China’s reduced climate ambitions are risk management, not climate defeatism

China’s 15th Five-Year Plan covers the period 2026–30. Approved by the National People’s Congress on 12 March, it includes several climate-related targets that at first glance might seem like backsliding but in reality reflect sensible foresight, as Mathias Larsen explains. 

The new, 15th Five-Year Plan (FYP) features lowered targets for reducing carbon intensity, does not set an absolute cap on emissions and appears to have softened the approach to coal. While we should not be naive about China’s climate plans, less ambitious climate targets in the near term do not mean China has given up on a green transition.

Weaker targets for carbon intensity, total emissions and coal

The Plan sets a target of reducing China’s carbon intensity, the annual emissions of carbon dioxide per unit of annual gross domestic product, by 17% over the next five years. This is lower than the amount the Centre for Research on Energy and Clean Air calculates would be needed to reach a reduction in carbon intensity of 65% by 2030 from 2005 levels, as per China’s earlier commitment. The latter goal was pledged by President Xi Jinping in December 2020, stating that China would cut its carbon intensity “by over 65% from the 2005 level” by 2030. Five years previously in 2015, China had submitted its intended nationally determined contribution (NDC) to the Paris Agreement, including a target of cutting its carbon intensity by 60–65% by 2030 compared with 2005.

Over the period of the previous Five-Year Plan – the 14th FYP for 2021 to 2025 – the country achieved a 12.4% cut in carbon intensity, not meeting its FYP target of an 18% reduction by 2025 compared with 2020. This means that China would have needed to set a goal of reducing its carbon intensity by 23% for the 15th FYP to achieve the 65% cut by 2030.

Instead, China has set a 17% reduction target for the 2026 to 2030 period. This is based on a revised definition of carbon intensity that includes not only emissions from energy, as in the past (for example, in China’s 2023 report to United Nations Framework Convention on Climate Change), but now also non-energy industrial emissions, such as carbon dioxide released during cement production and use (as outlined, for example, in its 2026 emissions report). With a slump in real-estate construction over the past five years, emissions from cement have fallen, making it easier to meet the carbon intensity targets under this new definition.

Coupled with current GDP growth assumptions, the new definition means that the new target in the 15th FYP allows China’s carbon dioxide emissions to increase by 3 to 6% between 2026 and 2030, according to the Centre for Research on Energy and Clean Air.

In addition, the 15th FYP does not set an absolute cap on emissions, even though China’s State Council published a policy in 2024 indicating that both carbon intensity and total emissions would be controlled.

Finally, China has walked back on President Xi Jinping’s commitment from 2021 that the 15th FYP would reduce coal consumption. The new Plan instead promotes the peaking of coal use, which leaves space for its use in power and chemicals to plateau or even grow.

But before drawing conclusions about what these reduced targets mean, it is important to understand why they have taken this shape.

Hedging against fossil fuel market shocks

The targets do not signal that China is giving up on its green transition. They are, more accurately, a risk mitigation strategy against disruptions in global oil and gas markets, whether from price shocks or supply chain breakdowns. China has always been concerned about its dependence on fossil fuel imports, but the COVID-era supply chain shocks and price volatility triggered by the war in Ukraine made those concerns considerably more acute.

This exposure runs across the economy, and short-term disruptions to imports could lead to higher coal consumption in several ways. The number of electric vehicles on China’s roads is expanding rapidly, but the electricity powering them still depends on coal, and will continue to do so, particularly if the number grows faster than anticipated. The petrochemicals industry can use coal-based feedstocks if oil supplies tighten. In residential heating, any serious disruption to gas supplies could push millions of households back to coal almost overnight. And 20% of China’s fertilizer production involves natural gas, with the remainder using coal, which could be expanded.

Coal is China’s buffer against these vulnerabilities. The lower climate targets create the policy space to use that buffer if needed but in China’s strategic logic, coal remains a contingency rather than a destination.

Renewables, green fuel and a modernised grid remain paramount

The emphasis on green industries in the 15th Five-Year Plan shows that the country remains dedicated to decarbonisation. Alongside scaling up renewables, China is now implementing grid modernisation and developing green hydrogen, which could, over the coming decade, allow domestically-produced clean energy to replace fossil fuel imports across a wide range of industries. This is not the investment profile of a country that has given up on decarbonisation.

Preserving flexibility to use more coal in the near term is designed to absorb shocks that would otherwise destabilise the economy. Taking the supply risks around oil and gas seriously, even if that means more coal use in the short run, actually strengthens the case for green technology as the only durable long-term substitute for fossil fuel imports. If such a supply shock occurs, the near term may see slower decarbonisation as a result, but it can create conditions for faster progress beyond 2030. China’s coal-fired power plants only ran at half capacity in 2026. With a fossil fuel supply shock, that could increase in the short term. But without a supply shock, coal use will continue to decline as it moves to a supporting role in the power system.

The effective closure of the Strait of Hormuz as a result of conflict in the Middle East, has sent oil prices soaring and is precisely the kind of disruption for which China has been preparing. Roughly half of China’s oil imports pass through the Strait in tankers. Beijing’s caution now looks less like hedging and more like foresight.