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China’s Low-carbon DevelopmentChina’s Low-carbon Development

Xue Jinjun,

Professor at School of Economics, Nagoya University

Chairman of Academic Committee,

Institute of Global Low-carbon Economy 　 (http://iglce.org/)

UNFCCC Conference China Corner: Green Development in China

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Contents

I. China’s High Carbon EconomyII. A Theory for the Low-carbon

EconomicsIII.China Towards a Low-carbon

EconomyIV.Conclusion

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1, China’s High Carbon Economy (1) China’s High Growth

Table 1 An International Comparison of High Growth Periods

Countries and Regions Period Years Annual Growth Rate

Japan 1958-73 15 9.71973-88 15 3.61988-93 5 3.0

South Korea 1962-77 15 9.61977-87 10 8.01987-95 8 8.1

Taiwan 1962-77 15 10.11977-87 10 8.71987-95 8 6.6

China 1978-96 18 10.61981-90 10 9.4

1991-2000 10 10.12001-2005 5 9.51978-2008 30 9.0

Source: Economic planning agency of Japan, Asian economy 1996; China Statistics Yearbook 2008.

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$0

$1,000

$2,000

$3,000

$4,000

$5,000

$6,000

$7,000

$8,000

US$

PPP

Figure 2 GDP Per Capita

2, China’s High Carbon Economy (1) China’s High Growth

Source: IMF ， World Economic Outlook 2011. CIA, 2011. World Bank ， World Development Indicators 2011.

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1, China’s High Carbon Economy (2) Export-led growth

Figure 4 Trade Ratio in China [(Export + Import) / GDP]

Source: China Statistics Yearbook 2011.

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Source: World Bank, Data Base, China.

1, China’s High Carbon Economy (2) Export-led Growth Export and CO2 Emission in China

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1, China’s High Carbon Economy (3) China’s environment Kuznets Curve – SO2

Source: China Statistics Yearbook 2011.

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1, China’s High Carbon Economy (4) China’s Carbon Kuznets Curve – CO2

Source: IMF ， World Economic Outlook 2011. CIA, 2011. World Bank ， World Development Indicators 2011.

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Ⅰ. China’s High Carbon Economy (6) The world largest carbon emitter

中国, 21.9%

美国, 18.7%

前苏联地区, 8.1%印度,

4.8%

日本, 3.8%

德国, 2.7%

加拿大, 1.8%

世界其他地区, 38.2%

The Shares of China in the worldPopulation: Manufacturing Production

Source: IMF ， World Economic Outlook 2011. CIA, 2011. World Bank ， World Development Indicators 2011.

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2. A Theory for the Low-carbon Economy (3) Carbon and environment constrained EKC

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Carbon Emission

C (constraint of Environment Degradation)

Tunnel Effect

Take-off High growth Low growth EKC

Time

Y1 Y2 Y3

2. A Theory for the Low-carbon Economy (5) The Low-carbon catch-up theory and a new EKC

LCE with new Tech.

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3, China Toward a Low-carbon Economy (1) Background

Copenhagen Accord (COP15, Denmark 2009):

• United States sets its targets that would reduce GHG emissions to 17% below 2005 levels by 2020; 42% by 2030; and 83% by 2050.

• European Union promised to cut its GHG emissions by 30% below 1990 levels by 2020.

• New Japan government pledged to cut its GHG emissions by 25% below 1990 levels by 2020.

• Canada's target is to reduce GHG emissions by 20% below 2006 levels by 2020.

• China announced its intention to reduce the CO2 emissions

intensity within its economy by 40-45% by 2020.

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3. China’ Toward a Low-carbon Economy　　　　　　(2) Decreasing　of　CO2　Emission　Per　GDP

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3, China Toward a Low-carbon Economy (3) Energy Structure in China

Source: China’s Statistical Yearbook, 2011Source: China’s Statistical Yearbook, 2011

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Achievements gainedAchievements gained

Energy Intensity of GDP reduced by 19.06%

Energy Intensity of GDP reduced by 19.06%

Accumulated energy savings

exceed 0.6 billion tce

Accumulated CO2

emission reduction

amounts to 1.4 billion

tons

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3, China Toward a Low-carbon Economy (3) Energy Intensity in China

Source: Xue and Zhu (2011).Source: Xue and Zhu (2011).

GDP*(billion RMB Yuan)

Energy(Mtce)

Energy Intensity(Tce/10K RMB Yuan)

Energy-saving(Mtce)

2005 18.49 2360 1.276 　

2006 20.84 2587 1.241 72.3

2007 23.79 2805 1.179 148.1

2008 26.08 2914 1.117 160.8

2009 28.48 3066 1.077 116.6

2010 31.43 3250 1.034 133.1

The Accumulated Energy-saving during the period of 2006 and 2010 631

The Fixed Energy-saving of 2006 and 2010 760

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3, China Toward a Low-carbon Economy (4) Energy Saving Achievement in the period of the 11th 5-year Plan

Source: Xue and Zhu (2011).Source: Xue and Zhu (2011).

11th FYP Reality status

Annual growth rate of GDP (%) 7.5% 11.2%

GDP in 2005(trillion RMB Yuan) 18.49 18.49

Energy Intensity in 2005(tce/10k RMB Yuan)

1.276 1.276

Improvement Rate of Energy Intensity(%)

20 18.96

GDP in 2010 (based on 2005 constant price, trillion RMB Yuan)

26.55 31.43

Energy Intensity in 2010(tce/10k RMB Yuan)

1.021 1.034

Total fixed energy-savings (Mtce) 678 760

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3, China Toward a Low-carbon Economy (5) Factor Decomposition of Energy Saving Effect

Source: Xue and Zhu, 2011Source: Xue and Zhu, 2011

Energy-savings(Mtce)

Contribution Ratio(%)

Industrial Structure﹡ 117.88 18.5

Industrial Sector 371.78 58.3

Commercial & Residential Sector

120.53 18.9

Agriculture & Construction Sector

33.09 5.2

Transportation Sector -5.13 -0.8

Total 638.15 100

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3, China Toward a Low-carbon Economy (6) Contribution of key policies to carbon intensity improvement of GDP (2005-2009)

Source: Xue and Zhu, 2011Source: Xue and Zhu, 2011

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Conclusions on decomposition of energy intensity of GDP

• Energy saving due to structural effect mostly comes from structural

adjustment within the secondary sector and tertiary sector

– Structural adjustment among the primary sector, the secondary sector

and the tertiary sector only contribute about 7.9%

 Energy-savings

(Mtce)Contribution Rate

(%)

Industrial Structure 1,451 7.9

Internal Secondary Industrial Structure 4,896 26.6

Internal Tertiary Industrial Structure 5,441 29.6

Internal Industry Sector Structure 2,065 11.2

Internal Industry Subsector Structure 4,538 24.7

Total 18,392 100

Energy-saving and its Contributions from Structure Change for 11th FYP

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Conclusions on decomposition of energy intensity of GDP

• From the perspective of action based approach, most energy saving comes from the ten key energy saving projects.

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3, China Toward a Low-carbon Economy (7) Green-Low-Carbon Development in the 12th FYP

Source: The 12th FYP, 2011Source: The 12th FYP, 2011

Targets

The 11th FYP The 12th FYP

2005（ Real)

2010（ Planed

)）

Annual Growth （ %）

Attribute2010

（ Real）

2015（ Plan)

Annual Growth （

%）Attribute

GDP（万亿元）

18.5 26.1 7.5 Expectative 39.8 55.8 7% Expectative

Shares of non-fossil energy in

total energy (%)

- - - - 8 11.4 3.4 Constraint

Decrease of Energy

Intensity (%)

- - [20] Constraint - - [16] Constraint

CO2 reduction per

unite GDP （ %）

- - - - - - [17] Constraint

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3, China Toward a Low-carbon Economy (8) Non-fossil Energy Development Plan in the 12th FYP

Source: Xuan Xiaowei, 2011Source: Xuan Xiaowei, 2011

Year Share Changes of Non-fossil Energy in total energy consumption (%)

1990 5.1

2000 6.4

2005 6.8

2009 7.8

2015（ the 12th FYP） 11.4

2020 （ Planned Targets) 15

Average Annual Changes

1990~2009 0.14

2000~2005 （ 10th FYP） 0.08

2005~2009 （ 11th FYP） 0.25

2009 ～ 2015 （ 12th FYP） 0.60

2015 ～ 2020 （ 13th FYP） 0.72

2005 ～ 2020 0.55

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China became the second super economic power as well as the largest carbon emitter in the world.

China, as an emerging economy and responsible super power, should take bigger responsibility and act as a leader in carbon emission reduction.

China has been making the biggest contribution to the global worming world issue by actively dealing reducing energy intensity and carbon emissions.

The 12th FYP will lead China to a Green-low-carbon Economy.

4, Conclusion