{"id":50006917,"date":"2016-07-27T16:25:34","date_gmt":"2016-07-27T15:25:34","guid":{"rendered":"https:\/\/stage.dialogochino.net\/?p=6917"},"modified":"2023-03-14T11:26:35","modified_gmt":"2023-03-14T11:26:35","slug":"6917-all-eyes-on-chinas-13th-five-year-plan-for-energy","status":"publish","type":"post","link":"https:\/\/dialogue.earth\/en\/energy\/6917-all-eyes-on-chinas-13th-five-year-plan-for-energy\/","title":{"rendered":"All eyes on China\u2019s 13th Five-Year Plan for energy"},"content":{"rendered":"

China\u2019s 13th<\/sup>\u00a0Five-Year Plan for energy (Energy 13FYP) might be one of the most anticipated official documents in the world and is one that will have far-reaching impacts on the carbon trajectory of the world\u2019s no.1 emitter. Recently, information about the plan has begun to surface in the Chinese media.<\/p>\n

On Jul 11, the Economic Reference, a major finance newspaper,\u00a0reported<\/a>\u00a0that publication of the central government policy intently watched by the climate and energy community is \u201cimminent\u201d. More specifically, the report spells out key targets that are being considered by the country\u2019s energy policymakers.<\/p>\n

This blog intends to summarise the information about those targets based on publicly-available information. Before that, a bit of background.<\/p>\n

What\u2019s up with all the FYPs?<\/h2>\n

The first question anyone new to China\u2019s planning cycles may ask is: What\u2019s the nature or status of this Energy 13FYP? Our readers may remember that in March, China unveiled its 13th<\/sup>\u00a0Five Year Plan for Economic and Social Development (2016-2020), which contains a set of\u00a0climate and energy related targets<\/a>, including an energy consumption cap and a 15% goal for the share of non-fossil based energy in the country\u2019s primary energy mix. If we consider this the \u201cMaster Plan\u201d for all aspects of China\u2019s development in the next five year period, the Energy 13FYP is a specification of that Master Plan for the energy sector, with more detailed targets that will better guide policymaking, government spending and project planning in the sector.<\/p>\n

The chart below illustrates the hierarchy of Chinese plan making, which locates the Energy 13FYP as a \u201cSpecial Plan\u201d for a specific sector. Special planning follows the completion of national general plans, and its process is less predictable. It is noteworthy that for the 12th<\/sup>\u00a0Five Year Plan cycle (2011-2015), the Energy plan\u00a0took almost two years<\/a>\u00a0to make and was only released in 2013. Therefore, even if media declare the Energy 13FYP \u201cimminent\u201d, there is no guarantee when exactly it will be published.<\/p>\n

\"Capture\"<\/a>\u00a0(image courtesy of WWF China, \u201cThe 12th<\/sup>\u00a0Five Year Plan: the formulation of China\u2019s major plans and programs 2008-2010 and onwards\u201d)<\/em><\/p>\n

What shall we expect from the Energy 13FYP?<\/h2>\n

The chart below illustrates the numerous 2020 targets already declared by the Chinese government through its Strategic Energy Action Plan (2014-2020) and its national 13th<\/sup>Five Year Plan. They are set against actual levels at the end of 2015 as a benchmark. The comparison serves as basis to gauge if the Energy 13FYP is sufficiently ambitious to meet China\u2019s domestic and international commitments.<\/p>\n

It should be noted that what is currently known about the targets in the Energy 13FYP is based on media reports and publicly available information. It is subject to change depending on ongoing internal consultation and negotiations among policymakers.<\/p>\n

\"Screen_Shot_2016-07-22_at_12.18.25\"<\/a><\/p>\n

\"Screen_Shot_2016-07-20_at_15.46.15\"<\/a><\/p>\n

From this comparison, it is clear that most of the targets in the Energy 13FYP will not be entirely \u201cnew\u201d. Many of them are well in line with existing thinking embodied in previously announced policy items, in particular the Strategic Energy Action Plan (2014-2020), which, at the time of its publication, was already considered\u00a0ambitious<\/a>\u00a0in curbing coal consumption and CO2 emissions beyond international expectations. Yet it is still noteworthy that policymakers seem to be even more determined to squeeze coal\u2019s share in the country\u2019s energy mix, lowering its 2020 percentage in primary energy consumption from 62% to 58%, and capping its consumption at 4.1 Gt (which means roughly 2014 levels).<\/p>\n

The country is also aiming higher for its renewable energy sector, even though different information sources differ on the scale of upward adjustment. In Jun 2016, a deputy administrator of the National Energy Administration (NEA)\u00a0indicated<\/a>\u00a0that wind and solar installed capacity should reach 210GW and 110 GW respectively by 2020, higher than what was declared at the end of 2014. Those numbers seem to have grown even further to 250GW and 150GW in the most recent information released by the Economic Reference.<\/p>\n

Between the lines<\/h2>\n

Media reports about the Energy 13FYP also reveal the following deep-rooted concerns which have troubled Chinese policymakers.<\/p>\n

    \n
  1. Overcapacity<\/strong>: China\u2019s power sector is faced with a severe overcapacity problem. Slowing demand for electricity due to the economic downturn and slashing of energy intensive industries has caused widespread under-utilisation of existing power generation capacities, which are seeing their lowest levels of utilisation since 1978. Yet the country is still seeing\u00a0fast build-up of coal-fired power capacities<\/a>\u00a0as a result of inertia (many projects were approved in the heyday of the economic boom) and perverse incentives (dropping coal price and a government fixed electricity tariff is increasing the profit margin for coal power). The worsening overcapacity situation has prompted regulators to consider putting\u00a0a two-year \u201cfreeze period\u201d<\/a>\u00a0in the Energy 13FYP for the approval of any new coal-fired power projects.<\/li>\n
  2. Curtailment<\/strong>: The other side of the overcapacity coin is\u00a0curtailment of renewable energy<\/a>, particularly wind and solar energy in Western parts of the country. A combination of transmission bottlenecks and market set-up has blocked large chunks of renewable electricity from reaching the grid. In 2015, 15% of China\u2019s wind energy was wasted, a historical high. Based on what\u2019s written about the Energy 13FYP, the problem seems to have pressed policymakers to put more emphasis on reining in curtailment, at least for the first half of the 13th<\/sup>\u00a0Five Year cycle, as opposed to further expansion of installed capacity. Whether this will become a factor that contributes to lower-than-expected wind and solar targets remains to be seen.<\/li>\n<\/ol>\n

     <\/p>\n

    This article was first published by chinadialogue<\/a><\/em><\/p>\n","protected":false},"excerpt":{"rendered":"

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