Last month, China released its 14th Five-Year Plan (FYP). The FYP establishes broad-stroke economic targets for the country through 2025 and it comes on the heels of Xi Jinping’s September 2020 pledge to make China carbon neutral by 2060.
Despite that pledge, the FYP and recent development trends within the country show that it is doubling down on coal as its main primary energy source.
The FYP sets 20 “main indicators of economic and social development.” Four of the indicators pertain to energy and climate, two binding and two non-binding.
The binding targets are that China will reduce its energy consumption per unit of GDP by 13.5 percent and that it will reduce its carbon emissions per unit of GDP by 18 percent in the five-year period. Though these binding targets may sound stringent to the untrained ear, neither represents a meaningful change from present trends. As China’s economy has diversified and become more information-centered, its energy intensity and carbon intensity have naturally decreased. In fact, China’s carbon intensity fell by nearly 19 percent from 2015 to 2020, a more dramatic decline than the new FYP demands.
Importantly, by denoting its targets relative to GDP, China implicitly concedes that it will continue to increase its emissions in absolute terms. Analysis by Lauri Myllyvirta of the Centre for Research on Energy and Clean Air confirms this likelihood, indicating that China’s carbon emissions will continue to climb through the period of the FYP.
The non-binding indicators on energy and climate are that China has set a minimum annual threshold for general energy production and that it will increase its forest coverage by 0.7 percent. Forests serve as sinks and thus do reduce atmospheric concentrations of greenhouse gases.
Though it isn’t included in the table of indicators, the FYP also calls for a reduction in energy consumption from fossil fuels from 84 percent to around 80 percent by 2025. That said, it does not include a specific goal for shrinking the percentage that coal contributes to its total energy use. Coal currently provides more than 57 percent of China’s energy and 65 percent of its electricity.
According to data aggregated by David Sandalow of the Columbia Center on Global Energy Policy, China accounts for more than half the world’s coal consumption and generates one-fifth of the world’s total carbon emissions through its use of coal alone. Resultantly, China is responsible for well over one-quarter of the world’s annual emissions, despite its population being less than one-fifth of the world total.
China’s FYP will permit the continued expansion of coal power across much of China. A February 2021 paper from Global Energy Monitor reports that China has approximately 250 gigawatts of new coal-fired generating capacity permitted or under construction, adding to its existing 1,095 gigawatts of coal capacity.
Counterintuitively, China’s FYP and its continued coal development are consistent with the nationally determined contribution (NDC) China has committed as part of the Paris Agreement. China’s NDC pledges that it will reduce carbon intensity and reduce absolute-term emissions after 2030.
An NDC essentially sets out what a country is doing to combat climate change and China’s has two main components: a carbon intensity target (which, for the reasons given above, is extraneous) and a commitment to reach an emissions peak no later than 2030. To date, China has not officially submitted an enhanced NDC to the United Nations Framework Convention on Climate Change and the FYP proposes no update.
As I wrote for National Review:
The NDC and the new FYP give China the flexibility to continue using low-cost coal electricity to expand its economic output and, one could argue, give it an incentive to increase emissions in absolute terms all the way up to its NDC deadline of 2030. According to the Paris agreement watchdog group Climate Action Tracker, China could emit 30 percent more carbon dioxide in 2030 than it did in 2015 and still meet its Paris targets. The 14th FYP makes this scenario more probable.
This view is being expressed across ideological lines, including from Climate Action Tracker, whose China lead, Swithin Lui, said, “In terms of the climate, initial indications from China’s 14th Five Year Plan are underwhelming and shows little sign of a concerted switch away from a future coal lock-in.”