China Economic Review: Carbon emission dual control needs to be strengthened in the middle of the game

Recently, the Environmental Resources and Resources Department of the National Development and Reform Commission held talks with officials from the development and reform departments of Hubei, Shaanxi, Gansu, and Qinghai provinces regarding the lagging progress in achieving the energy-saving goals of the 14th Five Year Plan. The interview pointed out that the energy consumption intensity of the above-mentioned provinces has fallen behind the progress requirements of the 14th Five Year Plan, and some regions have even increased instead of decreasing. This has once again made the topic of energy consumption dual control a hot topic in public opinion.

As one of the core systems of China's energy conservation work, energy consumption dual control has effectively promoted the improvement of energy utilization efficiency and slowed down the growth rate of energy consumption. If we calculate from the first proposal of unit GDP energy consumption intensity in the 11th Five Year Plan, China has been continuously promoting a decrease in energy consumption intensity for more than 17 years. According to statistics, since 2012, the cumulative energy consumption per unit of GDP in China has decreased by 26.4%, with an average annual decrease of 3.3%, which strongly supports the decrease in carbon emission intensity and plays a positive role in promoting economic transformation and development.

In recent years, with the proposal of China's carbon peak and carbon neutrality goals and the establishment of relevant top-level designs, the shortcomings of the energy consumption dual control system have gradually become apparent, especially in the scientific setting of energy dual control goals, the decomposition and implementation of indicators, and other aspects, which have certain limitations and can no longer fully meet the needs of current economic and social development. Two years ago, some places adopted a series of carbon reduction measures such as power cuts and one size fits all measures for coal-fired power in order to achieve emission reduction targets, which brought a series of chain reactions to the stable operation of the economy. The lessons learned are profound.

Looking back, the fundamental reason for the above phenomenon is that the traditional dual control requirements for energy consumption cannot fully connect with the goals of carbon peak and carbon neutrality. In response to this, the Central Economic Work Conference held in December 2021 made timely adjustments, proposing specific requirements such as "not including the addition of renewable energy and raw material energy consumption in the total energy consumption control" and "creating conditions to achieve the transformation from dual control of energy consumption to dual control of carbon emissions and intensity as soon as possible". The report of the 20th National Congress of the Communist Party of China also clearly proposes to improve the regulation of total energy consumption and intensity, focus on controlling fossil energy consumption, and gradually shift towards a dual control system of total carbon emissions and intensity.

Essentially, the fundamental goals of energy consumption dual control and carbon emission dual control are the same, but the biggest difference lies in the fact that the former is simple and efficient to execute, but its disadvantage is that it cannot distinguish energy types, which limits the use of fossil fuels and also limits the development of renewable energy; The focus of the latter constraint is on the total consumption and intensity of fossil fuels, but the procedures such as carbon accounting and quota allocation are more complex, and the advantage is that the use of renewable energy will no longer be restricted. The shift from dual control of energy consumption to dual control of carbon emissions means that the elasticity of energy consumption in the whole society is greater, and the precision of carbon reduction measures is also higher. In other words, in order for the economy to develop, it is necessary to vigorously develop clean energy, including renewable energy, and to organically integrate energy security, economic development, and climate change through carbon emission control.

However, the transition from dual control of energy consumption to dual control of carbon emissions will not be achieved overnight, and sometimes there may be iterations. Since the beginning of this year, with the vigorous efforts of various regions to "compete for the economy", energy consumption in some areas has continued to increase, bringing significant pressure to the overall decrease in energy consumption intensity in society. In particular, some places are eager to invest in projects, and there has been some relaxation in energy conservation review. The management of high energy consumption, high emissions, and low-level projects is weak, and the overall energy-saving situation is relatively severe. The relevant departments should strengthen energy conservation review and supervision, firmly curb the blind implementation of "two highs and one low" projects, and also make great efforts to promote energy-saving technologies. By benchmarking energy efficiency benchmarks and benchmark levels, we can strengthen the guarantee of high-quality development and energy use.

In the medium to long term, the drumbeat for promoting the transition from dual control of energy consumption to dual control of carbon emissions is also increasing. In July of this year, the second meeting of the Central Committee for Deepening Reform reviewed and approved the Opinions on Promoting the Gradual Shift from Energy Consumption Dual Control to Carbon Emission Dual Control, which pointed out the direction and path for the transformation of dual control in the next period from the institutional level. It emphasized the need to adhere to the principle of establishing first and then breaking through, improve the energy consumption dual control system, optimize and improve regulation methods, strengthen the construction of basic capacity for carbon emission dual control, and improve various supporting systems for carbon emission dual control, actively creating conditions for the establishment and implementation of the carbon emission dual control system.

It should be pointed out that the decrease in energy consumption intensity is a binding indicator of the 14th Five Year Plan outline, which has institutional rigidity in implementation and is a necessary target task to be completed. But constraints are not meant to limit development, but to fly higher, walk more steadily, and accumulate more abundant development momentum. We must adhere to the principle of prioritizing conservation, do a better job in energy conservation at a higher level and with higher quality, and achieve maximum benefits with the minimum cost; We also need to maintain a stable work pace, coordinate the relationship between development and emission reduction, seek truth from facts, act within our capabilities, and maximize the synergistic effects of policies.