After China's annual Two Sessions in March, policy directives by departmental ministries and provincial governments on energy transition have come into shape. The first quarter of 2021 saw the country experiencing a steady upsurge in renewable energy capacity with a total installed capacity of renewable energy amounting to 948 million kilowatts from 794 million kilowatts by the end of 2019. As China progresses towards the carbon neutrality goal of peaking carbon emissions before 2030 and reaching carbon neutrality in 2060, the local directives supply more details to the 14th Five Year Plan (the "Plan").
The 2021 Energy Policy Guiding Opinions (the "Guiding Opinions") promulgated by the National Energy Administration (the "Administration") state that by the end of 2021, the consumption of coal shall be reduced to under 56% and the consumption of wind and solar energy shall be increased to around 11% of total network electricity consumption. In addition, the Guiding Opinions mandate the construction of transmission networks for renewable energy, with a focus on the networks between the following regions: (1) Shanbei and Hubei, (2) Yazhong and Jiangxi, (3) Baihe Tan and Jiangsu, Fujian and Guangdong, and (4) Baihe Tan and Zhejiang. The Administration further stated during the press conference of the State Council on March 30th that by the end of 2025, the installed capacity of renewable energy shall account for over 50% of the total installed capacity in China and renewable energy is expected to account for around 2/3 of the increase in electricity consumption in China. This policy call parallels the strategic development plans of state energy conglomerates, such as the SINOPEC Group, which announced prioritizing solar and wind-based hydrogen energy production in the future.
Provincial and municipal plans further lay out local targets on energy transition that would further the implementation of the Plan. Shanghai, for example, has announced the city's timeline for reaching carbon neutrality, which calls for peaking carbon emissions before 2025. Jiangsu details the construction of wind and solar energy projects in Baihe Tan, Nantong, Yancheng and other regions in its provincial 14th five year plan. Provinces with coal and fossil fuels as important income generators also announced plans to increase renewable energy capacity. Shanxi, for example, targets to increase the total operating income of the photovoltaic manufacturing industry to RMB 13 billion by 2022. Henan estimates to increase the share of non-fossil fuel energy in total energy consumption by over 5% by the end of 2025. Western provinces, such as Sichuan, announced plans that mandate the construction of energy transmission networks that would support the consumption of renewable energy across provinces. Guangdong has also supplied details of annual investments in renewable energy in its provincial 14th five year plan, which envisions the total installed capacity of renewable energy to be around 180 million kilowatts by the end of 2025.
Policy plans targeting non-urban centres have come forth, such as "Guidelines for Increasing the Speed of the Development of Low-Carbon Construction at Counties and Towns (Exposure Draft)" circulated by the Ministry of Housing and Urban-Rural Development, which encourages the construction of low-carbon infrastructure projects at non-urban centres. More local policy directives would be unveiled in the coming months, which would further respond to and help implement the Plan as China realizes its clean energy goals.
National Energy Administration, Transcript of the 2021 Second-quarter Press Conference
National Energy Administration, Transcript of the 2020 First-quarter Press Conference
State Council Information Office briefing on China's Renewable Energy Development
National Energy Administration, 2021 Energy Policy Guiding Opinions
SINOPEC Group, Sinopec Accelerates Hydrogen Energy Development to Build World-leading Clean Energy Chemical Company
Shanghai Municipal People's Government, Outline of the 14th Five-Year Plan and 2035 Vision for Shanghai's Economic and Social Development
Jiangsu Development and Reform Commission, Jiangsu National Economic and Social Development of the 14th Five-year Plan and the Outline of the 2035 Vision
The People's Government of Shanxi Province, Shanxi National Economic and Social Development of the 14th Five-year Plan and the Outline of the 2035 Vision
Shanxi Department of Industry and Information Technology, the Three-year Action Plan for the Development of Photovoltaic Manufacturing Industry in Shanxi Province (2020-2022)
The People's Government of Henan Province, Henan National Economic and Social Development of the 14th Five-year Plan and the Outline of the 2035 Vision
The People's Government of Sichuan Province, Sichuan National Economic and Social Development of the 14th Five-year Plan and the Outline of the 2035 Vision
People's Government of Guangdong Province, Guangdong National Economic and Social Development of the 14th Five-year Plan and the Outline of the 2035 Vision
Ministry of Housing and Urban-Rural Development, Guidelines of Fastening the Development of Low-Carbon Construction at Counties and Towns (Exposure Draft)
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