China Sustainable Development Policy, CASIPM, WANG Yi

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1 2012 Berlin Conference on Evidence for Sustainable Development: Evidence for Sustainable Development Semi-Plenary I: The Science-Policy Interface Institutions and Boundary Organizations China s Policy of Sustainable Development: Practices and Challenges Prof. WANG Yi Institute of Policy and Management, CAS Freie Universität Berlin, Germany 5 th October, 2012

2 Contents t Progress of Sustainable Development in China Challenges Facing China China s 12 th Five-Year-Plan Proposals for Future

3 Government actions: Milestone to sustainable development 1992: Sign Rio Declaration in the UNCSD 1994: Release China s Agenda : Set sustainable development as a national strategy 1999: Launch key Ecological Restoration and Environmental Infrastructure programs 2003: Scientific Development Concept / balanced development 2006: Mandatory Target-Driven Strategy on energy efficiency and pollution reduction 2011: Transformation of economic development pattern, Green and Low-carbon development

4 Legislation Framework to Sustainability Water Law (2002) Environmental Impact Assessment Law (2002) Cleaner Production Promoting Law (2003) Renewable Energy Law (2006, amended in 2009) Industrial regulations, code, standard Energy Conservation Law (amended, 2007) Circular Economy Promotion Law (2008) Water Pollution Control Law (1984, amended 1996, 2008) Regulations on E-Waste Mgt (2009) NPC Resolution on addressing climate change (2009) Environmental Protection Law (1989, amended 2012) Energy Law (in progress) Climate Change Law (in progress)

5 Institutional arrangements and reform National ldevelopment and dreform Commission: i Energy Bureau Resource saving and environmental protection Dept. Climate change Dept. Regional development Dept. Ministry of Environmental Protection Ministry of Water Resource Ministry of Land Resource Ministry of Agriculture Ministry of Housing and Urban-Rural Development State Forrest Administration National Population and Family Planning Commission State Council Leading Group Office of Poverty Alleviation and Development

6 Policies and measures adopted on Energy Efficiency (EE) Target-based responsibility system Industry structural optimization and adjustment, decommissioning i i backward enterprises with low energy efficiency i and high emissions Implement of Tenkey EEPrograms Top 1000 enterprises energy conservation action plan (100 mtce reduction during ) Sectoral benchmark management Energy management contracting Promoting circular economy development Improvement of energy statistical system Establish a national energy conservation center Further EE publicity, education, and training

7 Actions to address climate change Mandatory targets t of energy efficiency i during , 2010 increase by 20% (more than 1.2 bn t CO 2 e reduction by plan, 1.5 reached) National Climate Change Assessment Report (1 st, 2006; 2 nd, 2011; 3 rd, 2014) National Climate Change Program (June 2007) China s S & T Actions on Climate Change (June 2007) White paper: pp China s Policies and Actions on Climate Change (Oct. 2008) Establish the National Leading Group on Climate Change, chaired by Premier WEN Jiabo (2008) Establish the Department of Climate Change under NDRC (2008) Carbon Intensity Reduction Commitment (Nov. 2009) New Energy Commission (super coordinating body, 2010)

8 Experience from policy review during Contributions to Sustainable Development Development ideas innovation Comprehensive plans, policies and instruments Practice, pilot and scale up Support other developing countries sustainability

9 Experience 1: development idea innovation 2002: New industrialization path 2003: Scientific development concept / balanced development: pay more attention to sustainable development 2004: Resource-Efficient and Environment-Friendly Society (REEFS) and Circular Economy (CE) 2005: Harmonious Society including man and nature relationship; Innovation-oriented i t country 2006: Energy efficiency and pollutants reduction 2007: Ecological civilization 2009: Green and Low carbon development 2011: Transformation of economic development pattern: green-leading in some extent

10 Experience 2: Comprehensive plan system and targets making National Five-Year Plan: Long-term strategy: realize the new development approach Comprehensive instrument (legislative, administrative, economic, tech) Growth pattern transition and structural adjustment Innovation orientation ti Mandatory targets approach: energy efficiency and pollutants reduction centered Legally binding domestically Sectoral plan: such as energy efficiency, renewable, pollution reduction, new energy vehicles, green industry Local FYP Action plan and comprehensive implementation program

11 Experience 2: comprehensive measures adopted Legislation framework Energy conservation law Renewable energy law Circular economy promotion law Energy law and Climate law in progress Reform of management system: establish climate management department mega ministry reform Governance improvement Administrative measures Target-based responsible system Green investment programs, etc. Economic instruments: green tax, ecological compensation, etc.

12 Pilot first Experience 3: Pilot and scale up: best practice and mass application Sustainable Development Demo Zone (MOST) Circular economy: province/city, it park, sector, enterprise (NDRC) Industrial base of new industrialization, REEF enterprise (MIIT) Ecological industry park (MEP) Energy and emissions inventory, low carbon development, and ETS pilot at urban and provincial levels (NDRC) Mass application Ecological restoration programs pollution control Energy efficiency Electric vehicles: BEV, Plug-in hybrid EV, Fuel Cell EV Renewables: hydro, wind power, solar PV, and others

13 Experience 4: Support to other developing countries Poverty reduction Health and medical support Infrastructure construction Capacity building: training Low carbon product aid: memo sighed with African and small island countries Strengthening S-S Cooperation Regulations setting: Guidance of Overseas Sustainable Forest Management, Green Loan Guidance; more will be coming

14 Comprehensive outcomes achieved Plan targets achieved Awareness increase Capacity building, such as energy statistics, institutional arrangements, and management Policy package Tech innovation o and green industry development Learning by doing (evidence or not?)

15 Contents t Progress of Sustainable Development in China Challenges Facing China China s 12 th Five-Year-Plan Proposals for Future

16 Key Elements for Sustainability Policy Making Changing trends/law of the environment and development National conditions: population, natural endowment, stage of development, etc. (advantages and disadvantages) Globalization and international responsibility Existing experience and future challenges No good model ahead but best practices

17 Trends of Three carbon emissions Peaks and measures responded Technology innovation Energy crisis; Cap control; Structural adjustment Development model transition; Fair regulation; New technologies, such as CCS; Population zero growth 碳排放放强度 on sity Carbo intens S 1 人均碳排放量 Per capita Emission s S 2 年份 Year otal mission 碳排放总量 To em s S 3 S 4 年份 Year T 1 T 2 T 3 年份 Year

18 Trends of China Population 中国人口 情 景 1 情 景 2 情景 情 景 4 情 景 5 情 景 6 CS: 基 准 线 CS: 替 代 方 案 10 亿人 C S : 低替代方案 ERI-CEED LES ERI:CESS-Low ERI:CESS-Medium ERI:CESS-High CCE1997:BaU 0.5 CCE2000:ED AIM/China SGM-China AIM/SRES-C AIM/SRES-D AIM/SRES-S AIM/SRES-E 年 份 TIMER-A1 TIMER-A2 TIMER-B1 TIMER-B2 Population peak at 1.5 bn or less around 2030 (1.34 bn in 2010) Shortage of labor supply after 2015, increase of labor cost Aging of population: over 20% in 2040 Population in poverty (128 Mn by $1/day in 2011)

19 Energy consumption increase vs Security 3.48 Bn tce in Mn tce/yr & about annually 9% increase during

20 Coal consumption: increase annually by 150 Mtce ( ) 2011) 2.39 Bn tce in 2011, 69% of total energy consumption

21 Power installed capacity growth rapidly 100 GW annually

22 China s wind power: high annual growth rate and potential over-capacity Renewable Energy Law and Supportive Policy and Regulations 29.6 GW in 2010 (grid-connected), annual growth rate at 94.75% in ; No.1 installed capacity in the world 200 GW or more in 2020 (target: 30 GW by plan in 2007) 80 companies for system production, localization rate of 1.5MW at 70% (MW) 装机 累计装机 Accumulated (MW) (MW) 新增装机 Newly (MW) (MW) 增长率 Growth rate % % 0% 年 140% 120% 100% 80% 60% 增长率

23 Serious Resources and Environmental Challenges Strategic resource and material shortages Water issues: shortage (in north and north-west regions), pollution, flood and drought, aquatic ecology, and management Solid wastes increase: industrial, civilian, e-waste Trans-jurisdiction river basin environmental problems Regional air pollution in some metropolitan areas Mixed pollutions: o conventional o pollutants, ts, POPs, etc. Regional problems caused by climate change

24 Mid-stage of industrialization, rapid urbanization Ratio of heavy industry: about 70% in 2010 World manufacture center : about 20-30% of embodied carbon export trade dispute increasing Urbanization: 50% in 2010, 1% annual growth rate Quality of life improvement and middle income trap Regional disparity 100% 90% 80% 70% 60% 50% 40% 30% 20% 百万吨标煤 一次能源需求量, 基准情景 生物柴油醇类汽油生物质能电风电核电水电天然气油煤 10% 0% 年份

25 Projected Chinese Carbon emissions by scenarios: opportunities & conditions/risks CO2 Emission from Energy Activities in China, IPAC Results Mt-C Year Baseline LCS Low Energy Policy Global 50% Proposal

26 Contents t Progress of Sustainable Development in China Challenges Facing China China s 12 th Five-Year-Plan Proposals for Future

27 Framework of the 12 th FYP The 12 th FYP outline: released Key and Special plans: 18 Green-related: emerging strategic industry; industrial transformation and upgrading; industrial distribution and adjustment; modern service industry; renewable development; energy conservation and pollution reduction; comprehensive transport; water conservancy; capacity building for innovation ; urbanization, information, etc. Sector-based plans:78 Local FYPs

28 Key messages from the 12 th FYP Theme: scientific development / balanced development Main thread: accelerating transformation of the economic development pattern Key yp points: Combination of development and transformation Integration of green and low-carbon concept into economic development Green Development: Building the Resource-Efficient and Environment- Friendly Society Strengthening mandatory target-driven en approach and march policy

29 Green targets increase during Green targets: 7 types with 12 targets (11 mandatory targets) Mandatory targets: Energy intensity, 16% Carbon intensity, 17% Share of non-fossil energy, reach at 11.4% (8.3% in 2010) Pollutant reduction: COD: 8% SO 2 : 8% NH 3 -N: 10% NOx: 10% PM 2.5 :?, new target for long-term, build monitoring system first, but not in the FYP

30 Green targets of the 12th FYP Mandatory targets (cont d): Arable land: keep the area fixed at 1.2 Bn ha. Forrest increase: forest cover: reached at 21.66% (20.36% in 2010) timber stock volume: 600 Mn M 3 Water use per unit industrial value-added : 30 % Predicted targets: Agricultural irrigation coefficient: reach 0.53 (0.5 in 2010) Other targets considered: resources productivity: 15%

31 Green targets t of the 12 th FYP Renewables: Hydro power: 290 GW Wind: 100 GW (grid-connected; 5 GW off shore) Solar: 21 GW Biomass: 50 Mtce Solar heat: accumulated at 400 Mm 2 New energy vehicle: 500,000 accumulated sale in 2015 (pure electric and plug- in hybrid, ambitious) Fuel economy: 6.9 l/100km for passenger vehicle

32 Incremental policies during the 12th FYP Transformation of economic development pattern and Regulating economic growth rate at 7% Develop the emerging strategic industries, 7 at national level, 3 related to green sectors: GDP share: around 8% in 2015, 15% in 2020 energy conservation and environmental industry (including circular economy) renewable energy energy-saving and new energy vehicles (battery, plug-in hybrid, fuel cell) Provincial emerging strategic industries Two regulations: low-carbon product standard, labeling and certification system; carbon emissions statistical and accounting system

33 Incremental policies during the 12th FYP Control of total energy consumption rationally (Beijing and Tianjin demo for total coal consumption control) Establish carbon trade market gradually Plan of major function-oriented zoning (optimized, prioritized, limited, and banned development) elopment) with regional policy Incentive policies Financial transfer and special programs locally resources tax reform eco-compensation regulation? environmental tax, carbon tax? (with taxation neutral) Total investment estimated: over 2000 Bn RMB yuan for green

34 Green targets in 2020 Mandatory targets: Carbon intensity, 40-45% ( ) ) Share of non-fossil energy, 15% (target in 2015: 11.4%) Forest area: 40 Mn ha. increase ( ) Timber stock volume: 1.3 Bn m 3 increase ( ) Pollutant reduction: no target to date

35 Implementation of the 12th FYP A comprehensive implementation program, released in August 2011 (12 aspects and target allocation by provinces) Investment on R&D&D: more than that in 11 th FYP period (over 10 Bn yuan by national S&T plans during ) Establishment of industrial innovation alliance, such as EV, CCS Setting sectoral roadmap and prioritized products and technologies International Science and Technology Cooperation Program on New and Renewable Energy (by MOST & NDRC in 2007)

36 Energy Intensity Target Allocation by province Provinces Energy Intensity Type 1 Shanghai, Tianjin, Jiangsu, Zhejiang, Guangdong 18% Tape 2 Beijing, Hebei, Liaoning, Shandong 17% Type 3 Type 4 Shanxi, Jilin, Heilongjiang, Anhui, Fujian, Henan, Hubei, Hunan, Chongqing, Sichuan, Shaanxi Inner Mongolia, Guangxi, Guizhou, Yunnan, Gansu, Ningxia 16% 15% Type 5 Hainan, Xizang, Qinghai, i Xinjiang 10%

37 Low Carbon Pilots Urban and provincial pilot on low-carbon: 5 provinces and 8 cities Leadership mechanism Low-carbon planning and policy system (key) Emissions i inventory and ddata collection Low-carbon models of industry, consumption, community, and business based on local conditions Carbon market pilot: 7 cites and provinces Emissions right and voluntary trading Carbon price formation mechanism Sectoral and trans-jurisdictional trading Phased implementation

38 LC pilots distribution 27% of population, 36% of GDP, 32% of energy consumption, and 27% of CO 2 emissions 低碳试点分布 辽宁北京 / 天津天津保定 陕西 重庆重庆 湖北湖北 / 武汉 南昌 上海 杭州 LC 云南 贵阳 广东 广东 / 广州 厦门 ETS 深圳 深圳

39 Potential challenges, uncertainty and difficulty during the 12th FYP Keeping high economic growth vs structural adjustment/development model transition Demand increase and domestic consumption stimulation due to rapid industrialization, urbanization, improvement of quality of life, and dealing with export decrease Soli issue: Sector-based plan and policy conflict Prioritizing: balance among different environmental and development targets Management with changes, dynamic planning, risk management

40 Potential challenges, uncertainty and difficulty during the 12th FYP (cont d) Systematic gaps: goals, tech, fund, roadmap, capacity building like statistics, management, etc. Command and Control measures dominated but high costs, economic incentives needed Development of green emerging strategic industries over-capacity of production technology roadmap, system integration, ti march policy package, business model, human resource, and green or lead market capacity building SME s involvement for eco-innovation Trade dispute: wind, solar PV, etc.

41 Contents t Progress of Sustainable Development in China Challenges Facing China China s 12 th Five-Year-Plan Proposals for Future

42 Future s actions and suggestions Governmental restructuring in 2013: mega department; coordination mechanism; consultation process Leadership, top-down with bottom-up: private public partnership (PPP) plan reviewing Integrated urban planning: tech, company, and implementation clusters Co-benefits / co-control control approach for R&D&D and diffusion Legally binding targets with comprehensive instruments target optimizing and regulation

43 Future s actions and suggestions (cont d) Systems innovation is a key to green transition: integration of targets, tech, roadmap, financial support, institutional and policy arrangements, capacity building, business model, green market development, etc. Policy review combination of learning by doing and evidence-based policy making introduce economic incentives Establishing the third part evaluation: Pre, process and post evaluation Improvement of evaluation indicators, monitoring, i modeling and tools; Strengthening cooperation at all levels with different platforms for sustainable development: best practice, research, development aid, CSR; multilateral, south-south, G20, BRICS, etc.

44 Set up technology innovation roadmap to 2050 Source: Energy Science & Technology in China: a roadmap to 2050,Science Press/ Springer,

45 CAS efforts on China Sustainable Development CAS involved in drafting of Our Common Future in 1980s and China s Agenda 21 More than 40 CAS institutes research on sustainability-related programs, cover basic science, applied research and tech development, demo, and policy analysis Publish the annual China Sustainable Development Report (CSDR) since 1999 Develop a Sustainability Evaluation Indicator System

46 CSDR em

47 CSDR Themes in recent years 2006, Building Resource-Efficient and Environment- Friendly Society 2007, Water: Governance and Innovation 2008, Policy review and outlook 2009, China s approach towards a low carbon future 2010, Green development and innovation 2011, Greening economic transformation 2012, China s SD in the Shifting Global Context Consensus and Cooperation for a Clean Revolution: China and global sustainable development, coop with The Climate Group released on 18 th June 2012 in Rio 2013, Green leadership and system innovation

48 Thanks for your attention! Berlin Conference on Evidence for Sustainable Development: Evidence for Sustainable Development Berlin, 5-6 October 2012