13th Five-Year Plan
The 13th Five Year Plan lays down the strategy and pathway for China’s development for 2016-2020 and includes concrete environmental and efficiency targets. It gives top priority to economic development to reach a GDP growth rate of 6.5-7% per annum, consistent with the goal of becoming a ‘moderately prosperous society’ by 2020, guided by five key principles of “innovative, coordinated, green, open, and shared development”. At the same time, the 13th Five Year Plan sets peak targets for carbon emissions and energy and water consumption, as well as goals for increasing efficiency of industries and eliminating outdated or overcapacity production facilities, increasing energy production from renewables, and developing green infrastructure. It follows the 11th Five Year Plan, which implemented the concept of energy intensity targets in a number of pilot projects, and the 12th Five Year Plan, which broadened the nature of economic growth towards social inclusiveness and sustainability.
China aims to reduce carbon dioxide emissions per unit of GDP by 18% from 2015 levels by 2020, in line with China’s pledge at the COP21 conference in Paris in December 2015, where President Xi Jinping affirmed China’s commitment to reduce total carbon emissions per unit of GDP by 60-65% from 2005 levels by 2030 and peak carbon emissions by 2030.
The 13th Five-Year Plan also tasks the government with developing rules and regulations to manage the national carbon trading program to be developed based on expansion of the existing seven pilot schemes and expected to be launched around 2018.
China aims to reduce energy consumption per unit of GDP by 15% from 2015 levels by 2020 (compared to the 16% set in 12th Five-Year Plan 2011-2015, which eventually delivered a reduction of about 18.2%). This more conservative goal is consistent with the estimated 6.5%-7% GDP growth rate projected for 2016-2021, which is slower than the 7% growth rate targeted in the 12th Five-Year Plan. To reach this target, the 13th Five Year Plan specifies sectoral targets and milestones. First, it sets a further goal to reduce energy consumption per unit of GDP by at least an additional 3.4% in 2016. Second, it caps China’s total energy consumption at 5 billion metric tons of standard coal equivalent by 2020, a 16.3% increase in consumption from 2015 levels.
To reach these goals, China’s energy production mix is set to diversify and shift away from coal and towards greater proportion of renewables. China is increasing the efficiency of coal burning power plants and also plans to shut down coal-fired boilers that fail to meet national standards, and has restricted construction of new coal-fired power plants. The Plan also supports increase in renewable energy capacity and connection through national government support for wind, solar, and biomass energy production. The Government will also continue to invest in new hydropower, energy storage and nuclear power projects, as well as further increase in the network of smart grids and ultra high-voltage power transmission.
The transportation measures and goals in the 13th Five Year Plan are closely related to addressing air pollution, in order to “maintain acceptable air quality levels in major cities for 80% of days by the end of 2020”. The Plan aims to expand the electric vehicle market, by constructing dedicated parking lots and charging facilities, and removing almost 4 million high-emission vehicles from roads. The Plan will continue to support adoption of low-emission “new energy vehicles” through subsidies to automakers, local governments for purchase of green fleets, and tax breaks and free registration for consumers.
REDD+ and LULUCF
The 13th Five Year Plan also aims to modernize commercial agriculture production to reduce overcapacity, while aiming to turn 1 million hectares of marginal cropland into forest or grassland. In an effort to reduce air pollution, the Plan also aims to increase forest coverage to 23.04% over the next five years.