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Opinion | How China can solve its energy ‘trilemma’ and avoid a climate policy swing
- The sometimes competing needs of energy security, economic viability and environmental protection are an especial challenge for China’s top-down system
- Beijing should complement its decision-making on climate with a bottom-up approach to avoid drastic policy swings, such as on coal
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Observers of China may have noticed an interesting phenomenon in its political and economic arenas: a cycle where strict control leads to stagnation, followed by an abrupt change towards a total delegation of responsibility, which results in disorder and chaos. This cycle has been most evident in China’s recent Covid-19 policy change.
But China’s climate actions in recent years have also shown signs of going through this cycle. Following its climate pledge in 2020 to reach peak carbon emissions before 2030 and achieve net zero by 2060, China saw a wave of “campaign-style” carbon reduction efforts.
There was a surge of climate-oriented policies and initiatives by governments at various levels. In some regions, factories were forced to close down and the power supply was cut as local governments came under pressure to hit energy control and carbon emission targets.
But a notable policy swing took place after the country was hit by energy supply shortages and soaring prices. Contrary to previous strict controls on coal to cut emissions, China’s coal output has been boosted since the second half of 2021.
Last year, 300 million tonnes of new coal production capacity was approved, on top of the estimated 220 million tonnes added in 2021. Coal output in the country reached a record high of 4.07 billion tonnes in 2021; and again in 2022, with a further increase of 8 per cent, to 4.45 billion tonnes.
More worrying is the significant policy change on coal power projects. According to a study by Peking University’s Energy Research Institute, the government approved 65 gigawatts of new coal power projects in the first 11 months of 2022, more than three times the capacity approved in the whole of 2021. Once in operation, these new coal-fired power plants will pose a challenge to China’s carbon emission reduction efforts for many years.
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