China’s central and local governments, as well as state-owned enterprises, are busy preparing for the next five-year planning period, spanning 2026-30.
The top-level 15th five-year plan, due to be published in March 2026, will shape greenhouse gas emissions in China – and globally – for the rest of this decade and beyond.
The targets set under the plan will determine whether China is able to get back on track for its 2030 climate commitments, which were made personally by President Xi Jinping in 2021.
This would require energy sector carbon dioxide (CO2) emissions to fall by 2-6% by 2030, much more than implied by the 2035 target of a 7-10% cut from “peak levels”.
The next five-year plan will set the timing and the level of this emissions peak, as well as whether emissions will be allowed to rebound in the short term.
The plan will also affect the pace of clean-energy growth, which has repeatedly beaten previous targets and has become a key driver of the nation’s economy.
Some 250-350 gigawatts (GW) of new wind and solar would be needed each year to meet China’s 2030 commitments, far above the 200GW being targeted.
Finally, the plans will shape China’s transition away from fossil fuels, with key sectors now openly discussing peak years for coal and oil demand, but with 330GW of new coal capacity in the works and more than 500 new chemical industry projects due in the next five years.
These issues come together in five key questions for climate and energy that Chinese policymakers will need to answer in the final five-year plan documents next year.
Five-year plans and their role in China
1. Will the plan put China back on track for its 2030 Paris pledge?
2. Will the plan upgrade clean-energy targets or pave the way to exceed them?
3. Will the plan set an absolute cap on coal consumption?
4. Will ‘dual control’ of carbon prevent an emission rebound?
5. Will it limit coal-power and chemical-industry growth?
Five-year plans and their role in China
Five-year plans are an essential part of China’s policymaking, guiding decision-making at government bodies, enterprises and banks. The upcoming 15th five-year plan will cover the years 2026-30, set targets for 2030 and use 2025 as its base year.
The top-level five-year plan will be published in March 2026 and is known as the five-year plan on economic and social development. This overarching document will be followed by dozens of sectoral plans, as well as province- and company-level plans.
The sectoral plans are usually published in the second year of the five-year period, meaning they would be expected in 2027.
There will be five-year plans for the energy sector, the electricity sector, for renewable energy, nuclear, coal and many other sub-sectors, as well as plans for major industrial sectors such as steel, construction materials and chemicals.
It is likely that there will also be a plan for carbon emissions or carbon peaking and a five-year plan for the environment.
During the previous five-year period, the plans of provinces and state-owned enterprises for very large-scale solar and wind projects were particularly important, far exceeding the central government’s targets.
The five-year plans create incentives for provincial governments and ministries by setting quantified targets that they are responsible for meeting. These targets influence the performance evaluations of governors, CEOs and party secretaries.
The plans also designate favoured sectors and projects, directing bank lending, easing permitting and providing an implicit government guarantee for the project developers.
Each plan lists numerous things that should be “promoted”, banned or controlled, leaving the precise implementation to different state organs and state-owned enterprises.
Five-year plans can introduce and coordinate national mega-projects, such as the gigantic clean-energy “bases” and associated electricity transmission infrastructure, which were outlined in the previous five-year plan in 2021.
The plans also function as a policy roadmap, assigning the tasks to develop new policies and providing stakeholders with visibility to expected policy developments.
1. Will the plan put China back on track for its 2030 Paris pledge?
Reducing carbon intensity – the energy-sector carbon dioxide (CO2) emissions per unit of GDP – has been the cornerstone of China’s climate commitments since the 2020 target announced at the 2009 Copenhagen climate conference.
Consequently, the last three five-year plans have included a carbon-intensity target. The next 15th one is highly likely to set a carbon-intensity target too, given that this is the centerpiece of China’s 2030 climate targets.
Moreover, it was president Xi himself who pledged in 2021 that China would reduce its carbon intensity to 65% below 2005 levels by 2030. This was later formalised in China’s 2030 “nationally determined contribution” (NDC) under the Paris Agreement.
Xi also pledged that China would gradually reduce coal consumption during the five-year period up to 2030. However, China is significantly off track to these targets.
China’s CO2 emissions grew more quickly in the early 2020s than they had been before the Coronavirus pandemic, as shown in the figure below. This stems from a surge in energy consumption during and after the “zero-Covid” period, together with a rapid expansion of coal-fired power and the fossil-fuel based chemical industry. as shown in the figure below.
As a result, meeting the 2030 intensity target would require a reduction in CO2 emissions from current levels, with the level of the drop depending on the rate of economic growth.
Xi’s personal imprimatur would make missing these 2030 targets awkward for China, particularly given the country’s carefully cultivated reputation for delivery. On the other hand, meeting them would require much stronger action than initially anticipated.
Recent policy documents and statements, in particular the recommendations of the Central Committee of the Communist Party for the next five-year plan, and the government’s work report for 2025, have put the emphasis on China’s target to peak emissions before 2030 and the new 2035 emission target, which would still allow emissions to increase over the next five-year period. The earlier 2030 commitments risk being buried as inconvenient.
Still, the State Council’s plan for controlling carbon emissions, published in 2024, says that carbon intensity will be a “binding indicator” for the next five-year period, meaning that a target will be included in the top-level plan published in March 2026.
China is only set to achieve a reduction of about 12% in carbon intensity from 2020 to 2025 – a marked slowdown relative to previous periods, as shown in the figure below.
(This is based on reductions reported annually by the National Bureau of Statistics until 2024 and a projected small increase in energy-sector CO2 emissions in 2025. Total CO2 emissions could still fall this year, when the fall in process emissions from cement production is factored in.)
A 12% fall would be far less than the 18% reduction targeted under the 14th five-year plan, as well as falling short of what would be needed to stay on track to the 2030 target.
To make up the shortfall and meet the 2030 intensity target, China would need to set a goal of around 23% in the next five-year plan. As such, this target will be a key test of China’s determination to honour its climate commitments.
A carbon-intensity target of 23% is likely to receive pushback from some policymakers, as it is much higher than achieved in previous periods. No government or thinktank documents have yet been published with estimates of what the 2030 intensity target would need to be.
In practice, meeting the 2030 carbon intensity target would require reducing CO2 emissions by 2-6% in absolute terms from 2025, assuming a GDP growth rate of 4.2-5.0%.
China needs 4.2% GDP growth over the next decade to achieve Xi’s target of doubling the country’s GDP per capita from 2020 to 2035, a key part of his vision of achieving “socialist modernisation” by 2035, with the target for the next five years likely to be set higher.
Recent high-level policy documents have avoided even mentioning the 2030 intensity target. It is omitted in recommendations of the Central Committee of the Communist Party for the next five-year plan, the foundation on which the plan will be formulated.
Instead, the recommendations emphasised “achieving the carbon peak as scheduled” and “promoting the peaking of coal and oil consumption”, which are less demanding.
The environment ministry, in contrast, continues to pledge efforts to meet the carbon intensity target. However, they are not the ones writing the top-level five-year plan.
The failure to meet the 2025 intensity target has been scarcely mentioned in top-level policy discussions. There was no discernible effort to close the gap to the target, even after the midway review of the five-year plan recognised the shortfall.
The State Council published an action plan to get back on track, including a target for reducing carbon intensity in 2024 – albeit one not sufficient to close the shortfall. Yet this plan, in turn, was not followed up with an annual target for 2025.
The government could also devise ways to narrow the gap to the target on paper, through statistical revisions or tweaks to the definition of carbon intensity, as the term has not been defined in China’s NDCs.
Notably, unlike China’s previous NDC, its latest pledge did not include a progress update for carbon intensity. The latest official update sent to the UN only covers the years to 2020.
This leaves some more leeway for revisions, even though China’s domestic “statistical communiques”, published every year, have included official numbers up to 2024.
Coal consumption growth around 2022 was likely over-reported, so statistical revisions could reduce reported emissions and narrow the gap to the target. Including process emissions from cement, which have been falling rapidly in recent years, and changing how emissions from fossil fuels used as raw materials in the chemicals industry are accounted for, so-called non-energy use, which has been growing rapidly, could make the target easier to meet.
2. Will the plan upgrade clean-energy targets or pave the way to exceed them?
The need to accelerate carbon-intensity reductions also has implications for clean-energy targets.
The current goal is for non-fossil fuels to make up 25% of energy supplies in 2030, up from the 21% expected to be reached this year.
This expansion would be sufficient to achieve the reduction in carbon intensity needed in the next five years, but only if energy consumption growth slows down very sharply. Growth would need to slow to around 1% per year, from 4.1% in the past five years 2019-2024 and from 3.7% in the first three quarters of 2025.
The emphasis on manufacturing in the Central Committee’s recommendations for the next five-year plan is hard to reconcile with such a sharp slowdown, even if electrification will help reduce primary energy demand. During the current five-year period, China abolished the system of controlling total energy consumption and energy intensity, removing the incentive for local governments to curtail energy-intensive projects and industries.
Even if the ratio of total energy demand growth to GDP growth returned to pre-Covid levels, implying total energy demand growth of 2.5% per year, then the share of non-fossil energy would need to reach 31% by 2030 to deliver the required reduction in carbon intensity.
However, China recently set the target for non-fossil energy in 2035 at just 30%. This risks cementing a level of ambition that is likely too low to enable the 2030 carbon-intensity target to be met, whereas meeting it would require non-fossil energy to reach 30% by 2030.
There is ample scope for China to beat its targets for non-fossil energy.
However, given that the construction of new nuclear and hydropower plants generally takes five years or more in China, only those that are already underway have the chance to be completed by 2030. This leaves wind and solar as the quick-to-deploy power generation options that can deliver more non-fossil energy during this five-year period.
Reaching a much higher share of non-fossil energy in 2030, in turn, would therefore require much faster growth in solar and wind than currently targeted. Both the NDRC power-sector plan for 2025-27 and China’s new NDC aim for the addition of about 200 gigawatts (GW) per year of solar and wind capacity, much lower than the 360GW achieved in 2024.
If China continued to add capacity at similar rates, going beyond the government’s targets and instead installing 250-350GW of new solar and wind in each of the next five years, then this would be sufficient to meet the 2030 intensity target, assuming energy demand rising by 2.5-3.0% per year.
All previous wind and solar targets have been exceeded by a wide margin, as shown in the figure below, so there is a good chance that the current one will be, too.
While the new pricing policy for wind and solar has created a much more uncertain and less supportive policy environment for the development of clean energy, provinces have substantial power to create a more supportive environment.
For example, they can include clean-energy projects and downstream projects using clean electricity and green hydrogen in their five-year plans, as well as developing their local electricity markets in a direction that enables new solar and wind projects.
3. Will the plan set an absolute cap on coal consumption?
In 2020, Xi pledged that China would “gradually reduce coal consumption” during the 2026-30 period. The commitment is somewhat ambiguous.
It could be interpreted as requiring a reduction starting in 2026, or a reduction below 2025 levels by 2030, which in practice would mean coal consumption peaking around the midway point of the five-year period, in other words 2027-28.
In either case, if Xi’s pledge were to be cemented in the 15th five-year plan then it would need to include an absolute reduction in coal consumption during 2026-30. An illustration of what this might look like is shown in the figure below.
However, the commitment to reduce coal consumption was missing from China’s new NDC for 2035 and from the Central Committee’s recommendations for the next five-year plan.
The Central Committee called for “promoting a peak in coal and oil consumption”, which is a looser goal as it could still allow an increase in consumption during the period, if the growth in the first years towards 2030 exceeds the reduction after the peak.
The difference between “peaking” and “reducing” is even larger because China has not defined what “peaking” means, even though peaking carbon emissions is the central goal of China’s climate policy for this decade.
Peaking could be defined as achieving a certain reduction from peak before the deadline, or having policies in place that constrain emissions or coal use. It could be seen as reaching a plateau or as an absolute reduction.
While the commitment to “gradually reduce” coal consumption has seemed to fade from discussion, there have been several publications discussing the peak years for different fossil fuels, which could pave the way for more specific peaking targets.
State news agency Xinhua published an article – only in English – saying that coal consumption would peak around 2027 and oil consumption around 2026, while also mentioning the pledge to reduce coal consumption.
The energy research arm of the National Development and Reform Council had said earlier that coal and oil consumption would peak halfway through the next five-year period, in other words 2027-28, while the China Coal Association advocated a slightly later target of 2028.
Setting a targeted peak year for coal consumption before the half-way point of the five-year period could be a way to implement the coal reduction commitment.
With the fall in oil use in transportation driven by EVs, railways and other low-carbon transportation, oil consumption is expected to peak soon or to have peaked already.
State-owned oil firm CNPC projects that China’s oil consumption will peak in 2025 at 770m tonnes, while Sinopec thinks that continued demand for petrochemical feedstocks will keep oil consumption growing until 2027 and it will then peak at 790-800m tonnes.
4. Will ‘dual control’ of carbon prevent an emission rebound?
With the focus on realising a peak in emissions before 2030, there could be a strong incentive for provincial governments and industries to increase emissions in the early years of the five-year period to lock in a higher level of baseline emissions.
This approach is known as “storming the peak” (碳冲锋) in Chinese and there have been warnings about it ever since Xi announced the current CO2 peaking target in 2020.
Yet, the emphasis on peaking has only increased, with the recent announcement on promoting peaks in coal consumption and oil consumption, as well as the 2035 emission-reduction target being based on “peak levels”.
The policy answer to this is creating a system to control carbon intensity and total CO2 emissions – known as “dual control of carbon” – building on the earlier system for the “dual control of energy” consumption.
Both the State Council and the Central Committee have set the aim of operationalising the “dual control of carbon” system in the 15th five-year plan period.
However, policy documents speak of building the carbon dual-control system during the five-year period rather than it becoming operational at the start of the period.
For example, an authoritative analysis of the Central Committee’s recommendations by China Daily says that “solid progress” is needed in five areas to actually establish the system, including assessment of carbon targets for local governments as well as carbon management for industries and enterprises.
The government set an annual target for reducing carbon intensity for the first time in 2024, but did not set one for 2025, also signaling that there was no preparedness to begin controlling carbon intensity, let alone total carbon emissions, yet.
If the system is not in place at the start of the five-year period, with firm targets, there could be an opportunity for local governments to push for early increases in emissions – and potentially even an incentive for such emission increases, if they expect strict control later.
Another question is how the “dual” element of controlling both carbon intensity and absolute CO2 emissions is realised. While carbon intensity is meant to be the main focus during the next five years, with the priority shifting to reducing absolute emissions after the peak, having the “dual control” in place requires some kind of absolute cap on CO2 emissions.
The State Council has said that China will begin introducing “absolute emissions caps in some industries for the first time” from 2027 under its national carbon market. It is possible that the control of absolute carbon emissions will only apply to these sectors.
The State Council also said that the market would cover all “major emitting sectors” by 2027, but absolute caps would only apply to sectors where emissions have “stabilised”.
5. Will it limit coal-power and chemical-industry growth?
During the current five-year period, China’s leadership went from pledging to “strictly control” new coal-fired power projects to actively promoting them.
If clean-energy growth continues at the rates achieved in recent years, there will be no more space for coal- and gas-fired power generation to expand, even if new capacity is built. Stable or falling demand for power generation from fossil fuels would mean a sharp decline in the number of hours each plant is able to run, eroding its economic viability.
Showing the scale of the planned expansion, researchers from China Energy Investment Corporation, the second-largest coal-power plant operator in China, project that China’s coal-fired power capacity could expand by 300GW from the end of 2024 to 2030 and then plateau at that level for a decade. The projection relies on continued growth of power generation from coal until 2030 and a very slow decline thereafter.
The completion of the 325GW projects already under construction and permitted at the end of 2024, as well as an additional 42GW permitted in the first three quarters of 2025, could in fact lead to a significantly larger increase, if the retirement of existing capacity remains slow.
In effect, China’s policymakers face a choice between slowing down the clean-energy boom, which has been a major driver of economic growth in recent years, upsetting coal project developers, who expect to operate their coal-fired power plants at a high utilisation, or retiring older coal-power plants en masse.
Their response to these choices may not become clear for some time. The top-level five-year plan that will be published in March 2026 will likely provide general guidelines, but the details of capacity development will be relegated to the sectoral plans for energy.
The other sector where fossil fuel-based capacity is rapidly increasing is the chemical industry, both oil and coal-based. In this sector, capacity growth has led directly to increases in output, making the sector the only major driver of emissions increases after early 2024.
The expansion is bound to continue. There are more than 500 petrochemical projects planned by 2030 in China, of which three quarters are already under construction, according to data provider GlobalData.
As such, the emissions growth in the chemical sector is poised to continue in the next few years, whereas meeting China’s 2030 targets and commitments would require either reining it in and bringing emissions back down before 2030, or achieving emission reductions in other sectors that offset the increases.
The expansion of the coal-to-chemicals industry is largely driven by projects producing gas and liquid fuels from coal, which make up 70% of the capacity under construction and in planning, according to a mapping by Anychem Coalchem.
These projects are a way of reducing reliance on imported oil and gas. In these areas, electrification and clean energy offer another solution that can replace imports.
Conclusions
The five-year plans being prepared now will largely determine the peak year and level of China’s emissions, with a major impact on China’s subsequent emission trajectory and on the global climate effort.
The targets in the plan will also be a key test of the determination of China’s leadership to respect previous commitments, despite setbacks.
The country has cultivated a reputation for reliably implementing its commitments. For example, senior officials have said that China’s policy targets represent a “bottom line”, which the policymakers are “definitely certain” about meeting, while contrasting this with other countries’ loftier approach to target-setting.
Depending on how the key questions outlined in this article are answered in the plans for the next five years, however, there is the possibility of a rebound in emissions.
There are several factors contributing to such a possibility: solar- and wind-power deployment could slow down under the new pricing policy, weak targets and a deluge of new coal- and gas-power capacity coming onto the market.
In addition, unfettered expansion of the chemical industry could drive up emissions. And climate targets that limit emissions only after a peak is reached could create an incentive to increase emissions in the short term, unless counteracted by effective policies.
On the other hand, there is also the possibility of the clean-energy boom continuing so that the sector beats the targets it has been set. Policymakers could also prioritise carbon-intensity reductions early in the period to meet China’s 2030 commitments.
Given the major role that clean-energy industries have played in driving China’s economic growth and meeting GDP targets, local governments have a strong incentive to keep the expansion going, even if the central government plans for a slowdown.
During the current five-year period, provinces and state-owned enterprises have been more ambitious than the central government. Provinces can and already have found ways to support clean-energy development beyond central government targets.
Such an outcome would continue a well-established pattern, given all previous wind and solar targets have been exceeded by a wide margin.
The difference now is that a significant exceedance of clean-energy targets would make a much bigger difference, due to the much larger absolute size of the industry.
To date, China’s approach to peaking emissions and pursuing carbon neutrality has focused on expanding the supply and driving down the cost of clean technology, emphasising economic expansion rather than restrictions on fossil-fuel use and emissions, with curbing overcapacity an afterthought.
This suggests that if China’s 2030 targets are to be met, it is more likely to be through the over-delivery of clean energy than as a result of determined regulatory effort.
The post Q&A: Five key climate questions for China’s next ‘five-year plan’ appeared first on Carbon Brief.
Q&A: Five key climate questions for China’s next ‘five-year plan’
Climate Change
China Briefing 19 February 2026: CO2 emissions ‘flat or falling’ | First tariff lifted | Ma Jun on carbon data
Welcome to Carbon Brief’s China Briefing.
China Briefing handpicks and explains the most important climate and energy stories from China over the past fortnight. Subscribe for free here.
Key developments
Carbon emissions on the decline
‘FLAT OR FALLING’: China’s carbon dioxide (CO2) emissions have been either “flat or falling” for almost two years, reported Agence France-Presse in coverage of new analysis for Carbon Brief by the Centre for Research on Energy and Clean Air (CREA). This marks the “first time” annual emissions may have fallen at a “time when energy demand was rising”, it added. Emissions fell 0.3% during the year, driven by a fall in emissions “across nearly all major sectors”, said Bloomberg – including the power sector. It said the chemicals sector was an exception, where emissions saw a “large jump from a surge of new plants using coal and oil” as feedstocks. The analysis has been covered around the world by outlets ranging from the New York Times, Bloomberg and BBC News through to Der Spiegel, CGTN and the Guardian.
TOP TASKS: President Xi Jinping listed “persisting in following the ‘dual-carbon’ goals” as one of eight “key” elements of economic work in 2026, according to a December speech just published in Qiushi, the Chinese Communist party’s leading journal for political theory. This included “deeply advancing” carbon reduction in key industries and “steadily promoting a peak in consumption of coal and oil”, according to the transcript. The National Energy Administration (NEA) also outlined a number of priority tasks for the department, including resolving “grid integration challenges” to encourage greater use of renewable energy and “boosting investment” in energy resources, said energy news outlet International Energy Net.
ETS EXPANSION: Meanwhile, the government has asked “heavy polluters” in several sectors not yet covered in China’s emissions trading scheme (ETS) to report their emissions for 2025, reported Bloomberg, in a “key step” for the further expansion of the carbon market. The affected industries are the “petrochemical, chemical, building materials (flat glass), nonferrous metals (copper smelting), paper and civil aviation industries”, according to the original notice posted by the Ministry of Ecology and Environment (MEE), as well as steel and cement companies not yet covered by the ETS.
State Council issued ‘unified’ power market guidance
POWER TRADE: China will aim for “market-based transactions” to account for 70% of total electricity consumption by 2030, according to new policy guidance released by China’s State Council and published by International Energy Net. The policy also called for greater “integration” of cross-regional trading and “fundamentally sound” market-based pricing mechanisms. On renewable power, the guidance urged officials to “expand the scale of green power consumption” and establish a “green certificate consumption system that combines mandatory and voluntary consumption”, as well as encourage “implementation of inter-provincial renewable energy priority dispatch plans”. It also calls for “roll[ing] out spot trade nationwide by 2027, up from just 4% of the total transactions today”, reported Bloomberg.
CLEAN-POWER PUSH: An official at China’s National Development and Reform Commission said in a Q&A published by BJX News that establishing a “unified” national power market is “crucial for constructing a new power system”. A separate analysis by Beijing-based power services firm Lambda reposted on BJX News argues that China’s unified power-market reforms – which have been “more than two decades” in the making – will allow for “widespread integration” of renewable energy, resolving the challenge of wind and solar “generating but being unable to transmit and integrate”. Business news outlet Jiemian quoted Xiamen University professor Lin Boqiang saying that, while power-market reform may present clean-energy companies with “growing pains” in the short term, it will “force the industry to develop healthily” in the long term.
EU tariffs lifted on first firm’s China-built EV imports
‘SOFTENED’ STANCE: The Chinese government has “softened its stance” on electric vehicle (EV) manufacturers who seek to independently negotiate with the EU on prices for their exports to the bloc, said Reuters, after it previously “urged the bloc not to engage in separate talks with Chinese manufacturers”. The move came as Volkswagen received an exemption from tariffs for one of its EVs that is made in China and imported to the EU, which it committed to sell above a specific price threshold, reported Bloomberg. It added that the company also pledged to follow an import quota and “invest in significant battery EV-related projects” in the EU.
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‘MADE IN EU’ MELTDOWN: Meanwhile, EU policymakers attempted to agree legislation that may force EV manufacturers to ensure “70% of the components in their cars are made in the EU” if they wish to receive subsidies, reported the Financial Times. A draft of the plan was ultimately rejected by nine European Commission leaders and commission president Ursula von der Leyen, Borderlex managing editor Rob Francis wrote on Bluesky.
BRAZIL BACKTRACKS: Brazil has “scrapped” a tariff exemption for Chinese EV manufacturers that allowed cars assembled in Brazil with parts imported from China to be sold at much lower prices than similar vehicles made from parts imported from other countries, reported the Hong Kong-based South China Morning Post. Separately, Bloomberg reported on the surge of tariff-free Chinese EVs that has enabled Ethiopia to ban the import of combustion-engine cars.
PRICE-WAR BAN: The Chinese government has “banned carmakers from pricing vehicles below cost”, reported Bloomberg, in an effort to clamp down on a “persistent price war” affecting the industry. China’s car industry, “particularly in the EV segment”, has seen “aggressive discounting, subsidies and bundled promotions” pushing down profitability for companies across the supply chain, said the state-run newspaper China Daily.
More China news
- POWERFUL WIND: China has connected a 20-megawatt offshore wind turbine – the “world’s most powerful” and “equivalent to a 58-story building” – to the grid, reported state news agency Xinhua.
- PROVINCIAL MOVES: Anhui has become the first Chinese province to release data on how much carbon different forms of power in the province emits per kilowatt-hour of power, according to power news outlet BJX News.
- RARE-EARTH RUNES: China may hold a “policy briefing” on export restrictions for rare earths and other critical minerals in March, according to Reuters.
- NO CHINA CREDITS: The US confirmed that clean-energy tax credits will not be available for companies that are “overly reliant on Chinese-made equipment”, said Reuters.
Spotlight
Ma Jun: ‘No business interest’ in Chinese coal power due to cheaper renewables
Carbon Brief spoke with Ma Jun, one of China’s most well-known environmentalists, about how open data can keep pressure on industry to decarbonise and boost interest in climate change.
Ma is director of the Beijing-based Institute of Public and Environmental Affairs (IPE), an organisation most well known for developing the Blue Map, China’s first public database for environment data.
Speaking to Carbon Brief during the first week of COP30 in Brazil last November, the discussion covered the importance of open data, key challenges for decarbonising industry, China’s climate commitments for 2035, cooperation with the EU and more.
Below are highlights from the conversation. The full interview can be found on the Carbon Brief website.
Open data is helping strengthen climate policy
- On how data transparency prevents environmental pollution in China: “From that moment [when the general public began flagging environmental violations on social media in 2014], it was no longer easy for mayors or [party] secretaries to try to interfere with the enforcement, because it’s being made so transparent, so public.”
- On encouraging the Chinese government to publish data: “The ministry felt that they had the backing from the people, basically, which helped them to gain confidence that data can be helpful and can be used in a responsible way.”
- On China’s new corporate disclosure rules: “We’re talking about what’s probably the largest scale of corporate measuring and disclosure now happening [anywhere in the world].”
- On the need for better emissions data: “It will be impossible to get started without proper, more comprehensive measuring and disclosure, and without having more credible data available.”
‘Green premium’ still challenging despite falling prices
- On the economics of coal: “There’s no business interest for the coal sector to carry on, because increasingly the market will trend towards using renewables, because it’s getting cheaper and cheaper”.
- On paying for low-carbon products: “When we engage with them and ask why they didn’t expand production, they say that producing these items will have a ‘green premium’, but no one wants to pay for that. Their users only want to buy tiny volumes for their sustainability reports.”
- On public perceptions in China of climate change: “It’s more abstract – [we’re talking about] the end of the century or the polar bears. People don’t feel that it’s linked with their own individual behaviour or consumption choices.”
Climate cooperation in a new era
- On criticism of China’s climate pledge: “In the west, the cultural tendency is that if you want to show that you’re serious, you need to set an ambitious target. Even if, at the end of the day, you fail, it doesn’t mean that you’re bad…But in China, the culture is that it is embarrassing if you set a target and you fail to fully honour that commitment.”
- On global climate cooperation: “The starting point could be transparency – that could be one of the ways to help bridge the gap.”
The role of civil society in China’s climate efforts
- On working in China as a climate NGO: “What we’re doing is based on these principles of transparency, the right to know. It’s based on the participation of the public. It’s based on the rule of law. We cherish that and we still have the space to work [on these issues].”
- On the climate consensus in China: “The environment – including climate – is the area with the biggest consensus view in [China]. It could be a test run for having more multi-stakeholder governance in our country.”
This interview was conducted by Anika Patel at COP30 in Belém on 13 November 2025.
Watch, read, listen
GREEN ALUMINIUM: Lantau Group principal David Fishman wrote on LinkedIn about why China’s aluminium smelters are seeking greater access to low-carbon power, following heated debate over a Financial Times article.
STRONGER THAN EVER: Isabel Hilton, chair of the Great Britain-China Centre, spoke on the Living on Earth podcast about China’s renewables push and exports of clean-energy technologies.
CUTTING CORNERS?: Business news outlet Caixin examined how a surge in turbine defects at one wind farm could be due to “aggressive cost-cutting and rapid installation waves”.
POLES APART: BBC News’ Global News Podcast examined the drivers behind China’s flatlining emissions, as revealed by Carbon Brief.
600
In gigawatts, China’s total capacity of coal plants that are “flexible” and – in theory – better able to balance the variability of renewables, according to a new report by the thinktank Ember.
New science
- China will see a 41% decline in in coal-mining jobs over the next decade under current climate policies | Environmental Research Letters
- During 2000-20, China’s per-person emissions of CO2 increased from 106kg to 539kg in urban households and from 35kg to 202kg in rural households, indicating that the inequality between urban and rural households is shrinking | Scientific Reports
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The post China Briefing 19 February 2026: CO2 emissions ‘flat or falling’ | First tariff lifted | Ma Jun on carbon data appeared first on Carbon Brief.
Open and transparent data can accelerate the decarbonisation of China’s industries and boost public interest in climate change, says Ma Jun.
Ma – one of China’s most recognisable environmental activists – says that early experiments with publishing real-time air quality data have paved the way for greater openness from the Chinese government towards publishing greenhouse gas emissions data.
However, he tells Carbon Brief in a wide-ranging interview, more needs to be done to encourage “multi-stakeholder” participation in climate efforts and to improve corporate emissions disclosure.
He also notes that China faces significant “challenges” in reducing emissions from “hard-to-abate” sectors, where companies struggle to find consumers willing to pay a “green premium” for low-carbon versions of their products.
Ma is the founder and director of the Institute of Public and Environmental Affairs (IPE), a Beijing-based NGO focused on environmental information disclosure and public participation.
The IPE is most well-known for developing the Blue Map, China’s first public database for environment data.
Ma has been a long-term advocate for environmental protection in China.
Prior to founding the IPE, he covered environmental pollution as an investigative reporter at the Hong Kong-based South China Morning Post.
He also authored China’s first book on the serious water pollution challenges facing the country.
Speaking to Carbon Brief during the first week of COP30 in Brazil last November, the discussion covered the importance of open data, key challenges for decarbonising industry, China’s climate commitments for 2035, cooperation with the EU and more.
- On how data transparency prevents environmental pollution in China: “From that moment [that the general public began flagging environmental violations on social media], it was no longer easy for mayors or [party] secretaries to try to interfere with the enforcement, because it’s being made so transparent, so public.”
- On encouraging the Chinese government to publish data: “The ministry felt that they had the backing from the people, basically, which helped them to gain confidence that data can be helpful and can be used in a responsible way.”
- On China’s new corporate disclosure rules: “We’re talking about what’s probably the largest scale of corporate measuring and disclosure now happening [anywhere in the world].”
- On air-pollution policies creating a template for climate action: “It started from the pollution control side and now we want to see that happen on the climate side.”
- On paying for low-carbon products: “When we engage with them and ask why they didn’t expand production, they say that producing these items will have a ‘green premium’, but no one wants to pay for that. Their users only want to buy tiny volumes for their sustainability reports.”
- On public perceptions of climate change: “It’s more abstract – [we’re talking about] the end of the century or the polar bears. People don’t feel that it’s linked with their own individual behaviour or consumption choices.”
- On the need for better emissions data: “It will be impossible to get started without proper, more comprehensive measuring and disclosure, and without having more credible data available.”
- On criticism of China’s climate pledge: “In the west, the cultural tendency is that if you want to show that you’re serious, you need to set an ambitious target. Even if, at the end of the day, you fail, it doesn’t mean that you’re bad…But in China, the culture is that it is embarrassing if you set a target and you fail to fully honour that commitment.”
- On global climate cooperation: “The starting point could be transparency – that could be one of the ways to help bridge the gap.”
- On the economics of coal: “There’s no business interest for the coal sector to carry on, because increasingly the market will trend towards using renewables, because it’s getting cheaper and cheaper”.
- On working in China as a climate NGO: “What we’re doing is based on these principles of transparency, the right to know. It’s based on the participation of the public. It’s based on the rule of law. We cherish that and we still have the space to work [on these issues].”
- On the climate consensus in China: “The environment – including climate – is the area with the biggest consensus view in [China]. It could be a test run for having more multi-stakeholder governance in our country.”
The transcript below has been edited for length and clarity.
Carbon Brief: You have been at the forefront of environmental issues in China for decades. How would you describe the changes in China’s approach to climate and environment issues over the time you’ve been observing them?
Ma Jun: I started paying attention to the issues when I got the chance to travel in different parts of China. I was struck by the environmental damage, particularly on the waterways, the rivers and lakes, which do not just have all these eco-impacts, but also expose hundreds of millions to health hazards.
That got me to start paying attention. So I authored a book called China’s Water Crisis and readers kept coming back to me to push for solutions. I delved deeper into the research and I realised that it’s quite complicated – not just that the magnitude [of the problem] is so big, but that the whole issue is quite complicated, because we copied rules, laws and regulations from the west but enforcement remained weak.
There are huge externalities, but companies would rather just cut corners to be more competitive, put simply. Behind that, there was a doctrine before of development at whatever cost. That was the starting point in China – not just for policymakers, even people in the street, if you asked them at that time, most likely [they] would say: “China’s still poor. Let’s develop before we even think about the environment.”
But that started changing, gradually. Unfortunately, it needed the “airpocalypse” in Beijing and the big surrounding regions to really motivate that change.
In 2011, Beijing suffered from very bad smog and millions upon millions of people made their voices heard – that they want clean air.
The government lent an ear to them and decided to start from transparency, monitoring and disclosing data to the public. So two years after it started and people were being given hourly air quality data [in 2011] – you realised how bad it was. In the first month [of 2013], the monthly average was over 150 micrograms. The WHO standard was 10 at the time – now it’s dropped to five. [Some news reports and studies, based on readings published at the time by the US embassy in Beijing, note significantly higher figures.]
We believe that it’s good to have that data – of course, it’s very helpful – but it’s not enough. Keeping children indoors or putting on face masks are not real solutions, we need to address the sources. So we launched a total transparency initiative with 24 other NGOs calling for real-time disclosure of corporate monitoring data.
To our surprise, the ministry made it happen. From 2014, tens of thousands of the largest emitters, every hour, needed to give people air [quality] data, and every two hours for water [quality].
We then launched an app to help visualise that for neighbourhoods. For the first time, people could realise which [companies] are not in compliance. Even super-large factories – every hour, if they were not in compliance, then they would turn from blue to red [in the app].
And so many people made complaints and petitioned openly – sharing that on social media, tagging the official [company] account. That triggered a chain reaction and changed that dynamic that I described.
From that moment, it was no longer easy for mayors or [party] secretaries to try to interfere with the enforcement, because it’s being made so transparent, so public. The [environmental protection] agencies got the backing from the people and knocked the door open – and pushed the companies to respond to the people.
Then, the data is also used to enable market-based solutions, such as green supply chains and green finance.
Starting first with major multinationals and then extending to local companies, companies compared their lists with our lists before they signed contracts. If any of their [supplier] companies were having problems, they could get a push notification to their inbox or cell [mobile] phone.
That motivates 36,000 [companies] to come to an NGO like us – to our platform – to make that disclosure about what went wrong and how we try to fix the problem, and after that measure and disclose more kinds of data, starting with local emission data and now extending to carbon data.
And for banking and green finance, an NGO like us now helps banks track the performance of three million corporations who want to borrow money from them, as part of the due diligence process. These are just tiny examples to try to demonstrate that there’s a real change.
Before, when I got started, the level of transparency was so limited. When we first looked at government data, at the beginning, there were only 2,000 records of enforcement. So we launched an index, assessed performance for 10 years across 120 cities.
During this process, [we also saw] consensus being made. In 2015, China’s amended Environmental Protection Law [came into effect] and created a special chapter – chapter five – titled [information] transparency and public participation. That was the first ever piece of legislation in China to have such a chapter on transparency.
CB: What motivated that? Was it because they’d already seen this big public backlash?
MJ: They started listening to people and the demand for change, for clean air. And then they started seeing how the data can be used – not to disrupt the society, but to help to mobilise people.
The ministry felt that they had the backing from the people, basically, which helped them to gain confidence that data can be helpful and can be used in a responsible way. Before, they were always concerned about the data, particularly on disruption of social stability, because our data is not that beautiful at the beginning, due to the very serious pollution problem.
When our organisation got started, nearly 20 years ago, 28% of the monitored waterways – nationally-monitored rivers – reported water that was good for no use. Basically, it is so polluted that it’s not good for any use. [Some] 300 million [people] were exposed to that in the countryside, it was very serious.
We’re talking about the government changing its mindset. Of course, the reality is that they found [the data] can be used the responsible way and can be helpful, so they decided to embrace that and to tolerate that, to gradually expand transparency.
Now, China is aligning its system with the International Sustainability Standards Board (ISSB). The environment ministry also created a disclosure scheme, with 90,000 of China’s largest [greenhouse gas] emitters on the list. We and our NGO partners tried to help implement that. We’re talking about billions of tonnes of carbon emissions.
It would have been hard to imagine before, but we’re talking about what’s probably the largest scale of corporate measuring and disclosure now happening [anywhere in the world].
Of course, it’s still not enough. Last year, we also helped the agency affiliated with the ministry to develop a guideline on voluntary carbon disclosure, targeting small and medium sized companies. We now have a new template on our platform – powered by AI – and a digital accounting tool that helps our users measure and disclose nearly 70m tonnes [of carbon dioxide equivalent] last year.
CB: Is there appetite on the industrial side to proactively get involved? Or is local regulation needed that mandates involvement?
MJ: At the beginning, no. If we have the dynamic that I described – at the beginning, whoever cut corners became more competitive. This caused a “race to the bottom” situation and even good companies find it quite difficult to stick to the rules.
But then the dynamic changed. Whoever’s not in compliance with the law will be kicked out of the game. Not only would they receive increasingly hefty penalties or fines, but the data will be put into use in supply chains. Many of our users – the brands – integrate that data into their sourcing, meaning that if [suppliers] don’t solve the problem they will lose contracts. And also banks could give them an unfavourable rating.
All this joint effort could create some sort of – of course, it’s [only a] chance – but some kind of a stick. But it’s also a kind of carrot, because those who decided to do better now benefit. If someone loses business [because they cannot help their consumer with compliance], then that business will [instead] go to those who want to go green.
This change in dynamic is very helpful. It started from the pollution control side and now we want to see that happen on the climate side. That’s why we decided to develop the blue map for zero carbon, to try to map out and further motivate the decarbonisation process – region by region, sector by sector.
You asked about corporations – this is extremely important. China is the factory of the world and 68% of carbon emissions still relate either to the direct manufacturing process or to energy consumption to power the industrial production. So it is very important to motivate them, to create both rules and stimulus – both stick and carrot.
But if you don’t have a stick, you can never make the carrot big enough. That is an externality problem, you never really solve that. We’ve now managed to solve the basic problem – non-compliance and outrageous violations. But that’s the first step. Deep decarbonisation – not just scope one and two, but extending further upstream to reach heavy industry, the hard-to-abate industries – now this is the challenge.
CB: What are your expectations for industrial decarbonisation more broadly, especially given the technology bottlenecks?
MJ: There are still bottlenecks, but we see, actually, some progress is being made. Now corporations in China understand that they need to go in [a low-carbon] direction and some of them are actually motivated to develop innovative solutions.
For example, several major steel manufacturers managed to be able to find ways to produce much lower-carbon steel products. In the aluminium [sector] they also tried and also batteries. Unfortunately, these remain as only pilot projects.
When we engage with them and ask why they didn’t expand production, they say that producing these items will have a “green premium”, but no one wants to pay for that. Their users only want to buy tiny volumes for their sustainability reports – for the rest, they just want the low-cost ones.
They said, the more we produce the green products, the bigger our losses. So we decided to leave these products in our warehouse.
Then we engaged with the brands – the real estate industry, the largest user of iron and steel – and the automobile industry, the second largest. They claimed that if they [purchase greener materials], they would pay a green premium, but their users and consumers have no idea about [green consumption]. They only want to buy the cheapest products – and the more [these manufacturers] produce, the more they suffer losses.
So this means we need a mechanism, with multi-stakeholder participation, to share the burden of that transition – to share that cost of the green transition.
That green premium can only be shared, not one single stakeholder can easily absorb all of this given all the breakneck competition in China – involution – it’s very, very serious and so companies are all stuck there.
What we’re trying to do is to help change that. We assessed the performance of 51 auto brands and tried to help all the stakeholders understand which ones could go low-carbon.
But it’s not enough just to score and rank them. We also need to engage with the public, to have them start gaining an understanding that their choice matters. So how – it’s more difficult, you know? Pollution is much easier. We told them: “Look, people are dumping all this waste.”
CB: It’s all visible.
MJ: Yeah, when people suffer so seriously from pollution – air, water and soil pollution – they feel strongly. They wrote letters to the brands, telling them that they like their products but they cannot accept this.
But on climate, it’s more abstract – [we’re talking about] the end of the century or the polar bears. People don’t feel that it’s linked with their own individual behaviour or consumption choices.
We decided to upgrade our green choice initiative to the 2.0 level. This new solution we developed is called product carbon scan. Basically, you take a picture of any product and services products and an AI [programme] will figure out what product that is and tell you the embodied carbon of that product.
Now, it’s getting particularly sophisticated with automobiles. The AI now – from this year – for most of the vehicles on the streets of China, can figure out not just which brand it is, but which model. We have all these models in our database – 700-800 models and 7,000-8,000 varieties of cars, all of which have specific carbon footprints.
CB: How do you account for all of the different variables? If something changes upstream, if a supplier changes – how do you account for that?
MJ: The idea is like this – now, this is mostly measured by third parties, our partners. We also have our emission factors database that we developed. So we know that, as you said, there are all these variables. For the past six months, we got our users to take pictures of 100,000 cars. We distributed them to 50 brands and [calculated] that the total carbon footprint was 4.2m tonnes, for the lifecycle of these 100,000 cars. Each brand got their own share of this.
So we wrote letters – and we’re still writing letters now, 10 NGOs in China, we’re writing letters now to the CEOs of these 50 brands – to tell them that this is happening. Our users, consumers of their products, are paying attention to this and are raising questions. We have two demands.
First, have you done your own measuring for the product you sell in China? Do you have plans to measure and disclose those specific details? Because if third parties can do it, so can they. It’s not space technology, they can do it and obviously they own all this data. They understand much better about the entire value chain and it’s much easier for them to get more accurate figures. With the “internet of things” and new technologies, for some products, they can get those details already, so the auto industry should be getting close to [achieving] that.
The second question is, you all have set targets for carbon reduction and carbon neutrality. We know that most of you are not on track. Even the best ones – Mercedes-Benz is at the top of our rankings – are seeing their carbon intensity going up. Not just the total volume [of emissions], but products’ carbon intensity is going up instead of going down. So, obviously, they haven’t really decarbonised their upstream – steel and aluminium. So [we ask them]: “What’s your plan? Can you give me an actionable, short- or mid-term plan on the decarbonisation of these upstream, hard-to-abate sectors?”
I think this is the way to try to tap into the success of pollution control and now extend that to cover carbon.
CB: It seems a challenge facing China’s climate action that policymakers often flag is MRV [monitoring, reporting and verification] and data in general. You’re the expert on this. Would you agree? Are there big challenges around MRV that China needs to address before it can progress further?
MJ: This is a prerequisite, in my view. To have [to] measure, disclose and allow access to data is a prerequisite for any meaningful multi-stakeholder effort. I wouldn’t underestimate the challenge in the follow-up process – the solutions, the innovations, the new technologies that need to be developed to decarbonise – but it will be impossible to get started without proper, more comprehensive measuring and disclosure, and without having more credible data available.
I take this as a starting point – a most important starting point. I’m so happy to see that there’s a growing consensus on that. In China, the government decided to embrace the concept of the ISSB, embrace the concept of ESG reporting, and to allow an NGO like us to try to help with the disclosure mechanism.
This is very powerful and very productive, and the reason that we could create that solution is because China pays so much attention to product carbon footprints, of course, motivated by the EU legislations, like the carbon border adjustment mechanism (CBAM) and others. In some ways, it’s quite interesting to see the EU set these very progressive rules, but then China responds and decides to create solutions and scale them up.
On the product carbon footprint alone, the Ministry of Ecology and Environment (MEE) coordinated 15 different ministries to work on it, with a very tight schedule – targets set for 2027 and then 2030 – [implying] very fast progress. We work together with our partners on a new book telling businesses – based on emission factors – how to handle it and how to proceed, in terms of practical solutions.
All this is just to say that, on the data and MRV side, China has already overcome its initial reluctance, or even resistance. Now [it] is in the process of not just making progress and expanding data transparency, but also trying to align that with international practice.
And at COP30, I actually launched a new report [titled the Global City Green and Low-Carbon Transparency Index]…The transparency index actually highlighted that, of course, developed cities are still doing better, but a whole group of Chinese cities are quickly catching up. Trailing behind are other global south cities.
When China decides to do something, it isn’t just individual businesses or even individual cities [that see action taken]. There will be more of a platform-based system – meaning there is an [underlying] national requirement, which can help to level the playing field, with regions or sectors possibly taking up stricter requirements, but not being able to compromise the national ones [by setting lower targets].
So, with MRV, I have some confidence. That doesn’t mean it’s easy. Particularly on the product carbon footprint, there are so many challenges. Trying to make emission factors more accurate is quite difficult, because products have so many components and the whole value chain can be very long and complicated. But with determination, with consensus, I’m still confident that China can deliver.
And in the meantime, what is now going on in China, increasingly, could become a contribution to global MRV practice.
CB: It’s interesting that you mentioned that. Talking to people at the COP30 China pavilion, people from global south countries see China as a climate leader and want to learn about what’s going on in China. By contrast, developed countries seem more focused on the level of ambition in China’s NDC [its climate pledge, known as a nationally determined contribution]. How would you view China’s role in climate action in the next five years?
MJ: On the NDC, my personal observation – I come from an NGO, so I don’t represent the government’s decision here – is that culturally, there’s some sort of differences, nuanced differences – or very obvious differences – here.
In the west, the cultural tendency is that if you want to show that you’re serious, you need to set an ambitious target. Even if, at the end of the day, you fail, it doesn’t mean that you’re bad, you still achieve more than if you’d set a lower target. That’s the mentality.
But in China, the culture is that it is embarrassing if you set a target and you fail to fully honour that commitment. So they tend to set targets in a slightly more conservative way.
I’m glad to see that [China’s] NDC is leaving space for flexibility – it said that China will try to achieve a higher target. This is the tone, and in my view it gives us the space and the legitimacy to try to motivate change and develop solutions to bend the curve faster. Even if the target is not that high, we know that we will try to beat that.
And then, there’s the renewables target for 1,200 gigawatts (GW) by 2030, a target that was achieved last year – six years early. Now we’ve set a target of 3,600GW – that means adding 180GW every year. But, as you know, over the past several years [China’s renewable additions] have been above 200GW.
So you can see that there’s a real opportunity there and we know that China will try to overdeliver. There’s no kind of a good or bad, or right or wrong, with these two different cultural [approaches].
But one thing I hope that we all focus more on is implementation – on action. Because we do see that, for some of the global targets that have already been set, no-one seems to be paying any real attention to them – such as the tripling of [global] renewable capacity.
We all witnessed that, in Dubai at COP28, a target was agreed and accepted by the international community. China’s on track, but what about the others? Most countries are not on track.
The global south, it’s not only for their climate targets – the [energy] transition is essential for their SDG [sustainable development goal] targets. But now they lag so far behind. That’s a pity, because now there’s enough capacity – and even bigger potential – to help them access all this much faster.
But geopolitical divides, resource competition, nationalism, protectionism – all of this is dividing us. It’s making global climate governance a lot more difficult and delaying the process to help [others in the] global transition. It’s very difficult to overcome these problems – probably it will get worse before it gets better.
But if we truly believe that climate change is an existential threat to our home planet, then we should try to find a way to collaborate a bit more. The starting point could be transparency – that could be one of the ways to help bridge the gap.
In China, we used to have a massive gap of distrust between different stakeholders. People hated polluting factories, but they also had suspicions around government agencies giving protection to those factories. So there’s all this distrust.
With transparency, it’s easier for trust to be built, gradually, and the government started gaining confidence [in sharing data] because they saw with their own eyes that people came together behind them. Before, [people] always suspected that [the government] were sheltering the polluters. But from that moment, they realised that the government was serious and so gave them a lot of support.
Globally – maybe I’m too negative – I do think that it would [improve the chances for us all to collaborate] if we had a global data infrastructure and a global data platform, that doesn’t just give [each country’s] national data but drills down – province by province, city by city, sector by sector and, eventually, to individual factories, facilities and mines. For each one of these, there would be a standardised reporting system, giving people the right to know. I think through this we could build trust and use it as a starting point for collaboration.
I sit on several international committees – on air, water, the Taskforce on Nature-related Financial Disclosures (TFND), transition minerals, and so on. In each of these, I often make suggestions on building global data infrastructure. Increasingly, I see more nodding heads, and some have started to make serious efforts. TNFD is one example. They already have a proposal to develop a global data facility on data. The International Chamber of Commerce also put forward a proposal on the global data infrastructure on minerals and other commodities.
Of course, in reality, there will be many difficulties – data security, for example. So maybe it cannot be totally centralised, we need to allow for decentralised regional systems, but you could also create catalogues to allow the users to [dig into] all this data.
CB: And that then inspires people to look into issues they care about?
MJ: Yes and through that process, we will create more consensus, create more trust and gradually formulate unified rules and standards.
And we need innovative solutions. In today’s world, security is something that’s not just paid attention to by China, in the west it’s a similar [story]. There are a lot of concerns about data security – growing concerns – so I think eventually there will be innovation to solve them. I’m still hopeful!
CB: Speaking of international cooperation, how has the withdrawal of the US from the Paris Agreement affected prospects for China-EU cooperation?
MJ: It will have a mixed impact, of course. Having the largest economy and second-largest emitter withdraw will have a big impact on global climate governance, and will in some way create negative pressure on other regions, because we’re all facing the question of: “If they don’t do it, why should we?” We also have those questions back home. I’m sure the EU is also facing this question.
But in the meantime, I hope that China and the EU realise that they have no choice but to work together – if they still, as they claim, truly believe in [the importance of] recognising the existential threat posed by climate change, then what choice do they have but to work together?
Fundamentally, we need a multilateral process to deal with this global challenge. The Paris Agreement, with all its challenges, still managed to help us avoid the worst of the worst. We still need this UNFCCC process and we need China and the EU to help maintain it.
At the last COP[29 in Azerbaijan], for the first time, it was not China and the US who saved the day. Before, it was always the US and China that made a deal and helped [shepherd] a global agreement. But last year, it was China and the EU that made the agreement and then helped to reach [a global deal] in Azerbaijan.
I do think that China and the EU have both the intention and the innovative capacity, as well as a very, very powerful business sector. I’m still hopeful that these two can come together at this COP [in Brazil].
CB: We’ve spoken a lot about heavy industry and industrial processes. Coal is a very big part of China’s emissions profile. In the short term, how do you see China’s coal use developing over the next five to 10 years?
This ties into that complicated issue of the geopolitical divide. The original plan was to use natural gas as the transition [fuel], which would make things much easier. But geopolitical tensions means gas is no longer considered safe and secure, because China has very little of this resource and has to depend on the other regions, including the US, for gas.
That, in some way, pushed towards authorising new coal power plants and, in some way, we are all suffering for that. In the west as well. We all have to create massive redundancies for so-called insecurity, we’re all bearing higher costs and we’re all facing the risk of stranded assets, because we have such a young coal-power fleet.
The only thing we can do is to try to make sure that these plants increasingly serve only as a backup and as a way to help absorb high penetration of renewables, because now this is a new challenge. Renewables have been expanding so fast that it’s very difficult – because of its intermittent nature – to integrate it into the power grid. New coal power can help absorb, but only if we can make [it] a backup and not use it unless there’s a need. Of course, that means we have to pay to cover the cost for those coal plants.
The funny thing is that there’s no business interest for the coal sector to carry on, because increasingly the market will trend towards using renewables, because it’s getting cheaper and cheaper. So the coal sector, for security and integration of renewables, will be kept. But it will play an increasingly smaller role. In the meantime, the coal sector can help balance the impact through making chemicals, rather than just energy.
In the meantime, [we need to] try to find ways to accelerate the whole energy transition and electrify our economy even faster. That’s a clear path towards both carbon peaking and carbon neutrality in China.
It’s already going on. Carbon Brief’s research already highlights some of the key issues, such as from March [2024] emissions are actually going down. That cannot happen without renewables, because our electricity demand is still going up significantly. In the meantime, the cost of electricity is declining.
This allows China to find its own logic to stick to the Paris Agreement, to stick to climate targets and even try to expand its climate action, because it can benefit the economy. It can benefit the people.
I think Europe probably could also learn from that, because Europe used to focus on climate for the climate’s sake. With [the Russia-Ukraine] war going on, that makes it even more difficult.
CB: You mean the green economy narrative?
MJ: Yes, the green economy narrative is not highlighted enough in Europe. Now, suddenly, it’s about affordability, it’s about competition, and suddenly they feel that they’re not in a very good position. But China actually focuses more on the green economy side. China and the EU could – hand-in-hand – try to pursue that.
CB: That leads perfectly to my last question. How important is the role of civil society now in developing climate and environmental policy in China?
MJ: We all trust in the importance of civil society. This is our logo, which we designed 20 years ago. Here are three segments: the government, business and civil society.
Civil society should be part of that. But we all, realistically, understand that the government is very powerful, businesses have all the resources, but civil society is still very limited in terms of its capacity to influence things.
But still, I’m glad to see that we have a civil society and NGOs like us continue to have the space in China to do what we’re doing. What we’re doing is based on these principles of transparency, the right to know. It’s based on the participation of the public. It’s based on the rule of law. We cherish that and we still have the space to work [on these issues].
We’re lucky, because the environment – including climate – is the area with the biggest consensus view in our society. It could be a test run for having more multi-stakeholder governance in our country. I hope that, increasingly, this can help build social trust between stakeholders and to see [climate action] benefit society in this way.
I know it’s not easy – there are still a lot of challenges [for NGOs] and not just in China. We work with partners in other regions – south-east Asia, south Asia, Africa and Latin America – and it’s hard to imagine the challenges they could face, such as serious challenges to their personal safety.
Now, even in the global north, NGOs are under pressure. So we have a common challenge. Back to the issue of transparency. I hope that transparency also can be a source of protection for NGOs.
When all of us need to [take action to address climate issues], whether that be taking samples of water, protesting on the ground – being face-to-face and on the front line – without some sort of multi-stakeholder governance, then it will be far more difficult for NGOs to participate.
If the government can provide environmental monitoring data to the public, if corporations can make self-disclosures, then it will help with this, to some extent. Because it’s not new – environmental blacklists in China are managed by the government, based on data, based on a legal framework. That can be a source of protection.
So I hope that NGO partners in other parts of the world can recognise that we should work together to promote transparency.
CB: Thank you.
The post Ma Jun: ‘No business interest’ in Chinese coal power due to cheaper renewables appeared first on Carbon Brief.
Ma Jun: ‘No business interest’ in Chinese coal power due to cheaper renewables
Uganda’s plan to use future revenues from its emerging oil industry to drive economic development may not work as expected, because evidence so far shows that the government’s effort to extract and export its crude oil may not produce the returns it is counting on, analysts have warned.
A new report by the Institute for Energy Economics and Financial Analysis (IEEFA) found that Uganda stands to benefit far less from oil production than previously projected, with revenues set to be half of earlier estimates if the world transitions away from fossil fuels on a path to reaching net zero emissions.
Uganda’s oil ambitions involve developing two oilfields on the shores of Lake Albert – Tilenga and Kingfisher – and constructing the 1,443-km East African Crude Oil Pipeline (EACOP), with the aim of transporting 230,000 barrels of crude per day to Tanzania’s Tanga port for export.
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Led by oil major TotalEnergies and China National Offshore Oil Company (CNOOC), alongside the Uganda National Oil Company (UNOC) and Tanzania Petroleum Development Corporation, the project was given the financial go-ahead in 2022.
Will Scargill, one of the IEEFA report’s authors, told an online launch this week that oil may have seemed a historically attractive option for Uganda but the benefits it could yield are very sensitive to major risks, including cost overruns around the project and in the refining sector, which it also plans to enter.
“The EACOP project is expected to cost much more than the original expectations, so it’s a major project risk in Uganda as well,” he said.
The start of oil production and exports through the East Africa pipeline had been expected by 2025 – nearly 20 years after commercially viable oil was first discovered in the country – but has now been delayed until late 2026 or 2027.
Meanwhile, the cost of construction – particularly for the EACOP part of the project – has continued to rise, reaching around $5.6 billion, a 55% increase from the $3.6 billion projected shortly before it got financial approval, the report said.
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Beyond delays and cost overruns, “there’s the risk the impact of the accelerating shift away from fossil fuels will have on the oil market,” Scargill said.
The report said the most significant factors for the Ugandan oil industry – which are beyond its control – have been the reduced outlook for international trade spurred by recently imposed US tariffs and the growing uptake of electric vehicles (EVs), particularly in China – which has led to a peak in transport fuel demand and an expected peak in overall oil consumption by 2027.
The 2025 oil outlook from the International Energy Agency (IEA) shows that growth in global oil demand will fall significantly by the end of the decade before entering a decline, driven mainly by electrification in transport which will displace 5.4 million barrels per day of global oil demand by the end of the decade.
In addition, structural changes in global energy markets, including oil supply growth outside the OPEC+ bloc – a group of major oil-producing countries including Saudi Arabia and Russia that sets production quotas – particularly in the US, Brazil and Guyana, are lowering prices.
“It’s a particularly bad time to be taking single big bets on particular sectors that are linked to external markets,” said Matthew Huxham, a co-author of the IEEFA report.
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To make matters worse, Uganda’s public finances have been weakened in the past decade by external shocks including higher US interest rates and commodity prices, resulting in downgrades of the country’s sovereign credit rating, he added.
“What that means is, generally speaking, there is less fiscal resilience to shocks,” Huxham said.
Lower global demand for oil would likely see lower prices, profits and revenues for the Ugandan government, the report authors said. In addition, a global shift to renewable energy would mean Uganda selling even fewer barrels into international markets.
All of these factors suggest that investment in Uganda’s oil industry “would unlikely be as transformational as expected” for its development, Scargill said.
Climate Home News reached out to the Uganda National Oil Company and EACOP but had not received a response at the time of publication.
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Uganda has invested a significant amount of government funds not only in the oil pipeline but also in supporting infrastructure such as a planned refinery. The report authors raised concerns about revenue-sharing agreements under which foreign investors are entitled to recover their costs first, taking a larger share of oil revenues in the early years of production.
IEEFA estimates that while TotalEnergies’ and CNOOC’s returns could fall by 25-34% as the world uses less oil and moves from fossil fuels to clean energy, Uganda’s expected revenues could decline by up to 53%.
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Uganda is pursuing a $4.5-billion oil refinery project in Hoima District, with the country’s oil company UNOC due to take a 40% stake. To finance part of this investment and other oil-related infrastructure, UNOC has secured a loan facility of up to $2 billion from commodity trader Vitol.
Under the deal, Vitol gains priority access to oil revenues, placing it ahead of the Ugandan government when money starts flowing in, the report said. The IEEFA analysts warn that this will likely displace or defer planned use of the revenues for other government spending on things like health, education and climate adaptation, especially if oil production and the refinery construction are delayed or profits disappoint.
“Even if the refinery project is on time and on budget, the refinery and loan repayments could consume 40% of Uganda’s oil revenues through 2032,” Scargill noted.
Pointing to recent cost overruns at oil refinery projects in Africa, the report authors said Nigeria’s
Dangote refinery ended up costing more than twice the original estimate – jumping from $9 billion to over $18 billion.
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They said analysis shows the Uganda refinery will cost 25% more than planned, on top of an expected overrun of over 50% on the EACOP project, cutting the annual return rate to 10%.
“This means there is a high chance the project, by itself, will not make any money,” the report added.
Responding to the report, the StopEACOP coalition said the analysis confirms that beyond causing ongoing environmental harm and displacing hundreds of thousands, the project “does not make economic sense, especially for the host countries”.
They called on financial institutions, including Standard Bank, KCB Uganda, Stanbic Uganda, Afreximbank, and the Islamic Corporation for the Development of the Private Sector, which are backing the “controversial” EACOP project, “to seriously engage with the findings of the IEEFA reports and reconsider their support”.
Prioritise climate-resilient investments instead
In another report released alongside the one on oil project finances, IEEFA argued that Uganda could achieve stronger and more effective development outcomes by redirecting its scarce public resources towards climate-resilient, electrified industrialisation rather than doubling down on oil.
Uganda is among the countries most vulnerable to climate change, yet ranks low in readiness to cope with its impacts. The report authors urged the government to apply stricter criteria when deciding how to spend public funds, focusing on things like improving access to modern energy services and climate adaptation.
The IEEFA report recommended investments in off-grid and mini-grid solar electrification, agro-processing, cold storage, crop irrigation and better roads as lower-risk alternatives to investing in fossil fuels.
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Investments that take climate risks into account could also attract concessional climate finance and align with Uganda’s fourth National Development Plan and Just Transition Framework, the report said.
“They also take less long to construct, are easy to deploy, pay back over a shorter period and they also put less pressure on the system,” Huxham added.
The post Uganda may see lower oil revenues than expected as costs rise and demand falls appeared first on Climate Home News.
Uganda may see lower oil revenues than expected as costs rise and demand falls
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