China’s peaking emissions and the future of global climate policy

China committed in the 2015 Paris Agreement—an international treaty which nearly 200 other countries also signed—to reach peak carbon emissions around 2030, and meanwhile to increase the non-fossil share of its primary energy to 20 percent. The Chinese government has supported the Paris Agreement and rigorously adhered to its Nationally Determined Contribution (NDC) by setting and strengthening the domestic policy targets for an earlier peak and faster reduction. Within weeks of the Paris Agreement taking effect in 2016, the Chinese government issued its National Strategy on Energy Production and Consumption Revolution (2016-2030), specifying its targets for energy consumption and non-fossil energy in 2030.

Encouragingly, China’s energy and environmental policies have already delivered many results. For instance, coal consumption has been capped to mitigate greenhouse gas emissions and to control air pollution. In tandem with slower but higher quality economic growth and an accelerated transition to clean energy, these policies led to a peak in coal consumption in 2013, at least seven years earlier than expected. Meanwhile, the energy intensity of the economy has decreased by more than 45 percent since 2005, meeting China’s Copenhagen target three years earlier than promised. China is also on track to meet its target for increasing the non-fossil fuel share of primary energy consumption. The credibility of the targets China continues to set is supported not only by this track record, but largely guaranteed by the system of policy implementation. When policy targets are set as “restrictive” by the central government, they are taken as binding at all levels of local governments and are consequently implemented by relevant administrative units and enterprises.

Studies modeling China’s energy-related carbon emissions have tended to estimate the year of peak emissions as falling between 2020 and 2030. In a new Brookings paper co-authored with Nicholas Stern, Jiankun He, Jiaqi Lu, David King, Tianle Liu, and Tong Wu—”China’s Peaking Emissions and the Future of Global Climate Policy“—we develop a new approach based on credible national policy targets for assessing the peaking time and pace of reduction of China’s carbon emissions. Our results show that China’s emissions entered a decade-long plateau in 2014, with minor fluctuations for the coming years, and could eventually enter a phase of steady decline as early as 2025. In other words, and in line with its track record of achievement in climate policy, China’s emissions are likely to have already effectively peaked.

China’s emissions are likely to have already effectively peaked.

Within the decade-long plateau, occasional fluctuations can be expected without undermining the essential conclusion about the long-term emissions trajectory. The plateau itself may be more meaningful than any specific year of peak. Economic deceleration and slower growth in power demand are the most important drivers of these encouraging trends. The economic “new normal”—in which the government has focused on the quality of economic structure instead of the simple quantity of economic output—together with a structural shift to sectors with lower energy intensity enables faster substitution of coal-fired power generation by non-carbon energy. Behind these changes is a major shift in the national development policy. China’s modernization target, advanced from 2050 to 2035, calls for fundamental improvements in environmental quality, necessitating an energy revolution to slow down the growth of energy consumption and to phase out fossil fuel use. The domestic policies seem to be working in synergy with the global climate targets.

These developments in China have critical policy implications for the rest of the world. China’s economic slowdown and restructuring are important factors, but the real game changers are the evolving energy technologies, markets, and consumer behaviors that break the inertia of the present energy structure, making deep decarbonization possible. Our findings confirm the conclusion of the U.N. Environment Programme Gap analysis that China is on track to not only deliver, but to exceed its NDC.

Considering the fact that some of the major developed economies may be falling behind in meeting their NDC pledges, China has become the clear leader in delivering on the Paris Agreement. That China, still an emerging economy with per-capita income significantly lower than the long-affluent Western economies, is undertaking and delivering on such ambitious climate goals demonstrates that development and environment do not form a zero-sum equation. Cutting carbon emissions and other forms of environmental impact need not trade off with social well-being and prosperity—increasingly, they are both compatible and necessary. The progress and prospects of China’s climate change mitigation could serve not only as a credible example to other developing countries struggling to balance the economy and the environment, but also to affluent countries that are wavering in their commitment to one of the most pressing challenges facing the world today.