Has China’s green transformation begun?

What is China’s position at the upcoming Paris climate talks? What does that position mean for the country and for climate? Ask anyone following the UN-led climate negotiations and you will quickly realize these are some of the most keenly watched questions.

These negotiations have reached a critical moment before the Conference of the Parties (COP21) in Paris in December: the three largest greenhouse-gas emitting economies – not only China, the world’s largest carbon emitter by volume, but also the United States and the European Union – have now put on the table what they are willing to offer under a new global agreement.

What, then, has China put forward? On June 30, the country revealed its hand (known in UN-speak as an “Intended Nationally Determined Contribution”, or INDC). China will:

• cut its carbon emissions per unit of GDP by 60% to 65% by 2030, on a 2005 baseline;
• see a peak in its total emissions by 2030, with efforts to achieve this as early as possible;
• increase renewables in primary energy consumption to 20% by 2030, from 11.2% today; and,
• increase the volume of forest stock by around 4.5 billion cubic metres on the 2005 level.

China also set out a range of related pledges, including: to promote the low-carbon development of agriculture, “making efforts to achieve zero growth of fertilizer and pesticide utilization by 2020”; to promote “the share of green buildings in newly built buildings of cities and towns” to 50% by 2020; to establish a nationwide carbon emission trading system; and to establish a “Fund for South-South Cooperation on Climate Change”.

In sum, China made an ambitious commitment: increasing the share of renewables to 20% over the next 15 years, for example, entails adding some 800 to 1,000 GW of electricity generation capacity – equivalent to that added to the entire US power grid to date. But what about those secondary questions: how might this affect China? And what is the likely effect on the global climate?

For China, its INDC illuminates an enormous shift. Under what President Xi Jinping has called the “New Normal”, China has begun a transition from energy-intensive industries towards innovation and services as the basis of higher-quality growth.

Last year, China’s coal consumption fell by 2.9% on the previous year and continued to fall in the first quarter of 2015. This is more than the effect of a slowdown, say experts. It reflects instead a structural decline in the country’s coal industry, squeezed by environmental regulations and the rapid deployment of clean energy sources. China plans to install 200 GW of wind and 100 GW of solar by 2020 and it is now the world’s leading investor in renewables.