Strategic Path for Developing China’s Low―carbon Energy
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[a]School of Political Science and Public Management， Southwest University， SWU， Chongqing， China
*Corresponding author.
Supported by the National Social Science Foundation for Youth of China （No. 11CGL104）， the Social Science Foundation for Youth of Education Ministry of China （No. 10XJC630009）， the Major Decision and Consulting Research Foundation of Chongqing （No. ZDKTB120101）， the Soft Science Foundation of Chongqing （No. CSTC2012CX-RKXA0321）， and the Key Program of Fundamental Research Funds for the Central Universities （No. SWU1209316）， and the Doctoral Program of Southwest University.
Received 6 May 2013； accepted 9 September 2013
Abstract
Low-carbon economy influences all aspects of a country. Therefore， every country must faces up to low-carbon economy actively， not excepting China. It is universally acknowledged that low-carbon economy is based on the perfect energy system. However， in general， China’s energy situation is now facing a grim situation. On the base of energy situation analysis， this paper considers that the perfect energy system is the foundation of China’s low-carbon economy， energy conservation and energy efficiency improvement are the most effective ways to develop low-carbon economy in China， development and application of new and renewable energies is the key of optimizing energy structure and raising energy reserves， furthermore proposes the safeguard system and incentive mechanisms of new energy industries. Finally， this paper constructs a systematic framework of China’s renewable energy development. Only by speeding up these steps consistently can renewable energy be successful in China.
Key words： Low-carbon economy； New and renewable energy； strategic path； Systematic framework
WANG Zuojun （2013）. Strategic Path for developing china’s low-carbon energy. Canadian Social Science， 9（5）， -0. Available from： http：///index.php/css/article/view/j.css.1923669720130905.2733
DOI： http：///10.3968/j.css.1923669720130905.2733.
INTRODUCTION
The urgent need to combat climate change is becoming a key determinant of the economic development path of all nations. It is no exaggeration to say that， if we fail to create sustainable， low carbon economies， humanity’s future looks bleak （Sam Nader， 2009）. In recent years， with a series of climate change conferences held by the United Nations， for example， Bali climate change conference 2007 in Indonesia， Copenhagen climate change conference 2009 in Denmark， Tianjin Climate talks 2010 in China， Cancun climate conference 2010 in Mexico， the low-carbon economy is becoming more and more important for the whole world.
As the largest developing country， economic growth remains a priority for Chinese government because China is at the middle stage of industrialization， urbanization and modernization. However， accompanied with the environmental pollution， ecological deterioration and the high increase rate of Greenhouse Gas （GHG） emissions， this growth is， increasingly， being measured by the effectiveness of the steps taken to against the climate change and protect the environment. So， the growth of economy should not be pursued at the expense of environmental pollution in China.
Therefore， China must follow the way of low-carbon economy for coping with climate change， promoting sustainable development， expediting transformation of the economic development pattern， safeguarding national energy security and building the resource-saving and environment-friendly society.
1. THE FOUNDATION OF LOW-CARBON ECONOMY： PERFECT ENERGY SYSTEM
China is at the medium term of industrialization and urbanization， economic growth rapidly will last a long time. However， energy system has been becoming the “bottle-neck” of economic expansion because the second industry proportion is too high， coal continues to dominate energy system and energy demand depends on oil import heavily. So， these basic steps of realizing low-carbon economy must be speeded up energetically such as improving energy system， cutting energy intensity， enhancing energy efficiency， developing renewable energy so as to propel energy conservation and emission reduction.
1.1 China’s Energy Mix Is Now Facing a Grim Situation
As the world’s largest coal producer and consumer China’s economy growth depends heavily on the coal， coal’s consumption is about twice as much as that of America， the world’s second largest coal producer and consumer.
Firstly， China’s energy consumption structure is unreasonable， the proportion of coal consumption is too high. Compared with world’s average value of 27.8% in the world’s primary energy consumption system， lower than 20% in developed countries in 2007， coal consumption is as high as 69.5% in China’s primary energy consumption system. Excessive Coal consumption leads to high “carbon intensity” and obvious “high carbon” feature in the process of economy development.
Facts have shown that there are still a big gap between China and developed countries on energy mix and energy efficiency， this is the important root cause of becoming the largest emission country. Therefore， improvements of energy structure and energy efficiency are the essential prerequisite for the low carbon economy development of China.
1.2 Energy Conservation And Energy Efficiency Improvement Are The Most Effective Ways To Develop Low-Carbon Economy
On the one hand， China carries out the energy development strategy and gives importance to energy conservation and exploitation， but energy conservation should be given priority. In the meantime， energy efficiency improvement contributes to about 54% reductions， is vital to emission reduction （Jiang， Sun， & Li， 2010）. Chinese government has taken many effective measures to propel these works. China has adopted and is implementing the National Climate Change Program， which includes mandatory national targets for reducing energy intensity and the discharge of major pollutants， and increasing forest coverage and the share of renewable energy for the period of 2005 through 2010. By reducing energy intensity alone， China can save 620 million tons of standard coal in the five-year period， equivalent to cutting 1.5 billion tons of carbon dioxide emissions （Hu， 2009）.
Energy efficiency improvement is announced as the first priority of China’s energy policy in the 11th and 12th Five-Year Plan， the revised Energy Conservation Law of China on October 2007 proclaims that energy conservation is a national policy， and so on. In April 2006， China established the ‘‘Top 1000 Enterprises Energy Conservation Action Program’’. These enterprises consumed 33% of the national total and 47% of industrial energy consumption in 2004. The program aims to save 100 million tce cumulatively during the period 20062010， thus making a significant contribution to China’s overall goal of 20% energy intensity improvement （Zhang， 2010）.
In addition， governments encourage people to buy energy saving and new energy vehicles， build new energy saving civil buildings through strictly implementing energy efficacy standard. In addition， Chinese government adjusts vehicle purchase tax or excise tax， carries out automobile rural discount policy and household electrical appliances to rural areas.
On the other hand， Chinese government speeds up “close down， suspend operation， merge with others or shift to different line of production” and “eliminate backward production capacity”， encourage construction of large， more efficient and cleaner units. On August 8th 2010， Ministry of Industry and Information Technology of China （MIIT） proclaimed the list of 2087 “eliminate backward production capacity” enterprises of 18 industries and demanded these enterprises to be closed before the end of September. The minister of MIIT， Li Yizhong pointed out： “only by speeding up to eliminate backward production capacity， can extensive mode of economic growth of high input， high pollution， high consumption and low output be changed， can industrial structure be optimized， can international competitive ability be enhanced， and can large industries to grow stronger. Those enterprises that don’t observe the regulations to eliminate backward production capacity will be withdrew the sewage discharge permission licenses， banks and financial institutions can’t provide them for any forms of additional credit granting support， investment management departments can’t examine and approve and the new investment projects， land resource management departments can’t approve additional land and related departments refuse to transact the production permit for them. Those enterprises with heavy tasks and fulfill them smoothly would be offered support funds for technological transformation， energy conservation and emission reduction， land development and utilization， financing support， and so on.
2.3 Structure Developing and Utilizing New and Renewable Energy Is the Key of Optimizing Energy Structure and Raising Energy Reserves
Development of new and renewable energies is the important means for energy conservation and emission reduction， environment protection and addressing climate change. In November 2009， Premier Wen Jiabao issued a speech of “Let the Science and Technology Lead China’s Sustainable Development”， Wen pointed out that the emerging strategic industries gradually should become the leading force in economic and social development. He stressed that the scientific selection of the emerging strategic industries is very important. China’s development of new strategic industries， have a certain degree of comparative advantage and broad space for development， can make a difference. China must attach great importance to the development of new energy industries， innovation and development of renewable energy technologies， energy conservation and emission reduction technologies， clean coal technology and nuclear technology. Premier Wen Jiabao’s speech provided a vital guide for China’s development of new energy and renewable energies.
Overall， China’s energy situation is “rich coal， poor oil and lack gas”. However， China’s renewable energy is very plentiful. Wind power is currently enjoying the fastest growth in all power generation technologies in China， almost doubling the installed capacity every year since 2004. As a result， it has grown from 0.76GW in 2004 to 13.24GW in 2008. Some believe that China is on track to beat the government’s current wind power target （30GW by 2020） by 200%. China now has the world’s fourth largest wind power capacity after US， Spain and Germany. It is believed that China could reach 100120GW by 2020 and up to 270GW in 2030 （Wang & Watson， 2010）.
Meanwhile， Hydropower resource to be exploited in China is at the top of the world， wind power， biomass power， hydrogen energy and ocean energy are in the leading position as well. However， except hydropower is relatively well developed and utilized， the proportion of renewable energy is only 2%， far below the average value 8% of the international advanced level. Therefore， China should improve energy structure and develop cleaner energy and renewable energy energetically， such as wind energy， solar energy， biomass power， geothermal energy， tidal energy and nuclear energy so as to realize resources to be achieved lastingly and supplied sustainably.
Note： GW is a unit of capacity in power generation， 1GW =1000MW
（Jiang， Sun & Li， 2010）
Figure 1
The Proportion of Renewable Energy in China’s Primary Consumption System
Sources： National Energy Administration （NEA）， 2012
Figure 2
Strategic Path and Systematic Framework of China’s New and Renewable Energy Development
Sources： Author’s own photograph
According to renewable energy mid and long-term development plan， China has targeted alternative energy sources to meet 15% of the nation’s energy requirements by 2020， up from 8.9% in 2008. This is a big step up from the previous goal of 10% by 2020. Under this ambitious government plan， China aims to have an installed capacity of 300 GW for Hydropower， 30 GW for wind power and 30 GW for biopower and to produce 10 million ton of ethanol and 2 million ton of biodiesel by 2020（Zhang， 2007b）. It can be seen from the Table 1 and Figure 1， renewable energy proportion will account for 15% of the nation’s primary energy consumption system by 2020， twice as much as that of 2005.
3. SAFEGUARD SYSTEM OF NEW ENERGY INDUSTRIES： LAWS， REGULATIONS AND INCENTIVE MECHANISMS
First， China has enacted a serious of related laws and regulations to lead and propel development of new energy industries， such as Energy Law， Mineral Resources Law， Coal Law， Electricity Law， Cleaner Production Promotion， Low-carbon Economy Law， Oil and Natural Gas Law， Civil Nuclear Energy Law and Energy Public Utility Law. Meanwhile， the supporting regulatory documents of Renewable Energy Law， Energy Conservation Law （have been revised） is going to be constituted soon.
From October 15th to 18th， 2010， the fifth plenum of the 17th CPC central committee was held in Beijing. The plenum adopted the “CPC Central Committee’s Proposal for Formulating the 12th Five-Year Program for China’s Economic and Social Development （2011-2015）”. The plenum underscored the importance of developing strategic emerging industries and constructing modern energy industry. Moreover， in October 2010， China enacted the “The decision on speeding up the development and cultivation of emerging strategic industries” and defined 7 industries， namely， energy saving and environmental protection， new energy， new energy vehicles， new generation of information technology， biology， high-end equipment manufacturing and new material. Most of them are related with new and renewable energies.
Second， China’s investment for new energy industries is increasing obviously in recent years. According to the research finding of Climate Change Research Institute of Australia， China has invested $35 billion for clean energy in 2009， far higher than America’s $18 billion. Other findings also indicated that China’s clean energy investment accounted for $13.5 billion in the global $38 billion， but America’s investment decreased to $4.4 billion in the third quarter of 2010.
Third， there are many incentive mechanisms to promote development of strategic emerging industries in China. In July 2009， China implemented “the Golden Sun” demonstration projects to promote the solar energy industry. Through this program， the government will subsidizes 50% of investment costs for more than 500 MW of solar power capacity by 2011.
For developing wind power， Chinese government has carried out lots of encouraging mechanisms， include value added tax being cut in half， low duty rate， and duty free for equipments imported for renewable energy technologies. These measures made a large number of domestic wind power enterprise rise in the world， such as Sinovel Wind， Goldwind Science and Technology and Dongfang Electric. Meanwhile， China has carried out “Wind Power Concession Program” and “Feed-in Tariffs for Wind Power” as its basic strategy to further propel wind power development.
Last， Chinese government can promote development of new energy industries by building of new energy industrial utilization and demonstration bases so as to summarize the rule， realize scientific deployment and provide support for low-carbon economy. At present， there are many windmill and solar PV product bases in Xinjiang， Inner Mongolia， Shandong， Hebei， Tianjin and Wuxi. At the same time， China had planned 13 large hydropower bases， including upriver of Changjiang River， Wujiang River， Nanpanjiang Hongshui River， downriver of Yellow River， Western of Hubei province， Fujian， Zhejiang and Jiangxi district， and northeast seven hydropower bases with deep exploitation （Jiang， Sun， & Li， 2010）.
Recently， Ministry of Finance， Ministry of science and technology， Ministry of Housing and Urban-Rural Development， and National Energy Administration promulgated the first 13 demonstration zones of centralized application on photovoltaic power generation， the list includes Beijing Yizhuang Economical Development Zone， Shanghai Zhangjiang High-tech Park， Sino-Singapore Tianjin Eco-city， Shenzhen High-tech Industrial Park， and so on. Chinese government will enhance the policies support strength to those application and demonstration projects of Golden Sun and Building Integrated Solar PV， the central finance will subsidize 50% of the agreement price to critical equipment.
CONCLUSION
In summary， at present， nothing is more important than to promote low-carbon economy in China. It is high time to construct system framework and provide ideas and countermeasures for creating low-carbon economy ways with Chinese characteristics. Taking into account all systemic factors， we may safely reach the conclusion that the energy development system in China for low-carbon economy is fundamental. It is high time that governments put considerable emphasis on it and implement it as soon as possible.