China’s state-owned enterprises (SOEs) must decrease their energy consumption and carbon dioxide emissions per unit of output value by 15% and 18% by 2025 from 2020 levels, respectively, as reported by Reuters on December 30. Additionally, for state-owned electricity generation firms, renewable energy is supposed to account for over 50% of their total power installations by 2025. The announcement came in a guidance document published by the State-owned Assets Supervision and Administration Commission (SASAC) of the State Council and will mainly cover 97 SOEs supervised by the SASAC.

The new guideline highlighted tighter capacity limitations on high-emission and energy-intensive industries, including steel, aluminum, cement, coal-fired power, oil refining, and coal chemical. Previously on December 4, 2021, China’s Ministry of Industry and Information Technology (MIIT) also released the 14th Five-Year Plan (FYP) for the green development of the industrial sector, which demanded an increase in clean energy use and strict capacity control for the steel, cement, and aluminum industries, aiming to cut energy intensity by 13.5% and carbon intensity by 18% for these industries from 2021 to 2025. The new guideline would also drive state-owned energy producers to develop renewables. As of the end of 2020, China’s five major state-owned electricity groups, including CHN Energy, China Resources Power [0836:CH], China Huaneng, China Huadian, and China Datang, still saw thermal power take up over 70% of their total electricity generation installations.

Sources:

https://www.reuters.com/business/energy/china-calls-state-firms-cut-energy-consumption-amid-carbon-peak-goals-2021-12-30/

http://www.xinhuanet.com/finance/2021-12/31/c_1128219362.htm

https://www.caixin.com/2021-12-31/101824315.html

https://www.reuters.com/markets/commodities/china-releases-five-year-green-development-plan-industrial-sectors-2021-12-03/