China recently unveiled an ambitious plan to significantly reduce its emissions by the end of the decade. This initiative includes setting quotas for key polluting industries and introducing ‘carbon label certification’ for products, aimed at accelerating the “dual control of carbon emissions.” The dual control approach involves oversight of both total carbon emissions and emission intensity, which measures greenhouse gas emissions per unit of GDP. 

During the next five-year plan period from 2026 to 2030, China aims to incorporate carbon emission indicators, budgets, and forecasts into its economic plans. These will be applied across provinces and industries that are major pollution sources. By 2030, China has committed to peak carbon emissions, demonstrating a significant move towards a sustainable future. 

A crucial element of this plan involves establishing comprehensive carbon accounting standards. This includes evaluating the carbon footprint of individual products and investment projects, setting up a detailed database by 2025, and focusing on controlling emission intensity from 2026 onwards. Major industries like electricity, steel, petrochemicals, construction, and transportation will have specific quotas and will be required to perform emissions assessments. 

The State Council’s plan also includes continuous emissions monitoring and early warning systems for sectors experiencing emission spikes. Furthermore, economic planners are tasked with formulating action plans for carbon peak and neutrality, implementing stringent laws for emissions control and energy savings, and developing emissions indicators for each province. These indicators will account for various factors, such as energy needs and existing carbon sinks. 

In addition, the plan calls for creating standards to determine the ‘carbon footprint’ of products, establishing a product carbon labelling certification system. This comprehensive approach to carbon accounting and a carbon neutral strategy underscores China’s commitment to ESG principles and sustainability reporting. Despite systemic challenges, including data fraud and industry resistance, China’s efforts highlight its resolve to lead in global emission reduction initiatives. 

Sources: 

https://www.asiafinancial.com/china-sets-ambitious-plan-to-further-cut-emissions-by-2030 

https://www.argusmedia.com/en/news-and-insights/latest-market-news/2594527-china-to-set-hard-targets-for-curbing-co2-emissions