1 China’s Low-carbon Development Xue Jinjun, Professor at School of Economics, Nagoya University Chairman of Academic Committee, Institute of Global Low-carbon Economy ( UNFCCC Conference China Corner: Green Development in China

2 Contents I.China’s High Carbon Economy II.A Theory for the Low-carbon Economics III.China Towards a Low-carbon Economy IV.Conclusion

3 1, China’s High Carbon Economy (1) China’s High Growth

4 Figure 2 GDP Per Capita 2, China’s High Carbon Economy (1) China’s High Growth Source: IMF ， World Economic Outlook CIA, World Bank ， World Development Indicators 2011.

5 1, China’s High Carbon Economy (2) Export-led growth Figure 4 Trade Ratio in China [(Export + Import) / GDP] Source: China Statistics Yearbook 2011.

6 Source: World Bank, Data Base, China. 1, China’s High Carbon Economy (2) Export-led Growth Export and CO2 Emission in China

7 1, China’s High Carbon Economy ( 3) China’s environment Kuznets Curve – SO2 Source: China Statistics Yearbook 2011.

8 1, China’s High Carbon Economy (4) China’s Carbon Kuznets Curve – CO2 Source: IMF ， World Economic Outlook CIA, World Bank ， World Development Indicators 2011.

9 Ⅰ. China’s High Carbon Economy (6) The world largest carbon emitter The Shares of China in the world Population: Manufacturing Production Source: IMF ， World Economic Outlook CIA, World Bank ， World Development Indicators 2011.

10 2. A Theory for the Low-carbon Economy (3) Carbon and environment constrained EKC

11 2. A Theory for the Low-carbon Economy (5) The Low-carbon catch-up theory and a new EKC LCE with new Tech.

12 3, China Toward a Low-carbon Economy (1) Background  Copenhagen Accord (COP15, Denmark 2009): United States sets its targets that would reduce GHG emissions to 17% below 2005 levels by 2020; 42% by 2030; and 83% by European Union promised to cut its GHG emissions by 30% below 1990 levels by New Japan government pledged to cut its GHG emissions by 25% below 1990 levels by Canada's target is to reduce GHG emissions by 20% below 2006 levels by China announced its intention to reduce the CO2 emissions intensity within its economy by 40-45% by 2020.

13 3. China’ Toward a Low-carbon Economy (2) Decreasing of CO2 Emission Per GDP

14 3, China Toward a Low-carbon Economy (3) Energy Structure in China Source: China’s Statistical Yearbook, 2011

15 Achievements gained Energy Intensity of GDP reduced by 19.06% Accumulat ed energy savings exceed 0.6 billion tce Accumulated CO2 emission reduction amounts to 1.4 billion tons

16 3, China Toward a Low-carbon Economy (3) Energy Intensity in China Source: Xue and Zhu (2011). GDP* (billion RMB Yuan) Energy (Mtce) Energy Intensity (Tce/10K RMB Yuan) Energy-saving (Mtce) The Accumulated Energy-saving during the period of 2006 and The Fixed Energy-saving of 2006 and

17 3, China Toward a Low-carbon Economy (4) Energy Saving Achievement in the period of the 11 th 5-year Plan Source: Xue and Zhu (2011). 11 th FYPReality status Annual growth rate of GDP (%)7.5%11.2% GDP in 2005 (trillion RMB Yuan) Energy Intensity in 2005 (tce/10k RMB Yuan) Improvement Rate of Energy Intensity (%) GDP in 2010 (based on 2005 constant price, trillion RMB Yuan) Energy Intensity in 2010 (tce/10k RMB Yuan) Total fixed energy-savings (Mtce)678760

18 3, China Toward a Low-carbon Economy (5) Factor Decomposition of Energy Saving Effect Source: Xue and Zhu, 2011 Energy-savings (Mtce) Contribution Ratio (%) Industrial Structure ﹡ Industrial Sector Commercial & Residential Sector Agriculture & Construction Sector Transportation Sector Total

19 3, China Toward a Low-carbon Economy (6) Contribution of key policies to carbon intensity improvement of GDP ( ) Source: Xue and Zhu, 2011

20 Conclusions on decomposition of energy intensity of GDP Energy saving due to structural effect mostly comes from structural adjustment within the secondary sector and tertiary sector –Structural adjustment among the primary sector, the secondary sector and the tertiary sector only contribute about 7.9% Energy-savings (Mtce) Contribution Rate (%) Industrial Structure1, Internal Secondary Industrial Structure4, Internal Tertiary Industrial Structure5, Internal Industry Sector Structure2, Internal Industry Subsector Structure4, Total18, Energy-saving and its Contributions from Structure Change for 11 th FYP

21 Conclusions on decomposition of energy intensity of GDP From the perspective of action based approach, most energy saving comes from the ten key energy saving projects.

22 3, China Toward a Low-carbon Economy (7) Green-Low-Carbon Development in the 12 th FYP Source: The 12 th FYP, 2011 Targets The 11 th FYPThe 12 th FYP 2005 （ Real) 2010 （ Planed) ） Annual Growth （ % ） Attribute 2010 （ Real ） 2015 （ Plan) Annual Growth （ % ） Attribute GDP （万亿元） E xpectative %Expectative Shares of non-fossil energy in total energy (%) Constraint Decrease of Energy Intensity (%) --[20]Constraint--[16]Constraint CO2 reduction per unite GDP （ % ） [17]Constraint

23 3, China Toward a Low-carbon Economy (8) Non-fossil Energy Development Plan in the 12 th FYP Source: Xuan Xiaowei, 2011 Year Share Changes of Non-fossil Energy in total energy consumption (%) （ the 12 th FYP ） （ Planned Targets) 15 Average Annual Changes 1990~ ~2005 （ 10 th FYP ） ~2009 （ 11 th FYP ） ～ 2015 （ 12 th FYP ） ～ 2020 （ 13 th FYP ） ～

24  China became the second super economic power as well as the largest carbon emitter in the world.  China, as an emerging economy and responsible super power, should take bigger responsibility and act as a leader in carbon emission reduction.  China has been making the biggest contribution to the global worming world issue by actively dealing reducing energy intensity and carbon emissions.  The 12 th FYP will lead China to a Green-low-carbon Economy. 4, Conclusion