Fei Teng

The 1.5°C target and coal sector transition: at the limits of societal feasibility

ABSTRACT National and global mitigation scenarios consistent with 1.5°C require an early phase-out of coal in major coal-dependent countries, compared to standard technical and economic lifetimes. This appears particularly apparent in the light of recent massive investments in coal power capacity, the significant pipeline of coal power capacity coming online, as well as upstream supporting infrastructure. This article analyses the existing and planned capital stock in the coal power sector in the light of scenarios consistent with 1.5°C. The article analyses the political economy and labour aspects of this abrupt and significant transition, in the light of domestic equity and development objectives. Firstly, the article examines employment issues and reviews the existing literature and practice with support schemes for regional and sectoral structural adjustment for the reduction of coal sector activity. Secondly, the paper surveys the domestic political economy of coal sector transition in major coal using countries, namely Australia, South Africa, China and India. A final section provides conclusions and policy recommendations. Key policy insights Achieving mitigation pathways in line with limiting warming to 1.5°C, or even well-below 2°C, would require the early retirement of coal sector assets in production and consumption. Historically, coal sector transition has often been associated with prolonged socio-economic dislocation in affected regions. Policies to accompany affected regions are thus a crucial part of policy mixes to limit warming to 1.5°C and even 2°C. Such policies should be anticipatory and long-term, as opposed to reactive policies focused on short-term measures to smooth the transition. A survey of major coal using countries shows that each is a long way from putting in place a long-term framework to transition the coal sector.

Air quality benefit of China’s mitigation target to peak its emission by 2030

ABSTRACT In 2015, China committed to reducing its emission intensity per unit of gross domestic product by 60–65% from its 2005 rate and to peak its carbon emission by 2030. Problems related to local pollutants and haze are simultaneously worsening in China. This article focuses on the critical topic of co-controlling carbon emission and local air pollutants and evaluates the co-benefit of carbon mitigation in local pollutant reduction by using a partial equilibrium model that links carbon emission and local air pollutants at the technological level. Three conclusions can be drawn from the scenario analysis. First, in the reference scenario, energy consumption and carbon emission continue to increase and air quality is expected to deteriorate in the future. Therefore, current pollutant control measures should be improved. Second, local pollutants will be significantly reduced in the end-of-pipe control scenario, but the reduction will still be inadequate to fulfil the air quality target. Third, emissions of SO2, NOx, and PM2.5 in 2030 will be reduced by 78.85%, 77.56%, and 83.32%, respectively, compared with the 2010 levels in the co-control scenario involving the peaking effort in China. Therefore, the air quality targets can also be achieved when the peaking target is fulfilled. The Nationally Determined Contribution (INDC) of China to peak its emission by 2030 is consistent with its domestic interest to improve local air quality. POLICY RELEVANCE China submitted its INDC to the United Nations Framework Convention on Climate Change in 2015 and has promised to peak its carbon emission by 2030. In recent years, China has also faced severe pressure to address its air pollution problem. Air quality is an important driving force to incentivize more ambitious mitigation measures that can contribute to the simultaneous reduction of carbon emission and air pollutants. Air quality benefit provides a strong justification for the INDC of China and the possibility of early peaking. Moreover, the co-benefit in China can be a reference for other developing countries that are facing the same challenge and can reinforce the initiative of these countries to promote ambitious mitigation actions.

Identifying the industrial sectors at risk of carbon leakage in China

China is gradually establishing an Emissions Trading Scheme (ETS) to implement its plan to peak energy-related carbon emissions by 2030. A central debate on ETS design involves addressing the carbon leakage concern. In this study, a detailed quantitative assessment is conducted to identify the industrial sectors at risk of carbon leakage in China. The identification process is undertaken at the four-digit sector level according to the National Economic Industries Classification. Results show that the majority of emissions quotas must be allocated to several energy-intensive sectors. The criterion that focuses on maximum value at stake filters out 27 four-digit sectors, whereas the dual criterion of carbon and trade intensity highlights 17 four-digit sectors that are considered at actual risk of carbon leakage. Quantitative analysis results indicate that allocating 9% of emission quotas for free is sufficient to compensate these vulnerable sectors. The risk of exposure to carbon leakage can vary significantly due to the different levels of data disaggregation, as per the findings from the comparison of carbon intensity data obtained from four-digit sectors belonging to one two-digit sector in the Standard Industry Classification. Therefore, the importance of using high-quality disaggregated data is highlighted in this research. Official criteria for assessing the key indicators of industrial sectors must be designed to accurately evaluate the sectors at risk of carbon leakage. Policy relevance China is gradually establishing a nationwide Emissions Trading Scheme (ETS). The design of this scheme could significantly influence the economic profits and trade situation of industrial sectors. A central debate on the design of Chinas ETS involves how to address carbon leakage concerns; this question remains unanswered thus far. The evaluation of the extent to which the competitiveness of industrial sectors is affected by the ETS and the identification of sectors at risk of carbon leakage are certainly of practical significance to the design of an applicable range and an appropriate free quota allocation regime for Chinas ETS.

Effects of pollution control measures on carbon emission reduction in China: evidence from the 11th and 12th Five-Year Plans

ABSTRACT SO2 emissions have been declining in China recently. The emission reduction has mainly been achieved engineering reduction, structural reduction, and administrative reduction. In this paper, three key industries (electricity generation, steel, and cement) are selected to measure the effects of SO2 emission reductions, the synergy effects of energy saving, and CO2 emission reduction. The main results show that, during the period of the ‘11th Five-Year Plan’, engineering reduction of coal-fired power plant desulfurization played the most crucial role in the emission reduction; both engineering reduction and structural reduction can achieve low-pollution emission, but the contributions are not the same due to the divergence of relevant industries. Generally speaking, structural reduction can relatively easily achieve the synergy effect of the main pollutants and GHGs; in comparison, however, engineering reduction does not easily achieve the synergy effect. During the ‘13th Five-Year Plan’ period, the following plans are proposed: strengthening the front pollution control, increasing the engineering reduction, narrowing the difference between the pollution reduction engineering ability and the actual pollution reduction effect, and strengthening the supervisory and administrative effect of both the approval of the front end and the running of the middle end. POLICY RELEVANCE China is on the way to realize industrialization and urbanization. The climate-friendly environmental protection strategy is particularly important for rapidly developing countries such as China, because it can address air pollution and climate change issues at the same time in a more economically efficient manner. This paper selects three key industries to evaluate current pollutant control policy synergy effect from the ‘11th Five-Year Plan’ to the ‘12th Five-Year Plan’ period in order to give more sense to policy makers during 13th Five-Year Plan. The estimate of this study shows that the control of pollutants can generally have synergic control effects on GHG emissions and give detailed measures for 13th Five-Year Plan.

Challenges to addressing non-CO2 greenhouse gases in China’s long-term climate strategy

ABSTRACT Under the Paris Agreement, countries are encouraged to submit long-term low greenhouse gas emissions development strategies. Such strategies will merge emissions goals with socio-economic objectives and enable countries to increase their ambition over time, thus offering an opportunity to close the gap between the current emissions trajectory and the Agreement’s ‘well below 2°C’ target. China is in the process of preparing its own long-term strategy. We argue in this article that non-CO2 greenhouse gases (NCGGs) should be an essential component of China’s long-term low-emissions strategy. To incorporate NCGGs into China’s long-term low-emissions development strategy, key scientific and institutional challenges should be addressed, such as uncertainty about the accuracy of NCGG emissions inventories; uncertainty about future projections of NCGG emissions; and institutional coordination deficits and imbalanced policy approaches. Overcoming these barriers will have significant implications for climate change mitigation and can open a path for the development of concrete follow-up actions. Key policy insights Non-CO2 greenhouse gases (NCGGs) make up around 17% of China’s GHG emissions, but China has no quantified target to limit or reduce these gases. NCGG emissions mitigation should be an essential component of Chinas long-term low-emissions strategy, which is currently under development. Considerable uncertainty exists over both historical NCGG emissions data and forecasts. This poses challenges to developing a comprehensive multi-gas strategy. Institutional challenges must also be addressed, such as fragmentation of responsibility for NCGGs.