China Environmental Law

A discussion of China’s environmental and energy laws, regulations, and policies

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Notable Margins

November 27th, 2009 · No Comments

In September President Hu Jintao announced at the United Nations that China would reduce the amount of its carbon emissions per unit of GDP by a “notable margin.”  We now have China’s definition of notable.  It means 40-45% reduction from 2005 levels by 2020 (at the high end, that’s 3% off 2005 emissions per year).  If you have a sense you have seen these numbers before, you have a wonderful memory.  They have been batted around since at least 2007, and China has hit these targets for the past couple of decades all the while churning out greater amounts of carbon emissions.  Indeed, it was estimated by the World Resources Institute in 2007 that

China’s GDP is projected to grow around 400% by 2020. So even with a 40% intensity cut, emissions in the absolute sense would increase by 250%. That growth would make China the biggest national emitter by far, and [pose] a daunting challenge for reducing GHG emissions.

While the announcement was rolled out with much fanfare and supporting cameos by the usual suspects, including Pan Jiahua, it was greeted by most observers with little enthusiasm.  I fall into this category, but there are a few things to be thankful for.

For one, it used to be that if you were asked what China was doing on climate change, it was necessary to compile laundry lists of initiatives (20% energy efficiency improvements over 2005 levels by 2010, aggressive renewable energy targets, etc.) that have the effect of reducing the growth rate of carbon emissions.  With the exception of China’s afforestation efforts, this carbon intensity target should encompass all of the other initiatives.  It will be nice to have only one metric that covers everything else and is expressed explicitly in terms of carbon.

In order to perform the measurements necessary to track achievement of this new goal, China will need to increase its capacity to measure its carbon emissions.  There are several NGO-sponsored programs already under way to help China build capacity in this sector, and the US EPA recently entered into an agreement in which it “may” help China with these efforts.  That agreement needs to be amended or supplemented post haste, to actually get a cooperation program up and running.

A carbon specific goal that will drive carbon emission measurement capacity building, so far so good; the bad news is the notable margin isn’t nearly notable enough.  As stated above, given China’s projected GDP growth rates, the amount of carbon that China will continue to emit into the atmosphere will continue to increase at a mind-boggling rate.  Since this proposal doesn’t actually result in any additional reductions of carbon over and above what China is currently doing (although there are no guarantees it would continue with the same energy intensity goals, for instance, post-2010), it is hard to see how this announcement does much for projected atmospheric carbon levels.

The McKinsey study China’s Green Revolution estimates that if China continues to grow at an annual GDP growth rate of 7.8%,

  • AND continues to meet its aggressive energy intensity reduction goals,
  • AND installs all the renewable energy called for its current medium- & long-term renewable energy plan,
  • AND otherwise achieves a 4.8% annual growth rate in carbon efficiency, (which is significantly higher than the annualized amount of the target China just announced),

then it will more than double its 2005 carbon emissions by 2030.  That doesn’t sound good.

In addition, China has taken pains to make it clear that this is a purely “domestic” target.  That means that China’s opening position is that it will not enshrine these goals in the context of an international climate change agreement.  You may be confused having read that China agreed with the US to “stand behind” its carbon reduction commitments.  Whatever the term “stand behind” meant, it did not mean fully measurable, reportable, and verifiable (MRV).  I don’t think China is reneging on any deals here because I don’t think there were any deals on MRV in the first place.  If these commitments are not MRV, they will not go very far in closing the gap with the US in terms of a deal at Copenhagen or beyond.

I think this is a lowball bid, but if there is to be significant improvement in the intensity improvement percentage, China is going to expect the developed countries to pay up.  All in all, good concept, disappointing initial proposal, but room for improvement; it certainly doesn’t make a Copenhagen deal any less likely.

Tags: US-China relations · carbon emissions · climate change

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