Global climate: China eyes Australian ETS model

As the Gillard government prepares to introduce its carbon price legislation to parliament, senior environment policy advisers…

China says it has encouraged a domestic renewable energy industry and is now planning a pilot emissions trading scheme. Flickr/Land Rover Our Planet

As the Gillard government prepares to introduce its carbon price legislation to parliament, senior environment policy advisers from big emitters China and India have said they are watching closely Australia’s climate policy debate.

China remains the world’s biggest polluter, emitting more CO2 than the US and Canada put together.

However, China argues that its per capita emissions are well below that of Australia and the US and that it has a right to lift millions of Chinese out of poverty through economic development.

Despite the huge emissions that come with China’s rapid economic growth, Beijing says it is working hard to promote renewable energy use.

The country’s latest Five-Year Plan features targets to cut energy intensity (energy consumed per unit of GDP) by 16% and carbon intensity (carbon dioxide emitted per unit of GDP) by 17% by the end of 2015. That is less than the 20% target that featured in the previous Five Year Plan, which led to local officials imposing power cuts to meet their goals.

In this edited Q+A, IPCC lead author Dr Jiang Kejun, head of energy and environmental policy analysis at the Energy Research Institute of the National Development and Reform Commission (China’s macroeconomic planning agency), explains how China views the global climate debate and outlines some of his country’s emissions reduction policies.

Dr Kejun visited Australia as a guest of the Australian government’s Climate Commission and spoke at a forum at Sydney Town Hall on Monday.


At today’s forum we saw a few interruptions by climate skeptics, including one who had to be removed by security. Is climate change skepticism growing in China?

I was surprised to see this. In China we don’t have too many. Of course, we observe some people are arguing that climate change is not true but they are not researchers.

Climate change is very complex. But the (IPCC’s) fundamental conclusion is that climate change is happening and CO2 emissions can increase the future risk of climate change and so far the most of climate change is driven by human actions.

I think most people in China believe that.

(Regarding climate skepticism) it’s quite interesting to observe what is happening in Australia and the United States. Maybe here people are more well educated so they can argue a lot.

In China, many people believe what scientists say.

Why, if China is so serious about reducing it’s climate change impact, are emissions growing at 10%?

Because of the population. Most of the farmers in the rural population, which accounts for 57%, cannot take a shower once a month. They cannot afford it. If you go to a rural area, please look at what their life is like.

So the fundamental homework for the Chinese government is still to make people richer, to let them have, not necessarily as good a life as you see here or in the United States with a big house, but provide for their fundamental living needs and space.

With such a huge population and living standards still low, we can see emissions still need to keep going. But we try to find solutions. If more of the energy can come from renewables, then maybe emissions can be reduced.

We are looking at other countries. Europe did a good job on renewable energy and China is looking at their experiences but even Europe cannot get more than 20-25% of energy from renewable energy, because of technical difficulties.

Provincial governments in China are given environmental targets but they also have GDP targets. Which one is more important?

They are still putting GDP first. This is the trouble. Even the central government realises this is a serious problem. That’s the reason we have taken it down to 17% (from 20% in the previous Five Year Plan).

The energy intensity target is energy use divided by GDP. So if they have a higher GDP, they have higher energy use so they still should be able to reach their target.

The government is serious about the environmental targets. They must reach these targets. Every year a group is sent to each province to check and give a score for each governor. This makes the governor very nervous and is a very serious thing in China. If an official wants to be promoted, they have to do a good job on their targets.

You have said you are watching closely what Australia is doing. What aspects of our climate policy do you think could work in China?

China wants to do emissions trading but so far we don’t know which emissions trading scheme we should do.

That’s the reason why we are setting up six pilots trading schemes in provinces: Guangdong, Shanghai, Hebei, Chongqing, Beijing, Tianjin. So I think this will affect more than 250 million people.

We look at what’s happening in Europe, what happened in the US and what happened in Australia. And also Japan has proposed to do some emission trading. So we look at everything together to see what’s good and bad and then we will have a review to see what China can do.

Maybe by 2013 we will start the pilot and by 2015 we can do a nationwide scheme. It depends on the pilot.

We are waiting to see what happens in Australia. So far it’s better Annex 1 countries (developed countries) take action first, to find a solution and that’s then a solution not only for Annex 1 countries but for everybody.

China can also support those solutions and work together.

China has committed to cutting carbon intensity by 40-45% on 2005 levels by 2020. Do you foresee those targets changing?

I think we will hold onto that target.

How would a double dip recession in the US and economic problems in the EU affect China’s environmental targets or green technology industry?

If the EU and the US had some trouble with their economy, this will reduce the imports from China.

So I think it’s a good time for China to really restructure our economy. Personally, I think it’s a good opportunity for China to think about what is the new economic development pattern. We cannot really rely on manufacturing a lot of steel, cement. This is not the long term way for China’s economy.

Let’s think about the new patterns and think of something for the future.