and natural gas consumption， which should be peaked in 2030 and 2035 at 740 million tons and 500 billion cubic meters and increase the share of clean energy in primary energy consumption to 27% in 2028 and 31% in 2030.

As Huang Han pointed out， compared with carbon emission reduction in industry， transportation， construction and other terminal energy consumption areas， replacing coal power with clean energy power generation is technically a mature， economic and easy alternative， and the most efficient and economical carbon emission reduction measure at the moment. If the installed generation capacity of wind， solar and other new energy grows by 130 million kilowatts per year， China will peak carbon emission at a lower peak value and buy time for carbon neutrality.

Zhou Yuanbing， President of the Economic and Technical Research Institute of GEIDCO， said， the power gap due to closed coal-burning power plants can be completely supplemented by clean energy， while it can ensure safe and stable operation of a power system centering on clean energy through flexibly reconstructed coal power generation units， joint wind and solar electricity storage and transmission system， demand-side response， large grid interconnection and other measures.

For the future， there is a new development goal for energy and power industry in China. To achieve double-carbon goals， it’s urgent to accelerate the construction of a green， low-carbon and sustainable modern energy system， through speeding up the green and low-carbon transformation， ensuring safe and reliable electric supply， strengthening technological innovation， and encouraging open energy cooperation.

Now the energy cooperation along the Belt and Road focuses on hydropower， wind power， photovoltaic and other clean energies. According to data from American Enterprise Institute for Public Policy Research， from 2014 to 2020， the proportion of investment in renewable energy along the Belt and Road has increased significantly by nearly 40%， surpassing that of fossil energy. Xie Zhenhua， China’s special envoy on climate change， said： “We will further formulate and perfect corresponding fiscal， tax， financial， industrial and project management policies， to effectively control coal consumption and coal power generating capacity， while continue to work with all parties to build a green Belt and Road and guide overseas investment into low-carbon and environment-friendly projects.”