Nation making constant efforts to achieve low-carbon development. Ouyang Shijia, Liu Zhihua and Hou Liqiang report.

China is ready to make a greater contribution to the global response to climate change. As such, the country is taking concrete steps to foster green, low-carbon, high-quality development as it embarks on a path toward carbon peak and neutrality, experts said.

According to the Government Work Report, delivered at the opening of this year's session of the 13th National People's Congress in Beijing on Saturday, the government has pledged to take well-ordered steps to achieve peak carbon dioxide emissions and carbon neutrality. They include making coal use cleaner and more efficient, while reducing the use of the fuel and replacing it with alternative energy sources in an orderly fashion.

The report said the country will work to upgrade coal-fired power plants to conserve resources, advance the planning and construction of large-scale wind and photovoltaic power bases, and promote the research, development and application of green and low-carbon technology. It will also encourage the steel, nonferrous metals, petrochemicals, chemicals and building materials industries to improve energy conservation and reduce carbon emissions.

Moreover, greater efforts will be made to stop the blind development of energy-intensive projects that feature high emissions and outdated production capacity.

He Lifeng, head of the National Development and Reform Commission, said China is fully confident of achieving the goal of peaking carbon dioxide emissions before 2030 and reaching carbon neutrality before 2060.

"That will create new development and business opportunities, such as spurring the development of emerging sectors and the upgrading and renovation of old equipment," he said, speaking on the sidelines of the ongoing two sessions.

He noted that pushing ahead with carbon peaking and neutrality work will effectively improve the living environment in both rural and urban regions, promote green development and contribute to the global response to climate change.

Kang Yanbing, deputy director of the National Energy Conservation Center, said the government's ongoing efforts to achieve carbon peak and carbon neutrality will boost the green economic recovery, despite possible downward pressure and uncertainties both at home and abroad.

"It is a strategic choice to promote the transformation and upgrading of the energy structure, which is key to building China into a modern socialist country and gaining a green, low-carbon competitive edge globally," Kang said.

Looking to the period of the 14th Five-Year Plan (2021-25), he said that to take the lead in peaking carbon emissions, the country must push hard to adjust its industrial structure, boost energy efficiency, improve the energy structure, strictly control the new production capacity of high-energy-consuming projects, vigorously develop green and low-carbon technologies and industries－such as renewable energy, new energy vehicles and clean heating－and support key regions and industries.

In recent years, China has made great progress in the reduction of carbon emissions. From 2015 to 2019, the nation's carbon intensity－the amount of carbon dioxide emissions produced per unit of GDP－fell by 18.2 percent, fulfilling the binding targets set in the 13th Five-Year Plan (2016-20) ahead of schedule, according to the Ministry of Ecology and Environment.

Citing such factors as China taking the top global spot in terms of the number of patents, investments and total power generated by renewable energies, Kang said clean energy and green and low-carbon technologies offer a zero-carbon and low-carbon technology path to achieve the nation's goal of peaking carbon dioxide emissions before 2030 and reaching carbon neutrality before 2060, as pledged by the top leadership, and they also provide support for the development of green industries.

While developed countries usually have a transition period of 50 to 70 years from the time carbon emissions peak to achieving carbon neutrality, China has the shortest time to become carbon neutral before 2060 from the peak of emissions before 2030.

Kang noted that China will need to make greater efforts than the developed world in this regard and warned of unprecedented challenges in the path to the carbon peak and neutrality goals.

He added that China's annual consumption of coal and oil is as high as 4 billion metric tons and 700 million tons, respectively. Under the carbon peak and neutrality goals, the country will face multiple challenges in terms of promoting decarbonization transformation and the upgrading of high-energy-consuming sectors such as coal mines, oilfields, electricity and steel, as well as relevant major infrastructure.

"At present, China's per capita GDP is far lower than that of developed economies in Europe and America, and we have seen ever-growing demand for services such as heating, air conditioning and automobiles," Kang said. "The development of new energies will help support economic growth and meet the rising demand."

In a forum last year, Liu Shangxi, head of the Chinese Academy of Fiscal Sciences, said the cost of the low-carbon transition would be high for a country with such a large economy, and the method of addressing it would be a decisive factor in how China reduces carbon emissions and pollution.

Control of carbon emissions and pollution requires policy, technology and accounting systems, the establishment of which will come at a cost, he said.

"Though it may lower costs in the future, technological development also requires investment and will raise current costs," Liu said.

He added that China is entering a high-cost era. In addition to the burden of an aging population and the cost of the low-carbon transition, the country could be confronted by costs that may emerge from uncertainties in the complex international environment and those generated as the world revamps its supply and industry chains.

He said one issue that should be fully considered is how to share these costs among the government, the market and different social sectors.

Overcoming challenges

Wang Jinnan, head of the Chinese Academy of Environmental Planning, said the country must act urgently to overcome burdensome tasks and difficult challenges in achieving its climate targets.

The nation's growing energy demand as it endeavors to realize socialist modernization by 2035 will put great pressure on its goal of peaking carbon dioxide emissions, said Wang, who is also an academician at the Chinese Academy of Engineering.

The European Union has about 70 years to go from carbon peak to neutrality, and it needs to reduce its carbon emissions by 60 million tons annually during this period, he said. However, China has to reduce its annual emissions by at least 300 million tons from 2030 to 2060.

Xie Zhenhua, the nation's special envoy for climate change affairs, said that as a developing nation, China's industrial structure remains dominated by heavy industry and its energy mix still relies on coal.

This means the country's low-carbon transition will not be easy, but many opportunities will emerge from this transition, he said.

In the energy system's low-carbon transition, more than 130 trillion yuan ($21 trillion) of investment－about 2 to 3 percent of annual GDP－will be leveraged if China takes proactive climate measures, he noted.

"The market potential is big," he said, adding that these low-carbon endeavors will not only promote high-quality economic development but also address environmental pollution at the roots.

He said these proactive efforts are expected to lower the average annual concentration of PM2.5－h(huán)armful particles with a diameter of 2.5 microns or less－to 15 micrograms per cubic meter, creating a much healthier environment.

According to the Ministry of Ecology and Environment, the average PM2.5 density in China was 33 mcg per cu m in 2020.

In October, the government rolled out top design guidelines to achieve the carbon peaking and neutrality goals, along with a detailed action plan for the 2030 target.

China aims to gradually increase the share of nonfossil energy consumption to about 20 percent by 2025, about 25 percent by 2030 and more than 80 percent by 2060, according to the document.

New growth points

Liu Qiao, dean of the Guanghua School of Management at Peking University, highlighted the importance of fostering green and low-carbon development, saying the investment in fields related to reaching the carbon peak will create new economic growth points, help boost total-factor productivity and maintain healthy and sustainable development.

"Sectors such as carbon neutrality, re-industrialization or the digitalization of the industrial sector, and new infrastructure will provide new growth momentum for the Chinese economy to maintain a stable uptick in growth, which is on the way to switching to a new development model underpinned by such new growth momentum," Liu said.

He added that to realize the goal of carbon neutrality, more industrial policies should be formulated to encourage technological and commercial model innovations in industries that are key to that aim－including construction, power and heat generation, metallurgy, chemicals, transportation, telecommunication devices, computers and other electronic equipment.

His views were echoed by Jin Yong, an academician at the Chinese Academy of Engineering, who said carbon neutrality will provide the biggest driving force for China's economic growth and transformation.

Speaking at a recent carbon neutrality meeting in Beijing, Jin said China should make a big push to optimize its industrial structure via a shift to the information era, gradually withdrawing from fossil fuels while giving full play to the leading role of renewable energies and promoting energy conservation and efficiency.

Yang Weimin, a member of the Standing Committee of the Chinese People's Political Consultative Conference National Committee, noted that China's industrial structure is characterized by a large number of high-energy-consuming industries.

"Five major (high-energy-consumption) sectors of petrochemicals, chemicals, steel, building materials and nonferrous metals contributed about 13 percent of China's GDP in 2018," said Yang, who is also vice-chairman of the Committee on Economic Affairs of the CPPCC National Committee.

As energy consumption has generated a large amount of carbon dioxide emissions during the process of economic development, he said China needs to gradually promote a development shift from energy-intensive and high-emission industries to low-carbon sectors, such as wind and photovoltaics.

Dedicated finance

According to Huang Yi, former executive vice-president of China Construction Bank Corp, under the carbon goals, China has been making major achievements in green financing innovations, and various kinds of green financial products including green loans, green bonds and green insurance have been springing up in the financial markets.

Green loans have become a strong supportive force for China's green upgrade of infrastructure, the shift toward clean energy, energy conservation and environmental protection, he said.

Huang made the remarks at a recent forum on carbon neutrality and green finance held by the Chongyang Institute for Financial Studies at Renmin University of China in Beijing.

He added that China has become an important player in global green finance, with significant advances in both the amount of financing and the growth rate, underpinned by the nation's efforts to achieve its carbon goals and to construct an ecological civilization. The nation's green financing products and services have also been going overseas, he said.

He said he expected the pursuit of the carbon goals to bring more than 1 trillion yuan of green financing funds to China each year for an extended period.

To meet the need for such a huge amount of investment, China should fully tap the potential of the green finance market while exploring innovative green finance development models, so such funds can be used more effectively.

Data from the People's Bank of China－the central bank－show that China's green finance saw robust expansion last year amid the nation's efforts to take a greener path to growth.

Green loans in yuan and other currencies reached 15.9 trillion yuan, year-on-year growth of 33 percent, far higher than the overall loan growth rate of 21.7 percent.

Green loans are a form of financing in which funds go to green projects, such as energy conservation and clean energy, that make contributions to environmental protection and improvements.

Specifically, loans for projects with direct or indirect carbon-reduction benefits accounted for 67 percent of the total green loans.

Hexagon Purus－a world-leading Norwegian provider of hydrogen Type 4 cylinders, battery packs and vehicle systems integration for fuel cell electric and battery electric vehicles－sees huge potential for hydrogen energy in transportation, industry and certain types of heating use in the Chinese market as a result of the country's carbon goals and solid action to address climate change.

China has been stepping up investment in hydrogen energy. The sector has been included in the current five-year plan as one of the "future industries".

Many provincial-level areas and cities have issued special policies to support the hydrogen energy industry.

Hexagon Purus said it will use its extensive experience of areas such as lightweight, reliable and safe hydrogen storage to contribute to the realization of China's carbon goals.

It added that it will continue to pay close attention to hydrogen development policies in various parts of China, and it expects to have more exchanges and cooperation with related domestic companies.