China Misses Energy Goal as Environment Concerns Grow

An analysis by Michael Lelyveld
china-smoke-coal-plant-hejin-shanxi-nov28-2019.jpg Smoke and steam rise from a coal processing plant in Hejin, central China's Shanxi province, Nov. 28, 2019.
Associated Press

As China tries to restore its economy to pre-pandemic levels, signs are growing that the government has assigned environmental concerns a lower priority.

One indication emerged last month from a report by China's top planning agency, showing that the government missed a key energy conservation target in 2019.

The report by the National Development and Reform Commission (NDRC) acknowledged that the government failed to reach its "obligatory" target of improving energy efficiency by 3 percent, achieving a reduction in "energy intensity" of only 2.6 percent.

The intensity indicator measures energy consumption per unit of gross domestic product, tracking China's progress in promoting efficiency and reducing energy waste year by year.

The energy intensity targets are also linked to carbon emissions commitments, climate change goals and smog.

The country has typically missed targets when the economy is under pressure or conservation takes a back seat to production growth.

In 2011, for example, energy use climbed 7 percent as GDP soared 9.3 percent. Efficiency improved only 2 percent, missing the target by 1.2 percentage points in that expansionary year.

In its report for 2019, the NDRC blamed the missed target on "the rapid growth of steel, building materials, nonferrous metals, chemicals, and the service sector," as the government struggled to boost sagging growth rates, even before the effects of the COVID-19 crisis were felt.

The agency argued that it had met 87.1 percent of the scheduled reductions in energy intensity for 2016-2019 under the 13th Five-Year Plan, "and thus was in line" with the efficiency goals. The plan calls for a 15-percent improvement in the five-year period through 2020.

But the government's policy this time appears to differ from its previous responses under the 12th Five-Year plan, when the NDRC raised its annual targets in an attempt to recover lost ground from the poor performance in 2011.

This time, the NDRC has not set a numerical target for 2020, casting doubt on the ability to meet the five-year goal.

"Much hard work will be required in order to achieve the target," the NDRC said without making a specific commitment.

Smoke rises above the skyline of Beijing on a moderately polluted day, Aug. 26, 2017.
Smoke rises above the skyline of Beijing on a moderately polluted day, Aug. 26, 2017.
Credit: Associated Press
Turning to ‘dirty’ industries

The NDRC report to China's annual legislative session was overshadowed by the government's decision to set no numerical target for GDP this year for the first time since the Asian currency crisis nearly two decades ago.

In his work report to the National People's Congress (NPC), Premier Li Keqiang cited uncertainty and unpredictability following a record 6.8-percent drop in first-quarter GDP due to the COVID-19 impact.

Without a GDP forecast, an energy intensity target may have become impossible, since the index is a ratio of energy consumption to GDP.

The NDRC said that another key target had been met last year, measuring carbon intensity, or the amount of carbon dioxide (CO2) produced per unit of GDP. China achieved a 4.1-percent reduction against a target of 3.6 percent, it said.

This week, the Ministry of Ecology and Environment also reported an improvement in air pollution in 337 monitored cities with good air quality recorded on an average of 82 percent of days last year.

But other reports cited concerns about China's greenhouse gas emissions this year as it strives to restore economic growth.

Reuters pointed to signs that "China is turning to 'dirty' industries and investment to kick-start its economy," raising carbon intensity.

"The magnitude of the coronavirus risks turning things upside down," said Li Shuo, senior adviser at the environmental group Greenpeace, according to Reuters.

Despite the reductions in intensity measures, China's total emissions will likely continue to rise with GDP growth as the economy rebounds with help from energy-consuming construction and infrastructure projects.

Recent reports by and other advocacy groups have criticized China's plans to build new coal-fired power plants at a time when the sector is already bloated with overcapacity.

Philip Andrews-Speed, a senior principal fellow at the National University of Singapore's Energy Studies Institute, said the pressures on China are similar to those affecting many countries.

"As in many countries today, the top priority is restoring economic growth and employment as much as possible. One way to do this is through construction and other energy intensive
industries," said Andrews-Speed.

"As a result, the environment, energy efficiency and climate change drop down the agenda, at least for a while," he said.

Passing references only

The environment received little attention in Premier Li's work report to the NPC.

Environmental safeguards were not included in the government's "six fronts" of stability, such as employment and investment, or the "six areas" of security, such as job and energy security, listed in a footnote to Li's speech.

The challenge of climate change was not addressed in the work report.

Li said the fight against pollution would continue as one of the country's "three critical battles," originally identified by President Xi Jinping, along with poverty and potential risk, according to another brief listing in a footnote.

"Priority will be placed on curbing pollution in a law-based, scientific and targeted way," Li promised without going into specifics. "We will intensify efforts to control air pollution in key areas," he said.

On Friday, the official Xinhua news agency published a series of Xi's "quotable quotes" on environmental protection on its website to mark World Environment Day, but it announced no new plans.

In an apparent attempt to defuse criticism of the downgrading, Huang Runqiu, the minister of ecology and environment, told Xinhua that the government would not relax environmental protections under the next five-year plan.

"In the 14th Five-Year Plan period, we will continue to improve ecological and environmental quality by reducing pollutant emissions, and vigorously promote ecological protection and restoration," said Huang.

Seven out of nine environmental targets under the 13th Five-Year Plan had been achieved, he said.

But Li's report left little doubt about the government's highest priorities for the recovery period, and the environment was not among them.

"This year, we must give priority to stabilizing employment and ensuring living standards, win the battle against poverty, and achieve the goal of building a moderately prosperous society in all respects," he said.

Andrews-Speed noted that environmental issues also received only passing references in a high-level Communist Party of China (CPC) document issued last month, laying out the party's agenda.

"We will improve the functions of the government in economic regulation, market supervision, social management, public services, and ecological environment protection, innovate and improve macro-control, and further improve the ability of macroeconomic government," the CPC said.

Climate change was not mentioned at all in the document released by CCTV News, entitled "Opinions of the CPC Central Committee and the State Council on Accelerating the Improvement of the Socialist Market Economic System in the New Era."


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