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Utilization of the non-fossil fuel target and its implications in China

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  • Shuwei Zhang
  • Nico Bauer

Abstract

China has pledged to meet a series of political targets on energy and environmental performance, including a target of a 15% non-fossil fuel share in total energy use by 2020. Achieving this target requires expansion of non-fossil energy and restraining energy use, which has implications for achieving the 40-45% carbon intensity reduction target. The present study outlines quantitative formulas to measure the nexus between the dynamics of GDP, energy, and carbon intensity. Considering a 'likely' scenario of the non-fossil fuel expansion envisioned by the Chinese government and a GDP growth rate of 8% per annum, the key to accomplishing both targets is to restrain energy consumption to attain an energy elasticity to GDP of approximately 0.53. Both targets can be achieved simultaneously with the existing non-fossil expansion plan and are within the 'normal' range of GDP growth seen in China over the long term. This is, however, less than the value realized over the last 10 years. To comply with the non-fossil fuel target, the potentially slower expansion of nuclear power capacity must be compensated for by other non-fossil options. Otherwise, there must be a greater attempt to decouple energy demand and economic growth in order to realize a smaller energy elasticity to GDP. Policy relevance China has pledged to achieve a 15% non-fossil fuel share and reduce its carbon intensity by 40-45% by 2020. The key to accomplishing both targets is to restrain energy consumption and promote the development of non-fossil fuels. The achievement of these two targets by 2020 is analysed between share of non-fossil fuel, CO 2 intensity of energy and GDP, and energy elasticity in relation to GDP. This analysis can inform the governmental energy and climate policy on the scale and pace of non-fossil fuel development, and the prerequisite regarding the energy elasticity to GDP to achieve the targets. The impacts of slower expansion of nuclear power capacity on the target achievement and implied elasticity of energy to GDP are also provided, which is close to the policy choice and actions of government on energy saving and emissions reduction.

Suggested Citation

  • Shuwei Zhang & Nico Bauer, 2013. "Utilization of the non-fossil fuel target and its implications in China," Climate Policy, Taylor & Francis Journals, vol. 13(3), pages 328-344, May.
  • Handle: RePEc:taf:tcpoxx:v:13:y:2013:i:3:p:328-344
    DOI: 10.1080/14693062.2013.768929
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    Citations

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    Cited by:

    1. Wenbin Lin & Alun Gu & Xin Wang & Bin Liu, 2016. "Aligning emissions trading and feed-in tariffs in China," Climate Policy, Taylor & Francis Journals, vol. 16(4), pages 434-455, May.
    2. Yuan, Yongna & Duan, Hongbo & Tsvetanov, Tsvetan G., 2020. "Synergizing China's energy and carbon mitigation goals: General equilibrium modeling and policy assessment," Energy Economics, Elsevier, vol. 89(C).
    3. Yang Liu & Taoyuan Wei, 2016. "Linking the emissions trading schemes of Europe and China - Combining climate and energy policy instruments," Mitigation and Adaptation Strategies for Global Change, Springer, vol. 21(2), pages 135-151, February.
    4. Yang Liu & Taoyuan Wei, 2016. "Linking the emissions trading schemes of Europe and China - Combining climate and energy policy instruments," Mitigation and Adaptation Strategies for Global Change, Springer, vol. 21(2), pages 135-151, February.
    5. Mittal, Shivika & Dai, Hancheng & Fujimori, Shinichiro & Masui, Toshihiko, 2016. "Bridging greenhouse gas emissions and renewable energy deployment target: Comparative assessment of China and India," Applied Energy, Elsevier, vol. 166(C), pages 301-313.

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