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Emissions Intensity Targeting: From China's 12th Five Year Plan to its Copenhagen Commitment

Author

Listed:
  • Yingying Lu
  • Alison Stegman
  • Yiyong Cai

Abstract

China is currently the world’s largest single source of fossil fuel related CO2 emissions. In response to pressure from the international community, and in recognition of its role in global climate change mitigation, the Chinese government has announced a series of climate policy commitments, in both the Copenhagen Accord and its domestic 12th 5 Year Plan, to gradually reduce emissions intensity by 2020. Emissions intensity reduction commitments differ significantly from emission level reduction commitments that are commonly adopted by developed economies. In this paper, we investigate the economic implications of China’s recent commitments to reduce emissions intensity, and highlight the complexities involved in modelling intensity targets under uncertainty. Using G-Cubed, an intertemporal, computable general equilibrium model of the world economy, we show that China’s emissions intensity targets could be achieved with a range of low and high growth emissions level trajectories corresponding to low and high growth GDP scenarios, which lead to different welfare consequences.

Suggested Citation

  • Yingying Lu & Alison Stegman & Yiyong Cai, 2012. "Emissions Intensity Targeting: From China's 12th Five Year Plan to its Copenhagen Commitment," CAMA Working Papers 2012-45, Centre for Applied Macroeconomic Analysis, Crawford School of Public Policy, The Australian National University.
  • Handle: RePEc:een:camaaa:2012-45
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    File URL: https://cama.crawford.anu.edu.au/sites/default/files/publication/cama_crawford_anu_edu_au/2017-03/45_lu_stegman_cai_2012.pdf
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    References listed on IDEAS

    as
    1. Carraro, Carlo & Massetti, Emanuele, 2012. "Energy and climate change in China," Environment and Development Economics, Cambridge University Press, vol. 17(06), pages 689-713, December.
    2. Jotzo, Frank, 2010. "Comparing the Copenhagen emissions targets," Research Reports 107577, Australian National University, Environmental Economics Research Hub.
    3. Marschinski, Robert & Edenhofer, Ottmar, 2010. "Revisiting the case for intensity targets: Better incentives and less uncertainty for developing countries," Energy Policy, Elsevier, vol. 38(9), pages 5048-5058, September.
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    5. ZhongXiang Zhang, 2010. "Assessing China’s Energy Conservation and Carbon Intensity: How Will the Future Differ from the Past?," Working Papers 2010.92, Fondazione Eni Enrico Mattei.
    6. Yiyong Cai & Yingying Lu & David Newth & Alison Stegman, 2013. "Modelling Complex Emissions Intensity Targets with a Simple Simulation Algorithm," CAMA Working Papers 2013-33, Centre for Applied Macroeconomic Analysis, Crawford School of Public Policy, The Australian National University.
    7. Ma, Chunbo & Stern, David I., 2008. "China's changing energy intensity trend: A decomposition analysis," Energy Economics, Elsevier, vol. 30(3), pages 1037-1053, May.
    8. Lu, Yingying & Stegman, Alison & Cai, Yiyong, 2013. "Emissions intensity targeting: From China's 12th Five Year Plan to its Copenhagen commitment," Energy Policy, Elsevier, vol. 61(C), pages 1164-1177.
    9. ZhongXiang Zhang, 2011. "Assessing China’s carbon intensity pledge for 2020: stringency and credibility issues and their implications," Environmental Economics and Policy Studies, Springer;Society for Environmental Economics and Policy Studies - SEEPS, vol. 13(3), pages 219-235, September.
    10. Quirion, Philippe, 2005. "Does uncertainty justify intensity emission caps?," Resource and Energy Economics, Elsevier, vol. 27(4), pages 343-353, November.
    11. Zhongxiang Zhang, 2011. "In what format and under what timeframe would China take on climate commitments? A roadmap to 2050," International Environmental Agreements: Politics, Law and Economics, Springer, vol. 11(3), pages 245-259, September.
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    Citations

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    Cited by:

    1. Xuankai Deng & Yanhua Yu & Yanfang Liu, 2015. "Temporal and Spatial Variations in Provincial CO 2 Emissions in China from 2005 to 2015 and Assessment of a Reduction Plan," Energies, MDPI, Open Access Journal, vol. 8(5), pages 1-23, May.
    2. Cai, Yiyong & Newth, David & Finnigan, John & Gunasekera, Don, 2015. "A hybrid energy-economy model for global integrated assessment of climate change, carbon mitigation and energy transformation," Applied Energy, Elsevier, pages 381-395.
    3. Yingying Lu & David I. Stern, 2016. "Substitutability and the Cost of Climate Mitigation Policy," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 64(1), pages 81-107, May.
    4. repec:eee:appene:v:195:y:2017:i:c:p:837-849 is not listed on IDEAS
    5. Jun Dong & Yu Ma & Hongxing Sun, 2016. "From Pilot to the National Emissions Trading Scheme in China: International Practice and Domestic Experiences," Sustainability, MDPI, Open Access Journal, vol. 8(6), pages 1-17, May.
    6. repec:spr:endesu:v:19:y:2017:i:5:d:10.1007_s10668-016-9834-3 is not listed on IDEAS
    7. Yiyong Cai & Yingying Lu & David Newth & Alison Stegman, 2013. "Modelling Complex Emissions Intensity Targets with a Simple Simulation Algorithm," CAMA Working Papers 2013-33, Centre for Applied Macroeconomic Analysis, Crawford School of Public Policy, The Australian National University.
    8. Cai, Yiyong & Arora, Vipin, 2015. "Disaggregating electricity generation technologies in CGE models: A revised technology bundle approach with an application to the U.S. Clean Power Plan," Applied Energy, Elsevier, pages 543-555.
    9. Lu, Yingying & Stegman, Alison & Cai, Yiyong, 2013. "Emissions intensity targeting: From China's 12th Five Year Plan to its Copenhagen commitment," Energy Policy, Elsevier, vol. 61(C), pages 1164-1177.
    10. Zhu, Bangzhu & Wang, Kefan & Chevallier, Julien & Wang, Ping & Wei, Yi-Ming, 2015. "Can China achieve its carbon intensity target by 2020 while sustaining economic growth?," Ecological Economics, Elsevier, vol. 119(C), pages 209-216.
    11. repec:eee:eneeco:v:66:y:2017:i:c:p:17-26 is not listed on IDEAS

    More about this item

    Keywords

    China; Emissions intensity targeting; Climate policy; G-Cubed model;

    JEL classification:

    • C68 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Computable General Equilibrium Models
    • D58 - Microeconomics - - General Equilibrium and Disequilibrium - - - Computable and Other Applied General Equilibrium Models
    • E37 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Forecasting and Simulation: Models and Applications
    • Q43 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Energy and the Macroeconomy
    • Q54 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Climate; Natural Disasters and their Management; Global Warming
    • Q58 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environmental Economics: Government Policy

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