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Regulations / Treasury & Capital Markets
China reveals five-year green industrial plan
World’s largest manufacturer and GHG emitter sets 2025 targets to meet climate commitments
The Asset 6 Dec 2021

China’s industry ministry has released a plan focused on the green development of the industrial sector.

China is the world’s largest greenhouse gas (GHG) emitter both in terms of production and consumption and is the world’s largest manufacturing country. It has also committed to reaching its carbon emissions peak by 2030 and being carbon neutral by 2060.

However, the time left to meet its carbon peak in 2030 is quite limited as China is still in the process of industrialization and urbanization and lacks advanced green technology.

The Ministry of Industry and Information Technology's plan sets clear targets for 2025, by which time carbon-dioxide (CO2) emissions per unit are to be reduced by 18%; emission intensity of major pollutants, 10%; and energy consumption per unit hydrochlorofluorocarbons (HCFCs), 13.5%. As well, the ministry estimates recycled waste will increase to 480 million tonnes, water consumption per unit will be reduced by 16%, and the output value of the green industry will reach 11 trillion yuan (US$1.72 trillion).

More practical measures mentioned in the document are increasing the use of renewable energy (especially hydrogen energy), encouraging companies to replace coal with electricity and gas, and developing technology for the capture, reuse and storing of CO2. Besides CO2, other GHGs, such as nitrous oxide and HCFCs, are to be phased down.

The plan also emphasizes the role of government in building public service platforms for corporates with an infrastructure that includes consultation, testing, evaluation, identification, and audit and training services that will help corporates set feasible plans for decarbonization and the timely tracking of their efforts.

As well, the plan notes that the government needs to improve green policies and market mechanisms, and that apart from tax incentives, green financing and insurance can play an important part in the drive to carbon neutrality. The government has also said it is keen on operating a functioning trading market of carbon emission and energy consumption rights.

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