After Copenhagen, China Strengthens Domestic Clean Energy Policies

Since the Copenhagen Conference the Chinese government has engaged in international debate on the meeting’s meaning, but the external tumult does not appear to have affected its efforts to move forward on policies to reduce carbon intensity.

China’s Renewable Energy (RE) Law is Updated: Connecting Power to the Grid

On December 26, China announced a critical amendment to its 2006 Renewable Energy Law, resolving three issues that have emerged in the original legislation (see “Chinese Law Aims to Increase the Use of Renewable Energy” and “China amends law to boost renewable energy law”.

The 2006 law focused on increasing installed capacity, placing requirements on power generators to increase the percentage of renewables in their power mix. The result has been a rapid increase in the amount of renewable generation, particularly wind power. In fact, China is about to overtake Spain to become the world’s third largest wind generator. The U.S. and Germany still lead, but China has been growing extraordinarily fast (see ChinaFAQs: Wind’s Rising Superpower).

This growth in installed capacity has come with concerns about the slow speed with which renewable energy sources are actually being connected to the grid, with reports in the past year that as much as 1/3 of total wind capacity was not yet connected. There have also been questions about whether grid companies were buying all the power from renewable facilities connected to the grid. Whether grid companies were deliberately practicing avoidance techniques (renewables other than hydropower are more expensive) was difficult to document. The number of plants was growing so fast that some lag in connecting to the grid seems unavoidable. Refusal to purchase was presented as a threat to grid stability, a real problem in some situations, but one that grid companies can work with power generating companies to mitigate.

The 2009 amendment to the Renewable Energy Law aims to address the challenge of connecting renewable capacity to the electric grid by placing the responsibility of increasing the share of renewables in the energy mix as firmly on grid companies as on generating companies. The State Council itself will set the requirements, and grid companies that fail to purchase the available renewable energy can be fined twice the amount the generator would lose. It also requires the grid companies to develop more transmission capacity from renewable-rich areas and to invest in smart grids.

Finally, the amendment provides for new financing programs, including a special fund for rural and remote projects and gives government energy authorities additional abilities to set in feed-in tariffs. Renewable energy already supplies 9% of China’s total energy needs, but mainly from traditional hydropower. Wind, solar and biomass have been growing rapidly in recent years, and by helping connect these newer forms of renewable energy to the grid, the new measures should help China reach its overall goal of 15% of total primary energy supplied by renewable sources by 2020.

Closing Inefficient Power Plants

At year’s end National Energy Administration chief Zhang Guobao also announced plans to close an additional 10 GW in small coal-fired power plants in 2010 . Closing small plants has been a central part of China’s energy intensity improvements under the 11th Five Year Plan (2006-2010). Zhang also reported that by the end of 2009 China had closed a total of 55.45 GW of small coal-fired plants, reaching the 11th Five Year Plan’s goal of 50 GW one year ahead of schedule.

Engaging in the post-Copenhagen Debate

The Chinese also continued to engage in the international debate surrounding the Copenhagen Accord. China was one of the main negotiators of the Accord, and came out originally with straightforward praise of the result. But as articles in both the U.S. and Europe suggested that China had not been a positive player, the Chinese government appeared to move more strongly to respond. There were some quite balanced comments, including an Op Ed by Frank Loy and Michael Levi in the New York Times and a comprehensive run-down by Fiona Harvey in the Financial Times, but there were two specific accusations voiced in the media – the first is that China was not a constructive player and the second that it specifically rejected a European proposal to state its 2050 goal in the final Accord text.

Reduction Equations

This second issue was raised by British Climate Minister Ed Miliband in a piece he wrote in the Guardian: “We did not get an agreement on 50% reductions in global emissions by 2050 or on 80% reductions by developed countries. Both were vetoed by China…” The Chinese have not responded directly to this issue, even though it would appear on the face of it to be fairly simple to respond to: the rejection of this language, whether it was by China or by the larger group of BASIC countries (China, India, Brazil and South Africa), is consistent with the long-term negotiating position of developing countries. The argument developing countries have made for a number of years is as follows: given that most of the world’s population today is in the developing world, and that proportion will be even higher in 2050 (even though China’s own population will peak as early as 2025 the U.S. Census Bureau now reports , this formula Minister Miliband refers to locks in long-term inequality in emissions if they are measured on a per capita basis. With this formula, the allowance per capita for developed country residents in 2050 would be at least double that of developing countries. The reason for the lock-in is that it is a two-part formula – it doesn’t just lock in the developed countries’ reduction, but with the global 50% reduction, locks-in the proportion of total emissions that would therefore be “left over” for developing countries. This is true both when the goals are worded this way and when they are worded as a 2 degree goal plus an 80% reduction for developed countries.

This arithmetic is also the substance of Mark Lynas’s concern in his accusatory article about China in the Guardian, in which he directly accuses China of “wrecking” the climate deal. He doesn’t explain his own views on emissions in that column, but in an e-mail to Andrew Revkin of the New York Times he rejects the notion of “carbon equity.”

Who’s Trying to Help?

But what the Chinese have focused on is the other part of Lynas’s piece and similar reporting in other media, including some apparent misrepresentation of Miliband’s own piece in other reporting, including in the Guardian itself imputing to China negative motives from the beginning. China presented its own version of the final days of negotiations’ chronology on its Ministry of Foreign Affairs website in a piece entitled “Verdant Mountains Cannot Stop Water Flowing; Eastward the River Keeps on Going”. The Xinhua-authored piece presents Premier Wen as an active player, who worked hard to get a deal together, meeting with multiple parties. The piece’s title is from a Song Dynasty poem, and its meaning is that certain results are inevitable. In this case, Xinhua seems to be suggesting that despite the levels of distrust and confusion (some of it described in the piece), a positive result was destined. The title has been interpreted in all sorts of ways in the Western press, including suggestions that the eastward flow refers to some kind of Chinese takeover. Anyone who knows Chinese geography knows that rivers flow from West to East simply because the Himalayas are in the West.

China came into the Copenhagen negotiations with little room to negotiate on its actual intensity target, which has been passed by a State Council decision, but that was actually true of most of the major players – the Europeans had announced their band well in advance, and countries like Japan, the U.S. and even a number of other developing countries had announced targets in advance with little indications of flexibility to move during the actual meetings. The Chinese and the U.S. negotiated the question of how to measure, report and verify (MRV) progress quite intensively, and one of the major results during the negotiations was compromise that the two countries, as well as the other BASIC countries, could agree to. The other major progress was actually new financing announcements from the U.S., Japan and several other countries. The Chinese, thus, saw themselves as making a major concession to advance a solution.

One interesting take on the negotiations is the piece by Director of the Brookings Institution’s John L. Thornton China Center and ChinaFAQs expert. Lieberthal describes the challenges China faces as it is now in a much more prominent place in these negotiations than it is accustomed to, and the internal tensions within the Chinese delegation as they tried to deal with the rapidly moving negotiation. These tensions appear to have now broken into the open with the news that Vice Minister of Foreign Affairs He Yafei has been reassigned to Geneva, an unusual lateral move for someone that high up in the bureaucracy. The Guardian piece reporting the news, based on a simple Xinhua announcement of the reassignment as part of a list of such government appointments and some Hong Kong press reports, probably goes beyond what is really known about the case in speculating on the specific issues about He’s performance.

So what comes next? Under the Copenhagen Accord, all signatories need to file their actual commitments by the end of January. While China is widely expected to commit to its 40-45% carbon intensity target, it has not actually said whether this is its plan. The Indian press is reporting that the four BASIC countries will continue to work together and will be meeting in the middle of the month before this reporting deadline to coordinate their approaches. One of the key outcomes of the Copenhagen meeting is clearly the emergence of BASIC as a negotiating group and as a group willing to engage directly with the U.S. Since Europe and Japan have already started to reduce their greenhouse gas emissions, it is the BASIC group plus the U.S. that face the more difficult policy choices, and thus need to develop common understanding and trust.

Photo by scot63us, courtesy of a Attribution-Share Alike 2.0 Generic License.