China is the world’s largest greenhouse gas emitter, so reduction policies are tremendously important signals to the world, says Dr. Anthony Horton.
In the lead-up to the Paris meeting this December where the international framework through which post 2020 carbon emissions reductions will be facilitated, all countries are required to submit their post-2020 targets. China provided a preliminary indication of its initial target during a joint announcement with the US in September last year (reductions of 40-45% per unit of GDP by 2020) and is expected to finalise its post 2020 emissions reduction targets before the end of this month. The Government’s commitments may include emissions intensity targets post 2020, more granularity around renewable energy targets and afforestation goals.
China is the world’s largest greenhouse gas emitter (10.5 billion tonnes per year) and reduction targets are tremendously important signals to the world. China is also seeking to improve air quality in its major cities, increase energy security and industrial development and build resilience against volatile fossil fuel markets. Current estimates indicate that the chronic air quality may be costing 10-13% of GDP in terms of health and other impacts, and this is one of the drivers for the major structural shift away from pollution intensive development that is occurring in China. Air pollution has also been linked to more than 1.2 million premature deaths in China.
It is now increasingly likely that China will meet its current 2020 targets and indications are that total emissions will peak prior to 2030, which will require additional sustained actions over the next decade. China is the world’s importer of fossil fuels, which makes the economy particularly vulnerable to volatility in global energy markets, and therefore increasing the capacity of renewable energy sources will reduce the vulnerability. China is also the largest investor in renewable energy (US$89.5 billion in 2014), and more than 3.4 million people in China are employed in the renewable energy sector. There are signals that coal consumption will peak sooner than anticipated, if it hasn’t already peaked. In 2014 China committed to 20% of its total energy being sourced from non-fossil fuel sources by 2030. It is a sobering thought that to meet this target, China will have to build a renewable energy and nuclear powered supply system with the capacity of the entire US electricity system in 15 years.
It is projected that rainfall decline in Northern China will lead to insufficient water availability for agriculture by the early 2020s. Losses from drought in 2030 is projected to cost US$1.1-1.7 billion in Northwest China, while risks of vector borne diseases (eg. Malaria) in the central lakes region (amongst others) will increase as a result of more severe rainfall events. Shanghai, Guangzhou and Tianjin are in the top 5 most asset exposed flood risk cities in Asia as a result of climate change. In addition, more frequent and intense heat waves are expected and the health impacts of these events will be highest in urban areas in China.
To date China has implemented a number of policies to curb emissions, which analysts estimate will realise 4.5 billion tonnes of reductions in 2020 — the largest policy-based emissions reduction in history. The next Five Year Plan (2016-2020) which is due to be released by the end of 2015 will include plans for the acceleration of strategies to meet its longer term climate goals.
China has rolled out seven emissions trading schemes (ETS) in Guangdong and Hubei provinces and five cities (Beijing, Shanghai, Shenzhen, Tianjin and Chongqing). These markets account for 700 million tonnes (more than twice the size of Australia’s previous carbon market and the second largest market after the EU) and will inform a national market which is expected to commence in 2016 of 2017. By the end of this year, China plans to have 100 Gigawatts of on-grid capacity available from wind power, 21 Gigawatts from solar and 290 Gigawatts from hydro sources. In terms of air quality, China announced a US$277 billion investment over 5 years to reduce air pollution in 2013, and in the same year it also launched the Clean Air Action Plan. China’s State Council published an Energy Plan that places an annual limit of 4.2 billion tonnes of coal consumption by 2020. Two major coal fired power stations in Beijing have been closed this year, and the remaining coal fired stations will be closed next year.
The results to date indicate that China has made significant gains although additional measures are required for this trend to continue. Renewable sources now constitute 20% of China’s electricity, and in 2013 China became a world leader in new solar capacity (11 Gigawatts), wind (16 Gigawatts) and investment in smart grid technologies ($4.3 billion). China has reduced its coal use (3% in 2014 and a further 2.5% this year), driven by clean energy policies and a shift towards increased use nuclear, hydro and renewable sources.