Paris Climate Agreement Explained: Next Steps for China

Paris has become a symbol of hope and commitment for the future, as more than 195 countries reached a historic agreement to protect the climate from the most dangerous impacts of climate change. As my colleague Jake Schmidt explains here, this ambitious agreement will include new climate commitments from all major countries and set in motion efforts to require deeper emissions reduction commitments from all countries over time. Specific to China, Alvin Lin details precisely why we can trust China to meet its climate commitments under the Paris Agreement.

What China has pledged: China has committed to peak its CO2 emissions by 2030 and to make best efforts to peak earlier. It will increase non-fossil energy to 20% of its energy consumption by 2030, which will require it to install 800 to 1,000 gigawatts in non-fossil capacity, equivalent to the entire current US generating capacity. China has shown leadership in putting a price on carbon by committing to build a national cap and trade system, which will launch in 2017 and become the world's largest. It has also pledged 20 million RMB ($3.1 billion USD) to the South-South Climate Cooperation Fund to help developing countries address climate change. Other China climate commitments relate to carbon intensity, adaptation and forestry.

Efforts to Date: China has already been working for a number of years to reduce its CO2 emissions, improve energy efficiency, expand renewable energy and develop low carbon cities. China is on track to meet or even exceed its Copenhagen climate pledge, which was to reduce its carbon intensity by 40-45% below 2005 levels by 2020. China is responsible for over half of the world's energy conservation efforts over the past two decades. China has also installed 40 percent of the world's newly added renewable energy power over the past five years, while the country's investment in clean and renewable energy exceeded the combined total invested by the U.S. and Europe.

Next steps: So what are the next steps for China in implementing the Paris Agreement? Here are some of the major ones:

Incorporate the agreement into national and local Five Year Plans: China's Five Year Plans are the government's major development blueprints for long-term social and economic policies. The 13th Five-Year Plan, which will cover the 2016-2020 time period, will be adopted in March 2016, to be followed by five-year plans for specific sectors and local governments. These plans will be an important vehicle for China to implement and operationalize its climate commitments. The government has already announced that "Green Development" will be one of the five major principles underpinning the policies for China's long term growth.

Cap coal consumption: Putting a lid on coal is the single most important step China can take to protect the climate, since coal is responsible for 80% of China's CO2 emissions. A national cap on coal consumption would not only cut carbon, but also clean up China's choking air pollution, save thousands of lives and create more clean energy jobs than would be lost in the traditional coal sector. It would also help address the proliferation of new coal-fired plants, which local governments continue to approve despite existing coal-fired plant overcapacity a continuing drop in electricity demand.

Develop a priority dispatch policy for renewable power: In the September 2015 US-China agreement, China committed to adopting a clean electricity dispatch system that will prioritize power generation from renewable sources. This is critically important because, even though China now leads the world in wind and solar energy, its current electricity system still continues to give precedence to coal-fired power plants, operating these plants in order to meet minimum contracted hours, rather than operating lower-emitting renewable power plants.

Scale Up Green Buildings: China pledged in the September US-China agreement to ensure that 50 percent of all new urban buildings will meet China's green building standards by 2020. This is a critical building block for China's climate efforts, since buildings account for about one-quarter of China's energy use, and the number of new buildings is expected to triple by 2030. Meeting this target will require an enormous effort, since only 2 percent of new urban buildings were green buildings in 2012, and the previous goal was 20 percent by 2015, set by the State Council in the 2013 Green Building Action Plan. But it also represents an enormous opportunity for green building companies in the US and elsewhere to participate in this expanding market.

Clean Up Transportation: China pledged to ensure that the share of public transit in all motorized urban transport reaches 30% by 2020 - presenting the potential for more huge reductions in CO2 emissions. This will require the growing number of medium-sized cities in China to make major investments in subways, buses and other public transport. China also announced that it will finalize next-stage fuel efficiency standards for heavy-duty vehicles in 2016 and implement them in 2019. This is critically important because China now has the world's second largest vehicle population after the U.S.

Continue to work to reduce highly potent short-lived climate pollutants like HFCs and black carbon. Under the U.S.-China September 2015 agreement, China has pledged to accelerate its efforts to control super greenhouse gas HFCs, including "effectively controlling HFC-23 emissions by 2020". China will also cooperate with the U.S. to reduce HFCs, which are widely used in air conditioning and refrigeration, but for which companies have already found and are continuing to develop climate-friendly replacements.

China's Ministry of Transportation has also just released a roadmap for controlling air pollution and greenhouse gas emissions from shipping, one of the fastest growing sources of transport greenhouse gas emissions. Shipping is currently responsible for almost 3 percent of global CO2 emissions and over 2 percent of global black carbon emissions, the second most potent climate pollutant behind CO2.

Continue to Strengthen China's GHG Monitoring and Reporting System: The new Paris Agreement contains strong provisions for all countries to regularly report their emissions and progress made towards achieving their emission reduction targets. China will need to continue to develop and strengthen its domestic rules for monitoring and reporting GHG emissions, including finalizing the mandatory GHG reporting system for all key industrial sectors that it began last year.

Avoid High Carbon Investments Overseas: China made another important commitment in the September 2015 U.S.-China climate agreement: to "strengthen green and low-carbon policies and regulations with a view to strictly controlling public investment flowing into projects with high pollution and carbon emissions both domestically and internationally". This commitment is very significant, especially given the existing trend for China to finance fossil fuel investments in other countries. The New York Times reported today that since 2010, Chinese state enterprises have finished, begun building or formally announced plans to build at least 92 coal-fired plants in 27 countries. It will be very important to for China to exercise its leadership in the BRICS New Development Bank, the Asian Infrastructure Investment Bank, and the Silk Road Fund to ensure that all public investments meet strong low-carbon guidelines.

Now that the Paris Agreement has been reached, we look forward to seeing China's continued climate leadership, and to work with our Chinese partners on reducing coal consumption and GHG emissions, expanding renewable energy, improving efficiency and developing low carbon cities.


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