China embarks on realistic path toward decarbonized future

In this monumental year of its green pursuit, China has been persistent in honoring its carbon commitments, with progress and experience gained.

Xu Huaqing, director of the National Center for Climate Change Strategy and International Cooperation, preferred to use "unprecedented" to describe 2021.

"In 2021, there has been unprecedented attention from the central authorities to the work of carbon peaking and carbon neutrality, unprecedented public involvement, and unprecedented challenges and opportunities," he said.

These changes came after China unveiled its ambition to peak its CO2 emissions before 2030 and achieve carbon neutrality before 2060.

This carbon pledge, a major strategic decision based on the country's responsibility of promoting a community with a shared future for humanity and the country's inherent requirements of realizing sustainable development, is not easy to honor.

The pledge means China will go from carbon peak to carbon neutral in 30 years, which is much shorter than the time taken by developed countries. It requires painstaking efforts.

The unusual part of 2021 lies in the unfolding of the country's path toward a decarbonized future, noted observers.

Year one

In 2021, China took dramatic efforts to walk its talk, setting timetables and drawing roadmaps and blueprints for its 2030 and 2060 goals.

Xie Zhenhua, China's special envoy for climate change, said that "2021 is 'Year One' for China to move toward carbon neutrality."

This Year One has witnessed China's release of a top-level design document for peaking carbon emissions and achieving carbon neutrality and an action plan for peaking carbon emissions before 2030.

Specific implementation plans for key areas such as energy, industry, construction, and transport and sectors such as coal, electricity, iron, steel, and cement will be rolled out, coupled with supporting measures regarding science and technology, carbon sink, fiscal and taxation, and financial incentives.

Besides, China's national carbon emissions trading market commenced trading in July.

Companies are assigned quotas for carbon emissions based on their output and industry-specific factors and can sell excess emission allowances to those in need of more pollution quotas. In effect, the system would incentivize the low-carbon transition of firms.

Financial support is also in the country's toolkit to reduce carbon emissions.

In November, China rolled out a targeted re-lending program with a quota of 200 billion yuan (about 31.4 billion US dollars) to support the clean and efficient use of coal, amid a set of financial tools to facilitate green and low-carbon development.

The country's balance of green loans hit 14.78 trillion yuan by the end of the third quarter of 2021, up 27.9 percent year on year. Among the green loans, 66.9 percent have gone to projects with direct and indirect carbon reduction benefits.

Long race

In addition to the promises and policies, China gained a profound understanding of carbon cuts.

During the Central Economic Work Conference, a tone-setting meeting for next year's development, the Chinese authorities noted that achieving the goals requires unwavering efforts and is not a mission that can be done at once.

Han Wenxiu, a senior official with the Central Committee for Financial and Economic Affairs, said that "campaign-style" carbon reductions, which caused power crunches and even outages in parts of the country, deviated from the requirements of the central authorities.

Achieving carbon peaking and carbon neutrality is a complex and long-term task. China needs to seek progress while maintaining stability and consider China's national conditions, such as the domestic energy structure and industrial structure, Han said.

The Central Economic Work Conference highlighted that the phase-out of traditional energy in China should be based on safe, reliable, new-energy alternatives.

Given that coal will remain the country's dominant energy source for the near future, China needs to strengthen the clean and efficient use of coal, increase the absorptive capacity of new energy, and further optimize coal and new-energy applications.

An incentive and constraint mechanism for pollution control and carbon reduction also needs to be established soon, said the meeting.