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Highlights of China’s Energy Transition and Carbon Reduction Efforts in 2018, Part 2

The year 2018 was a challenging one for the global energy transition and carbon reduction. Global carbon emissions were projected to rise more than 2 percent in 2018, mainly due to solid growth in coal consumption and sustained increases in oil and gas use. Even so, countries around the world, including China, are pushing to reduce carbon emissions and mitigate climate change. In 2018, China continued to release various policies to further deepen energy reform and promote national carbon emissions reductions. This blog highlights China’s 2018 efforts and progress to reduce carbon emissions from the building and industry sectors. Part 1 highlighted China’s efforts and progress in the renewable energy, power, and transportation sectors. 

Green Building Assessments and Near-Zero Energy Buildings

Green buildings are developing rapidly in China. As of June 2016, 4,314 projects—more than 500 million square meters—had been certified with Green Building Labels. China’s green building assessment is based on the Green Building Assessment Standard, which used to issue both design labels and operation labels. However, due to the difficulty of getting operation labels, less than 7 percent of buildings obtaining Green Building Labels had received operation labels by 2017 .

In September 2018, the Standard and Quota Department of China’s Ministry of Housing and Urban-Rural Development (MOHURD) issued for comments a revised edition of the national Green Building Assessment Standard. The Standard was approved in December and is expected to take effect in 2019. The revised edition restructured the Green Building Assessment Index System and extended the original metrics—which included land saving, energy saving, water saving, material saving, and environmental protection—to a series of more comprehensive metrics including safety and durability, service convenience, health and comfort, environmental livability, resource saving, management and innovation, and more. High-quality development has been established as the main target for green buildings for the first time. In addition, the new standard also simplified the dual Green Building Label—one for design and one for operation—to a single label for operation, allowing only buildings that have passed the assessment standards of actual operational data including energy consumption, level of comfort, etc., to obtain the Green Building Label. The new standard is performance-oriented and adds an analytical clause for carbon emissions of a building for the first time. It is predicted that the implementation of the new standard will help enable more stringent control of and further reduce carbon emissions in the buildings sector.

In February 2017, MOHURD issued the 13th Five-Year Plan for Building Energy Conservation and Green Building Development, which proposed to “actively carry out demonstrative construction of ultra-low energy buildings and near-zero energy buildings, and encourage the development of zero-energy building pilots. More than 10 million square meters of ultra-low and near-zero energy building demonstrative projects will be built by 2020.” In August 2018, MOHURD issued for comments the National Technical Standard for Near-Zero Energy Buildings—China’s first technical standard focusing on the concept of near-zero energy buildings. For the first time, it proposed the concepts and control indicators for near-zero energy buildings, as well as specific technical requirements in phases including planning, designing, construction, examination and acceptance, and operational maintenance of buildings, providing comprehensive technical standards and guidance for the life cycle of a net-zero energy building from design to operation. Preliminary estimates showed that completing more than 10 million square meters of near-zero energy building demonstration projects by 2020 would reduce CO2 emissions by 500,000 tons annually.

Developing Near-Zero Carbon Districts

In October 2015, China announced the implementation of near-zero carbon district demonstrative projects for the first time in its proposal on formulating the 13th Five-Year Plan for National Economic and Social Development. The following year, the Action Plan for Greenhouse Gas Emission Control in the 13th Five-Year Plan issued by the State Council explicitly stated that by 2020, 50 near-zero carbon district demonstration projects will be developed in selected restricted or prohibited development areas, ecological functional areas, industrial and mining areas, and cities and towns with mature conditions. Local governments responded positively and carried out demonstration projects in 2017 and 2018. Provinces and cities including Guangdong, Shaanxi, Hainan, Zhejiang, Jiangxi, Anhui, Yunnan, Beijing, Hefei, Ningbo, and Haikou are actively promoting near-zero carbon district developments, and many of these projects have put forward specific goals and implementation paths. Ningbo, a port city in Zhejiang Province, for example, is planning the Meishan Near-Zero Carbon Demonstrative Zone, a 330 square kilometer comprehensive development zone consisting of port, industry, and city. If the Meishan Near-Zero Carbon Demonstrative Zone can be completed by 2030, it will reduce carbon emissions by 900,000 tons compared with the business-as-usual scenario, while quadrupling the economy and tripling the population of the area, providing a great case study for other cities. 

Reducing Emissions in Industry

Industry is an important part of the national economy and also a major contributor to energy consumption and carbon emissions in China, accounting for almost 40 percent of China’s total carbon emissions. However, due to the complexity of industrial processes and the high cost of carbon reduction, the industrial sector has been widely regarded as a difficult area for carbon emissions reductions. Efficiency improvements, demand reduction, and deployment of decarbonization technology are the three main strategies for deep emissions reductions in the industrial sector.

Energy consumption per added value in China’s industrial sector fell by 4.6 percent in 2017. This number is expected to fall by 3.5 percent in 2018, and to continue to decline. This means that China has made progress in promoting energy efficiency in the industrial sector, but we must still actively explore more comprehensive solutions to achieve higher targets. In terms of demand reduction, total consumption of waste steel in China’s industrial sector in the first nine months of 2018 increased by 38.9 percent on a year-on-year basis, achieving the target proposed in the 13th Five-Year Plan for the Waste Steel Industry—that waste steel consumption should account for 20 percent of crude steel use as a raw material—more than two years ahead of schedule. In addition, the government issued four national standards to drive the significant reduction in demand of new raw materials, including the Series National Standards on Express Delivery Packaging and Technical Specification for Waste Plastics Recycling, and policies including Interim Measures on Assessment and Management of Comprehensive Utilization of Industrial Solid Waste Resources and National Products Catalogue of Comprehensive Utilization of Industrial Solid Waste Resources.

In terms of promoting deep carbon reduction technologies, China’s industrial sector has made some progress in the fields of electrification, biomass fuels, hydrogen energy, and carbon capture and storage. In 2018, the National Alliance of Hydrogen and Fuel Cell was established and the number of hydrogen energy industrial park pilot projects increased significantly across the country. Because it doesn’t face the barrier of distribution of hydrogen supply stations, the utilization of hydrogen in the industrial sector is more convenient than in other sectors such as transportation. Moreover, it can be used not only as a fuel directly in industries, but also as a reducing agent in the iron and steel industry, as well as in hydroprocessing, hydrocracking, and desulfurization in the chemical industry. Due to hydrogen’s abundant sources and ease of storage and transportation, hydrogen energy has obvious advantages in clean energy and will underlie a promising direction for promoting carbon emissions reductions in the industrial sector. With the further improvement of efficiency, the continuous reduction of energy demand, and the wide promotion of innovative low-carbon technologies, the industrial sector is expected to unlock more potential opportunities for carbon emissions reductions in the future.