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From China’s climate commitments to action

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A Chinese worker installs solar panels at a photovoltaic power station in Lianyungang city, Jiangsu Province, China, 15 May 2018 (Photo: Reuters/Oriental Image).

In Brief

As the world’s largest carbon emitter, China has a crucial role in the reduction of global carbon emissions through its own commitment and its collective international engagement. Fortunately, in the past decade, China has shifted its stance on international climate negotiations and is making significant commitments to global governance addressing climate change.


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Before the Copenhagen UN Climate Change Conference (COP15) in 2009, China pledged to cut its carbon intensity — its emissions per unit of GDP — by 40–45 per cent by 2020 relative to 2005 levels. While this was consistent with China’s longstanding opposition to hard emissions caps on the grounds that limits could restrict economic growth, the pledge marked a turning point in China’s climate policy. It was followed by a commitment at the 2015 Paris UN Climate Change Conference (COP21) to peak absolute emissions and cut intensity levels by 60–65 per cent by 2030.

In September 2020, President Xi Jinping reiterated China’s commitment to peak carbon emissions by 2030 and announced a goal to achieve carbon neutrality before 2060. Given the unexpected nature of this announcement it was significant when China’s Central Economic Work Conference made ‘carbon peaking and carbon neutrality’ one of the eight key economic priorities for government in 2021.

These announcements are welcome, but commitment without action is meaningless and the global community is concerned about how China will honour its commitments.

Achieving peak carbon and carbon neutrality will require China to rapidly decarbonise its economic and energy structures. China has established the 1+N framework, which sets out the policies and actions required across economic sectors and in key industries such as energy, industry, transportation, infrastructure and construction. Huge investment in renewable energy, industry retrofitting and new low-carbon or carbon-free technologies is necessary to realise these objectives. Government financing can only cover a small portion. Private capital must close the gap.

China’s national emissions trading scheme (ETS) — launched in July 2021 — establishes a price for carbon in the electricity sector to incentivise investment in low-carbon projects. So far, the price for carbon has remained stable and overall compliance with the scheme is high. But there are significant differences across provinces, particularly measured against the number of entities.

China will need to strengthen its national carbon trading regulations to fully realise the benefits of its price on carbon. It also needs to accelerate the expansion of industries included in the national ETS, diversify market players and increase the variety of tradeable market instruments to deepen market liquidity. The Chinese government should prioritise the inclusion of the steel, cement and aluminium industries in the national carbon market. The petrochemical, chemical, building materials, nonferrous metals, papermaking and aviation industries should be included in the next five years. That will incentivise energy-saving and least-cost carbon abatement.

Because climate change is a collective action problem international cooperation is required to meet the global average temperature targets outlined in the Paris Agreement. If China fulfils its carbon neutrality commitment it could reduce global average temperature rises above pre-industrial levels by 0.16 to 0.30 degrees Celsius. This would greatly improve the chances of achieving the Paris Agreement’s 2 degree target with China’s commitment to climate action having the single largest impact of any country.

Cooperation with the United States — the world’s second-largest emitter after China — is also crucial to fulfilling global agreements. China and the United States issued the US–China Joint Glasgow Declaration on Enhancing Climate Action in the 2020s. The two countries outlined that they will cooperate on regulatory frameworks and environmental standards, clean energy transition, decarbonisation and electrification of end-use sectors, carbon capture, utilisation and storage technologies and increased action to control and reduce methane emissions. Such statements have enhanced the two countries’ commitments to climate action and their follow-through on meeting the Paris Agreement.

China also has a crucial role in helping developing countries to meet their climate ambitions. Developing countries are required to make contributions to global efforts but are not supported accordingly. In 2009, developed countries promised to provide US$100 billion annually — by 2020 — to developing countries for climate change adaptation and mitigation. Although this climate financing pledge was only a drop in the bucket in terms of the financing required to tackle climate change, the commitment is yet to be fulfilled.

As the largest developing country in the world, China understands the difficulties and concerns faced by smaller developing countries and has been helping them obtain climate financing and technical support. China has also pursued an agreement to set up a ‘loss and damage’ fund to support the developing countries most impacted by climate change.

China has made large strides towards achieving carbon neutrality and achieving global climate targets but tackling climate change will require more global cooperation. Current global efforts are insufficient to limit global temperature rises to 2 degrees above pre-industrial levels by the end of the century, much less the desired goal of 1.5 degrees. China and the international community will need to work together towards the shared goal of global decarbonisation. By ensuring countries stick to the commitments made in the Paris Agreement and unlocking financial resources to advance the transition to renewable energy and carbon-free technologies, China, in concert with the international community, can help ensure that the Paris Agreement’s goals remain within reach.

ZhongXiang Zhang is founding Dean and Distinguished University Professor at the Ma Yinchu School of Economics and Director of the China Academy of Energy, Environmental and Industrial Economics at Tianjin University.

This article appears in the most recent edition of East Asia Forum Quarterly, ‘China Now’, Vol 15, No 1.

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