Mainland China
With a cumulative score of 2.4, Mainland China ranks number 1 among emerging markets and number 11 in the global ranking.
- Emerging markets
- Asia-Pacific
2.50 / 5
Power score
2.54 / 5
Transport score
1.98 / 5
Buildings score
Low-carbon strategy
Net-zero goal and strategy
China has the goals to peak its carbon emissions before 2030 and reach net-zero before 2060.
Nationally Determined Contributions (NDC)
The government updated its NDC in December 2020 with new targets, including a 65% decline in GDP carbon intensity by 2030, compared with 2005. This is a minor adjustment of its 2017 target of a 60-65% decline.
Fossil fuel phase-out policy
President Xi Jinping announced in April 2021 that the country will start phasing down coal consumption from 2026-30. No explicit policy directive has been announced.
Power
Power policy
China launched its renewables portfolio standards in 2020, mandating power consumers and retailers to source a set share of clean energy. Retail liberalization now allows wind and solar assets in at least 25 of China’s 31 provinces to sell power directly to end users. The sale of coal-fired power, which still dominates the power system, has been liberalized in most of the country.
Power policies
Power prices and costs
In October 2020, China imposed caps on the lifetime ‘hours of generation’ for which subsidy will be paid for all existing and new renewables projects. BNEF categorizes it as a retroactive cut on subsidies, as it alters the earlier practice that subsidized the full actual generation.
Power market
China’s power market is undergoing a series of changes that will impact both generation and retail. For renewable energy, generous subsidies that spurred rapid growth are coming to an end. It is still unclear whether policy makers will extend feed-in tariffs or deploy auctions for future projects. So far, decisions are made on an annual and province-by-province basis.
Utility privatisation
Which segments of the power sector are open to private participation?
Wholesale power market
Does the country have a wholesale power market?
Doing business and barriers
There are no formal barriers to private sector participation in developing generation assets. However, private players face common disadvantages when it comes to obtaining local permits to construct, permits for grid connection, or obtaining cheap debt financing, while state-owned companies are treated preferentially.
Currency of PPAs
Are PPAs signed in or indexed to U.S. Dollars or Euro?
Bilateral power contracts
Can a C&I (Commercial and Industrial) customer sign a long-term contract (PPA) for clean energy?
Bilateral power contracts
Can a C&I (Commercial and Industrial) customer sign a long-term contract (PPA) for clean energy?
Bilateral power contracts
Can a C&I (Commercial and Industrial) customer sign a long-term contract (PPA) for clean energy?
Fossil fuel subsidies
Does the government influence the wholesale price of fossil fuel (used by thermal power plants) down through subsidies?
Fossil fuel taxes
Does the government influence the wholesale price of fossil fuel (used by thermal power plants) up through taxes?
Transport
EV market
China is a global leader in electric vehicles. It currently has a target for EVs to account for 20% of passenger vehicle sales by 2025 and build 4.8 million chargers by 2020. The government provides upfront purchase grants for EVs, although the level of support has been decreasing, and exempts EVs from purchase taxes. China uses fuel-economy standards to mandate fuel consumption limits for passenger cars. The first set of standards were issued in 2004.
EV policy
Transport policies
Fuel economy standards
Does the country have a fuel economy standard in place?
Buildings
Buildings market
In the building sector, China's central government encourages heating supplied using geothermal, biomass and solar. National building standards mandate energy efficiency levels for residential and public buildings as well as building heat energy consumption.
Together with local governments, it subsidizes the adoption of low-carbon heating. Most financial incentives for low carbon building improvements differ by region. In some, geothermal projects may receive a 50% rebate from the government. The country does not have a boiler scrappage scheme or incentive in place. Still, it does have broad policies encouraging boiler retrofits, emissions controls and energy efficiency improvements.
Energy performance standards
Are there minimum energy performance standards for buildings?
Energy efficiency plan
Does the country have a national energy efficiency plan?