China's Carbon Peak Carbon Neutral Progress Report (2023) : Green and low-carbon new industries, new business forms and new models are developing vigorously

Source: Securities Times online

Recently, the "China Carbon Peak Carbon Neutral Progress Report (2023)" (hereinafter referred to as the "Report") jointly issued by the China Center for International Economic Exchanges and the State Power Investment Group Co., Ltd. pointed out that China's "dual carbon" policy system is accelerating the construction, continuous optimization of the energy structure, green and low-carbon new industries, new forms of business, and new models are booming. However, China's "double carbon" goal still faces many challenges, we need to better balance high-quality development and high-level security, accelerate the construction of a new energy system, resolutely hold the bottom line of energy security, resolutely promote clean energy transformation, and provide strong support for high-quality development.

The establishment of a policy system was accelerated

The report points out that the construction of China's "dual carbon" policy system has accelerated and continued to advance. China's "double carbon" key areas, key industries implementation plans and support guarantee plans have been issued, and the "1+N" policy system has been improved and continued to be implemented. In September 2023, the Opinions on Promoting the Gradual Shift from Dual Control of Energy Consumption to Dual Control of Carbon Emissions were officially released, emphasizing the gradual shift from dual control of energy consumption to dual control of carbon emissions. The report believes that this is a further measure to crack the contradiction between energy consumption control and economic development after China officially clarified at the end of 2022 that "new renewable energy and raw material energy consumption are not included in the total energy consumption control". During the "14th Five-Year Plan" period, the basic capacity building of carbon emission dual control will be strengthened, and the supporting systems for carbon emission dual control will be improved. At the same time, in the past year, policies related to the "double carbon" standard and measurement system have been successively introduced. In terms of system construction, it is planned to build a multi-dimensional, multi-field and multi-level carbon peak carbon neutral standard system framework.

From the main local practices sorted out in the "Report", all localities have actively responded to the national "dual carbon" action, 31 provinces, autonomous regions and municipalities have formulated regional carbon peak implementation plans, and the local "dual carbon" policy system is more detailed.

From the actual results, China's energy structure continues to optimize, the installed capacity of renewable energy historically exceeds that of coal power, wind power and photovoltaic have become the dual main body of new power generation and new power generation, energy storage has an explosive growth trend, hydrogen energy has become an important choice to promote the consumption of new energy, promote the deep decarbonization of industrial and other fields and long-term energy storage.

New industries, new forms and new models of business are developing vigorously

The report pointed out that China's green low-carbon new industries, new formats and new models are booming, such as the rapid development of the "new three" industries represented by solar cells, lithium batteries and electric manned vehicles, the hydrogen energy industry is accelerating the development of low-carbon development, and the new energy storage industry is developing rapidly.

In the key areas of energy conservation and carbon reduction, enterprises have steadily advanced their green and low-carbon transformation. Representative examples of the report include: the 3 million tons/year carbon dioxide capture, utilization and storage (CCUS) demonstration project between petrochina and Ningxia Coal Industry Co., LTD., which is the world's first green carbon reduction cooperation between modern coal chemical industry and large-scale oil and gas field exploitation; Xinjiang Kuqa Sinopec Green Hydrogen demonstration project has been fully completed and put into operation, which is the largest direct green hydrogen production project of photovoltaic power generation in China, marking a breakthrough in the industrial scale application of green hydrogen in China; Beijing's first "steel structure + full curtain wall system" "double zero" (zero energy consumption, zero carbon) building sub-center planning exhibition hall started construction; Ningde Times released the "Zero carbon strategy", proposing to achieve carbon neutrality in the core operations by 2025, and the battery factory will all become zero carbon factories.

These cases reflect the acceleration of the integration of new energy and traditional industrial fields, and are vivid practices for enterprises to actively participate in carbon reduction actions.

Many challenges remain

The "report" pointed out that China's "dual carbon" goal is still facing challenges such as the difficulty of new energy consumption, the imperfect basic system such as carbon footprint, the intensified external containment and repression, and the constraints of international carbon rules. Looking forward to the future, we need to better balance high-quality development and high-level security, accelerate the construction of a new energy system, resolutely hold the bottom line of energy security, resolutely promote clean energy transformation, and provide strong support for high-quality development.

The report believes that in 2024, the "dual carbon" work will continue to advance steadily, the top-level design of the construction of the new energy system will be accelerated, and the key points, construction paths, and key areas of the system planning and construction will be further clarified. Energy saving and carbon reduction technologies and industries will accelerate development. We will work on the demand side to promote energy conservation and carbon reduction. In particular, the development of clean coal utilization technology, carbon reduction and decarbonization technology in industrial production links such as steel, chemical industry and metallurgy, carbon-free fuel and raw material replacement technology, and clean and low hydrocarbon application technology will be accelerated. The construction of carbon market system and carbon measurement and other basic systems will be improved at a faster pace. Measures to cope with changes in international rules and external challenges will be gradually improved.

The report emphasizes the need to deepen reforms in key areas. First, we will improve the way the government manages energy. Give play to the decisive role of the market in resource allocation, restore the property of energy commodities, reduce government intervention in energy production, supply and price, promote the establishment of a unified national electricity market, and optimize the market mechanism of the whole oil and gas industry chain. Second, deepen the reform of the electric power system. Improve the power market system with the participation of multiple entities, accelerate the construction of the power spot market, support the participation of new energy power in market transactions, and land "electricity sales through the wall." Improve the benefit realization mechanism of coal power as a backup power source for frequency modulation, peak regulation and capacity, and establish a capacity market. Third, deepen market-oriented reform of oil and gas. We will raise the marketization level of upstream links, and support private enterprises in participating in the exploration and development of oil and gas resources and the building of oil and gas reserve capacity. It is recommended to optimize the management of infrastructure such as pipe networks and improve the ability of resource coordination. We will improve the terminal pricing mechanism for oil and gas products. Fourth, we will improve oversight of the energy market. We will improve the energy regulatory system and measures to adapt to market-oriented reform, weaken the color of administrative management, make good use of price measures, and improve the system of laws, regulations and standards.