China released its thirteenth five-year plan on Saturday, pledging to cut the carbon intensity of its economy to 18% below current levels by 2020, a target that is likely to guide the CO2 cap in its national emissions trading scheme.
The plan also said energy use per unit of GDP would be reduced by 15% from 2015 levels between 2016 and 2020, and energy consumption would be capped at 5 billion tonnes of standard coal equivalent in 2020, compared to 4.3 billion tonnes last year.
China’s GDP will grow by an average 6.5% annually over the next five years, the plan stipulated.
“We will continue to push forward pilot and demonstration programs for low-carbon development, move faster to create a national market for carbon emission rights trading, and formulate a complete set-up of rules and regulations concerning such trading and its oversight,” the plan said.
China’s provinces and regions will be given individual carbon intensity targets that add up to the national 18% reduction goal.
Under the national ETS, which is slated to begin next year, emitters in eight sectors and 15 sub-industries will be given hard CO2 caps based on the provincial intensity targets.
A senior NDRC official said in December that the market’s CO2 caps would be even tougher than the overall national goal in order to ensure there is sufficient scarcity of allowances to generate liquidity.
The sectors that will be brought into the cap-and-trade programme are petrochemicals, chemicals, building materials, iron and steel, non-ferrous metals, paper production, electricity generation and aviation.
More than 10,000 companies nationwide accounting for 3-4 billion tonnes of annual CO2 emissions are to be regulated by China’s carbon market.
At the UN climate conference in Paris in December, China pledged to reduce its carbon intensity 60-65% below 2005 levels by 2030 and peak its GHG emissions by the end of next decade, although analysts believe Beijing will beat that target by at least five years.
By Stian Reklev – stian@carbon-pulse.com
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