China’s Road to Carbon Peaking and Carbon Neutrality

Human activities, as climate science increasingly shows, are in all probability the major causes of global warming, and also increase the likelihood and severity of extremely high temperature, precipitation, drought and tropical cyclones. Not only does the problem of climate change endanger the structure and functions of natural ecosystems, but it also impacts the running of the economy and society, and constitutes a threat to international peace and security.

During the general debate of the 75th session of the UN General Assembly held on September 22, 2020, President Xi Jinping announced that China will scale up its Intended Nationally Determined Contributions, strive for carbon peaking by 2030, and achieve carbon neutrality by 2060.

At present, the world has basically reached a political consensus to promote economic and social transition, say no to resource dependence, and move towards carbon neutrality. China’s “dual carbon” goals not only are intended to protect the environment, but also dovetail with the UN Sustainable Development Goals, Long-Range Objectives Through the Year 2035, the second centennial goal, etc., as well as meet the essential requirement of the paradigm shift of social-economic development. Han Zheng, a member of the Standing Committee of the Political Bureau of the CPC Central Committee and Vice Premier, stressed that “we must respect the law, seek truth from facts, base ourselves on reality in everything we do, and keep a scientific pace of work” in the process of achieving carbon peaking and carbon neutrality. We can conduct targeted emission reduction actions and improve efficiency by analyzing the essential issues of carbon peaking and carbon neutrality, and comprehending the economic logic of energy saving and carbon reduction.

All countries are seeking new economic development drivers and needs in the wake of the 2008 international financial crisis. The “dual carbon” goals objectively call for restructuring the energy system, promoting decarbonization in the energy supply system, and achieving electrification for end-use energy consumption. In order to offset the unavoidable carbon emissions, it is also necessary to remove carbon emissions by means of CCS, afforestation, and so on.

The realization of carbon peaking and carbon neutrality is not only an energy revolution, but a technological revolution as well. To date, China’s economic development is not yet completely decoupled from carbon emissions. The key to balancing development and emissions reduction is to cut technology costs, build new industries and create new drivers of growth through scientific and technological innovation.

Consumption is a basic part of the performance of the national economy. In 2020, China’s final consumption expenditure accounted for 54.3% of GDP. Consumption has become the primary driver of China’s economic growth. At the same time, energy consumption and carbon emissions from the personal consumption sector are also increasing. Therefore, controlling consumption- side carbon emissions is also a key player in carbon peaking and carbon neutrality.

To achieve the “dual carbon” goals, China must strive to make systemic changes in the economy and society in light of reality. We should, centering around the green and low-carbon goals, develop new and renewable energy industries, as well as energy storage and carbon recycling technologies and industries. For high energy consumption and heavy pollution, we should make obsolete backward technologies, processes and products.

Of the various policies and campaigns to tackle climate change and reduce greenhouse gas emissions, the carbon pricing mechanism is a type of fiscal and tax policy. A message is sent through the pricing of carbon emissions: carbon emissions must be paid, thereby promoting economic entities to reduce greenhouse gas emissions, guide a low-carbon transition in production, consumption and investment, decouple economic growth from carbon emissions, achieve carbon peaking as soon as possible, and ultimately achieve carbon neutrality. As a key carbon pricing mechanism, the carbon market is widely used in the global response to climate change. As delineated by statistics compiled by the World Bank and the International Carbon Action Partnership (ICAP), as of January 2021, a total of 46 countries or jurisdictions globally have inaugurated carbon pricing frameworks. This encompasses 31 carbon market systems and 30 carbon taxation policies, enveloping carbon emissions approximating 12 billion metric tons of CO₂ equivalent, which constitutes roughly 22% of the global greenhouse gas emissions. These frameworks are geographically dispersed, extending across North America, Europe, Africa, South America, and Asia. Within the People’s Republic of China, the prevailing carbon pricing architecture is a carbon market mechanism. As articulated by President Xi Jinping at the 75th United Nations General Assembly, achieving the ambitious objectives of attaining a peak in carbon emissions by the year 2030 and realizing carbon neutrality by 2060 necessitates the enactment of “more robust policies and measures.” This mandates a profound advancement of carbon pricing mechanisms to optimally leverage the efficacy of pricing strategies, thereby galvanizing societal efforts toward the ultimate goals of peaking carbon emissions and achieving carbon neutrality.

Cities are a key space and actor to promote the transition to a low-carbon economy as well as high-quality economic and social development. China has always attached great importance to the initiative and creativity of cities in the effort to achieve climate action goals. The National Development and Reform Commission has piloted the low-carbon city program three times in 2010, with good results achieved. For the “dual carbon” goals, cities, as the “pioneers”, will enjoy a strategic window period for green transition with increasing policy support. Under the rigid constraint of carbon emissions, cities will move faster to explore a win-win path of emission reduction and economic growth, build confidence to achieve the “dual carbon” goals, endeavor to set an example in carbon neutrality, and better play the role in helping to achieve the “dual carbon” goals as low-carbon cities.

The realization of the “dual carbon” goals is a complex system program that involves economic, social, energy, ecological environment and other factors. It requires systematic planning and coordinated promotion by all fields and sectors.

Forestry has been included in the global response to climate change as a key component. It is also an important part of national strategies to respond to climate change. The 2009 Central Forestry Work Conference pointed out that forestry occupies a special position in the response to climate change.