China omits firm energy intensity target for 2022
The Chinese government has not set a firm annual target for energy intensity – energy consumption per unit of GDP – in this year’s work report
, which is different to what it usually does. Instead, it pointed to the necessity of having some degree of “flexibility” in assessing energy intensity, a key metric that China uses to evaluate its climate action. It noted that the target would be “assessed comprehensively” within the 14th five-year plan
(FYP) period, which suggested that, instead of setting a specific target for this year, the government would follow the energy intensity objective in the 14FYP. (The 14FYP aims for a 13.5% reduction in energy intensity from 2021 to 2025.) The energy intensity assessment was listed as one of the government’s “main goals” for 2022 – along with increasing employment, limiting inflation and others.
Another climate-related main goal for 2022, according to the report, is to exclude newly added renewable energy, as well as the “energy consumed by raw materials”, from total energy consumption. The goal was first raised
by the central government’s annual economic planning meeting last December. Experts previously told
Carbon Brief that not counting newly added renewable energy into total energy consumption could encourage power users – especially energy-intensive businesses – to consume more clean energy. (According to Shanghai-based financial outlet Yicai
, “raw materials” refers to when energy products, such as oil, coal and gas, are used as the ingredients for producing commodities instead of being used as a form of fuel. The head of the National Bureau of Statistics said the term mainly concerns coal-to-chemical and oil-to-chemical industries, Yicai reported.)
China’s premier, Li Keqiang, delivered the latest government work report during the “two sessions” – a series of key political meetings that take place in Beijing each spring. (Carbon Brief has explained the significance of the “two sessions” in this Q&A
.) The report was written by the State Council, China’s highest organ of state administration. It reviewed the government’s work in 2021 and set out the main targets and tasks for the government for 2022. This year’s report underscored the importance of stabilising the economy.
Li presented the work report last Saturday at the opening meeting of the fifth session of the 13th National People’s Congress (NPC). Each year, the gathering of the NPC – China’s top legislative body – is one of the two “sessions”. The other is that of the National Committee of the Chinese People’s Political Consultative Conference (CPPCC), the country’s top political advisory body. According to China’s state broadcaster CCTV, this year’s CPPCC
meetings opened last Friday and will run until today, while the NPC
meetings began on Saturday and will close tomorrow.
Shanghai-based news website Jiemian
said this year’s work report indicated that China’s energy policy had become “more pragmatic”. Dr Tao Jin
from the Suning Institute of Finance in China told the website that stabilising economic growth would be the government’s main task for the year and a flexible energy intensity target could facilitate that. Dr Tang Yao
– an associate professor at Peking University – told the outlet that the government had set a non-concrete target out of overall consideration for the economy, energy and environment. Prof Zeng Ming from Northern China Electric Power University in Beijing told Yicai
that the “timely” adjustment could prevent local governments from cutting electricity or limiting factory production just to meet energy targets, as happened last year. He said the directives meant that, instead of focusing on individual targets, the government would look at a host of different elements, including carbon emissions, energy-related economic targets and “security” factors.
COAL ‘WAS BACK’:
According to the National Bureau of Statistics
, China’s energy intensity dropped by 2.7% last year. In comparison, last year’s government work report
had set the target to reduce “by 3%” in 2021. Prof Lin Boqiang – dean of the China Institute for Studies in Energy Policy at Xiamen University in China – told Yicai that China’s energy consumption increased “dramatically” in 2021. He added that, despite its fast growth, renewable energy could not meet the soaring demand, especially during peak times. Therefore, coal “was back” and the country’s energy intensity “was higher” last year compared to a scenario when coal production had not been ramped up, Prof Lin noted.
In other related instructions, this year’s government work report underlined the importance of ensuring energy security and carrying out energy transition in an “orderly” manner. (On Monday, the state economic planner explained
how China plans to enhance energy security in 2022.) The report said that the government intended to “promote” a switch from its current “dual-control” policy – which caps total energy consumption and energy intensity – to a new “dual-control” policy that restricts total carbon emissions and carbon intensity (carbon emissions per unit of GDP).
A team of researchers from the State Grid Shanghai Electric Power Research Institute analysed the significance of the “dual-control” shift in State Grid News
, the official newspaper of China’s State Grid. The article said the switch could “effectively” solve the problem of local authorities limiting businesses’ electricity usage to hit targets. The piece explained that the energy intensity “dual-control” policy directly determines the amount of energy companies can use. In contrast, the new carbon intensity “dual-control” policy caps the level of their emissions. Therefore, the move sends a “more direct and clearer message of reducing emissions” and could guide firms to use more “green” electricity. The authors noted the two policies were “likely to coexist in the long run”. (China introduced the idea of an absolute cap on carbon emissions in the 14FYP, but did not specify a number.)
The government work report also pointed to four achievements in 2021: namely, the surpassing of 1,000 gigawatts
(GW) in the installed capacity of renewable energy generation; the publication of the carbon-peaking action plan
; the launch of the national emissions trading scheme (ETS
); and the “active” tackling of climate change.
WESTERN COVERAGE: Bloomberg
reported that anyone hoping China would use the “two sessions” to speed up its action on climate change “was left sorely disappointed”. On the energy targets, the outlet said that the last time China “avoided” an annual target for energy intensity was 2020 during the country’s initial fight against Covid-19. It added that the leaders “reiterated several accounting changes” that would enable the country to burn more fuel while still hitting its energy intensity target in the 14FYP. A separate
Bloomberg report said that China “shuns” the energy intensity target “to focus on securing fuel supply”. Reuters
reported the “concern” from “environmental groups” that China could “backslide” on its environmental commitments due to its priority for the economy. In addition to the lack of the annual energy intensity target, the work report “also said China would not include major national projects in state energy consumption control targets”, Reuters said.
Commenting on the government work report, Prof Alex Wang
– the faculty co-director of the Emmett Institute on Climate Change and the Environment of UCLA School of Law in the US – told Carbon Brief: “The key takeaway is that energy security and continued development are to be core priorities to be balanced against the ‘dual-carbon’ goals. The message is not surprising in a period of economic uncertainty, but it is worrisome from an environmental perspective. This year’s NPC meeting has emphasised economic growth. Official comments on climate policy have continually emphasised the need to move cautiously on coal reduction. Perhaps, this is just a call for ‘smart’ decarbonisation, but it is hard to see how this does not also mean ‘slower’ decarbonisation.”
Xi issues new orders on achieving carbon neutrality
China’s president Xi has instructed the country to go “steadily” and not to “hurry” while striving towards the goal of carbon neutrality in a recent meeting, reported People’s Daily
– the official newspaper of the Communist Party of China. According to the paper’s readout, Xi said that, as the world’s largest developing country, China intends to achieve the world’s “sharpest drop” of carbon emissions, using the “shortest time” to go from the carbon peak to carbon neutrality. He acknowledged that, as the whole country pursued the goals with “action” and “unity”, some regions “inevitably” went “too fast” and “too drastic”. Among other things, Xi cautioned against “campaign-style
carbon reduction” and “sudden brakes” while trying to meet the “dual-carbon” goals.
XI: While Xi mostly repeated his previous orders in his address, the People’s Daily highlighted one of Xi’s quotes: “We cannot throw away our means of living first, only to find that our new livelihood has yet to arrive. (不能把手里吃饭的家伙先扔了，结果新的吃饭家伙还没拿到手，这不行。)”
According to People’s Daily, Xi made the remarks last Saturday during an NPC meeting of the Inner Mongolia delegation at the “two sessions”. Inner Mongolia is one of China’s top three coal-producing regions. According to official statistics, it produced 1bn tonnes
of “raw coal” in 2021, a quarter of the national total
WHO: People’s Daily said that Xi delivered the address after listening to a report made by a representative of a coal-to-chemical company based in Baotou, a major industrial base in Inner Mongolia. The representative, named Jia Run’an, talked about how the coal-to-chemical industry could “assist” China’s carbon peaking and carbon neutrality by developing in “high-end, diversified and low-carbon” ways, People’s Daily said.
SIGNIFICANCE: China News Service
, a Chinese state-run newswire, interpreted the quote highlighted by People’s Daily. It said that Xi had made three points. First, Xi had noticed the “unrealistic” and “overzealous” efforts to reduce emissions and wanted to stress that “normal life and production” are as important as the environment. Second, Xi emphasised that coal would be the “mainstay” of China’s energy mix for the short term and hitting climate goals must be based on this “national reality”. Third, Xi wanted to reassert the instruction of “establishing [new rules] before breaking old ones
”, an order he had given last July. (Carbon Brief has explained the previous order in this article
QUOTES: Byford Tsang
– senior policy advisor at E3G, a climate change thinktank – told Carbon Brief that Xi’s latest words reiterated his previous message of “establishing first, breaking later”. He explained that Xi was speaking “more metaphorically” this time by referring to China’s current power system as the “means to make a living”. He added that it was “notable” that Xi had said those words to delegates from Inner Mongolia, “where the coal industry is one of the primary ‘means to make a living'”.