China’s blueprint goes green: draft economic plan favours renewables over coal

Intro

China is signalling a shift towards a cleaner, healthier and more prosperous future this week, as it considers how to clean up its economy and tackle climate change. According to a communique (link in Chinese) released yesterday on the adopted proposals for the 13th Five-Year-Plan – a blueprint for the nation’s economic and social development between 2016 and 2020 – China is aiming for a “more exacting environmental protection system”, more clean energies and tighter control of coal. The new plan is the latest sign that change is already happening in China and further afield. Economies are slowing down, and overcapacity and air pollution control measures are starting to take their toll on coal in China and abroad. In China, strict rules over a national carbon market are emerging, and polluters have just been found responsible for environmental damage in a landmark lawsuit. In under four weeks, China will join other countries in Paris to sign an agreement to help decarbonise the global economy , yet as commentators and studies warn, countries including China need to accelerate the energy transition to secure huge health, environment and economic benefits for their people.

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Key Points

  • China’s new plan is good for the environment, health, and economy, and bad for coal. China is signalling a “fundamental” shift away from dirty coal towards renewables for a better livelihood and sustainable prosperity. China has for the first time prioritised environmental protection and green growth when setting the course for its economic and social development between 2016 and 2020. Experts are calling for the restriction of coal , and for clean energies, especially solar and wind, to be the focus of the energy development for the next five years, so as to become “moderately well-off” in a carbon-constrained world.  
  • Green growth is the key to ending poverty and improving health in China. Air pollution mainly caused by burning coal is linked to millions of premature deaths a year. As renewables become competitive in many markets, mounting evidence shows that a rapid transition towards clean energies will help China secure huge health, environment and economic benefits for its own people.  

Background

In the Fifth Plenary Session of its 18th Communist Party of China (CPC) Central Committee, China has adopted the proposals for its13th Five-Year-Plan, a blueprint for its social, political and economic development between 2016 to 2020, which is due to be published next March.

According to its communique released after the fourday meeting, China will prioritise environmental protection and green growth to end poverty, improve environmental protection, and achieve “moderate prosperity.”

The NDRC will then finalize the FYP, based on the recommendations in the meeting this week, and expert suggestions and public comments in the next couple of months. The final FYP will be approved by the National People’s Congress, the country’s top legislature, during meetings in March 2016. The 13th FYP will be the first under President Xi Jinping’s leadership. It is considered strategically important as China aims to achieve “a moderately prosperous society in all respects by the centennial anniversary of the founding of the CPC” by 2020.

With its pledge to the UN to peak its emissions around 2030 and increase its share of non-fossil fuels in primary energy consumption to around 20 percent by the same year, with  the administrative rules of a national carbon market emerging, and with polluters starting to be held responsible for their impacts by law, China is signaling a shift away from coal and dirty fossil fuels.

Polluters are facing increasingly serious scrutiny with strict penalties. China’s NGOs have just won a landmark environmental lawsuit against a mining company for damaging vegetation in a southeastern city, the first result of its kind since the issue of amended environmental protection law that took effect on January 1, 2015. And  the National Development and Reform Commission (NDRC), China’s planning agency, is crafting administrative rules to set strict penalties over polluters that fail to comply with the emissions reduction cap. The national carbon market, which, once established, will likely surpass the EU ETS as the world’s largest, will kick off in 2017.

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Key Quotes

  • “The five key points [-innovation, coordination, the environment, opening up and sharing-] highlight the experience of China’s development and all of them aim to achieve the comprehensive development of the human being.” – Hu Angang, an economics professor at Tsinghua University
  • “The upcoming FYP, which will run from 2016 to 2020, is likely to be a good deal more ambitious than the 2011-2015 plan, as China widens the range of pollutants it wants to control and sharpens enforcement of environmental laws. Now that we’re near the end of the 12th FYP, we can see that there were also some gaps, especially with regard to implementation of air and water standards, PM 2.5 air pollution, poor soil quality, and the continuing high consumption of coal.” – Alvin Lin, China Climate and Energy Policy Director of the Natural Resources Defense Council
  • “China will enforce a strict limit on total coal consumption, and continue to cut production.” – Li Haofeng, deputy director of the coal office under the National Energy Administration
  • “Now, we are just talking about this in the new five-year plan—whether we go to zero new coal-fired power plants.[…] They will automatically stop. There is no market, they are dying.” – Jiang Kejun, research professor at the Energy Research Institute of the National Development and Reform Commission (NDRC)

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