Changhua Wu: China’s low carbon growth plan goes far beyond Paris

Reading time: 6 minutes
18 March 2015

Changhua Wu, Greater China Director, The Climate Group, looks back at the National People’s Congress to consider what the leaders’ latest economic growth plans and climate commitments mean for the biggest emitting country’s place in the global clean revolution. 

China’s National People’s Congress is over for another year. And while there were no further surprises, in his annual Work Report, Premier Li Keqiang mentioned China will “actively respond” to climate change and expand the country’s carbon market pilot schemes.

If read carefully and in depth though, the Premier’s report outlines a rather comprehensive sustainable development plan for the country in 2015. It covers all major aspects of China’s economic, social and ecological development.

With just nine months to go until the COP21 global climate talks in Paris, these outcomes will form an important part of China’s INDC – countries’ early climate pledges, of which China is expected to submit in the last week of May.

Like many, I’m hopeful China’s INDC will show continued efforts to address the country’s energy structure, shifting away from heavy fossil fuel dependence toward cleaner energy.

CLEAN ENERGY LEADERS

As things stand, China will continue to lead global clean energy investment, having broken records last year. Premier Li’s Work Report emphasizes cleaner energy production and consumption, continuingfull efforts” to develop wind, solar energy and biomass energy. But it will also actively explore hydropower, safely develop nuclear power and utilize shale gas and coal-bed methane.

Energy saving also remains an important part of China’s economic strategy. On top of capping total energy consumption, plans to boost energy efficiency in industry, transportation and building sectors, as well as wasted resource reuse, will forge ahead.

The government also promises tougher punishments for polluters. One key reason China is the world’s largest market for clean technologies is its more restrictive laws and regulations to enforce environmental policies. These laws helps create demand for clean tech, which naturally attracts capital flows. China is a good showcase of how this could work in other countries too.

But despite its promising low carbon economy, China today is overwhelmed by smog, water pollution and soil contamination, exacerbated in the last three decades of rapid economic growth. China’s ecosystems can’t possibly afford to carry on like this anymore.

So, President Xi, together with his generation of leaders, has decided to instil ‘Ecological Progress’ into the core value of his governance for the 13th Five Year Plan, which runs from next year.

ECOLOGICAL PROGRESS

This framing concept is about the relationship between man and nature, a kind of value system about getting along with Chinese ecosystems’ carrying capacity, when delivering goods and services to support human development is concerned.

In this way, Ecological Progress will fundamentally impact China’s low carbon economy, as it is the foundation for driving such a change.

As you’ll read in our latest Insight Briefing, there are three critical elements to the concept: 1) ecological redlines or boundaries; 2) pricing natural capitals; and 3) ecological compensation.

Of course there are challenges for decision makers around how to set these boundaries, since this is the beginning stages of any policy to be set in place and be effective. But once they’re clearly set, we’ll see a rare resource scarcity. China could then potentially quickly find a price for natural capital based on market supply and demand.

But of course, all of this is easier said than done. And furthermore, how this will impact a global climate deal at COP21 remains to be seen. However, I am confident China will champion such a value system at the regional and global level. Ecological Progress goes far beyond Paris.

LOW CARBON CHINA 

Besides supporting a robust global climate deal, there is much that business, government and the public can do to help drive low carbon growth in China now.

Government sets policy incentives, businesses have expertise and resources, and the public holds the purse to drive the market trends. These three powerful forces must work hand-in-hand to accelerate the transition.

In China, The Climate Group supports this collaboration by working closely with government and business leaders to pilot innovation and best practices, advise on national climate finance policy design and sustainable development strategy, as well as support local governments in energy planning and capacity building. A great example is our RE100 campaign which supports businesses committed to going 100% renewable; the first Chinese company, Elion Resources, joined this week.

One project we’re particularly excited about at the moment is the Future Academy, a platform to train future low carbon business leaders and entrepreneurs. Using an MBA-modelled program that focuses on case studies, we bring CEOs, young professionals and entrepreneurs together with top experts to create the leaders of the new energy economy. Recruitment is now open for our second year, which will kick off 2015 by the end of the month in Beijing.

I hope you will join us to support this and other projects that are set on propelling China’s clean revolution ahead, to Paris, the 13th Five Year Plan period, and far further into a cleaner, better future for China – and the global economy.

Read our new Insight Briefing report 'Ecological Progress': Understanding China's new framework for sustainable development

To explore the outcomes from National People’s Congress and discuss how China will deliver its promises through Ecological Progress, we hosted a live Twitter Q&A with our China Director Changhua Wu on March 16. Read a summary here. 

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