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Climate change: China’s decarbonisation policy fine-tuning lifts shares of renewable energy, grid solutions providers
- Changes to China’s decarbonisation policy will bolster demand for renewable energy and infrastructure that support its growth, analysts say
- Renewable energy projects and raw materials producers will be exempt from energy volume and intensity caps
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The latest changes to China’s decarbonisation policy will bolster demand for renewable energy and infrastructure that support its growth, according to analysts. Stocks of companies in related fields surged.
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At the annual central economic work conference that ended on Friday, which sets the economic agenda for the year ahead, policymakers called for the focus to shift away from energy consumption volume and “intensity” – energy consumption per unit of gross domestic product – towards carbon emission volume and intensity metrics.
As part of the policy shift, newly installed renewable energy projects and industrial raw materials producers will be exempt from the energy volume and intensity caps, according to a statement from the State Council, China’s cabinet.
The change is consistent with the nation’s overall decarbonisation direction and objectives, and gives companies a clearer direction in doing their part to help achieve them, according to Wang Xiaoshu, the head of ESG and climate research at stock indices compiler MSCI.
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China's largest offshore wind farm ready to start operations
China's largest offshore wind farm ready to start operations
“Some companies, after improving their energy usage intensity, are facing technical bottlenecks to further lower it, so an impetus to slash emission volumes or intensity will give them the motivation and flexibility to look at wider options – such as adopting cleaner energy,” she said during a media webinar on Monday.
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