2021-05-31-普华永道-2060碳中和将为中国经济贡献几何_（英文）_14页_2mb

Summary of China Economic Quarterly Q1 2021: Carbon Neutrality and Economic Growth

Core Content

The document explores the economic implications of China's commitment to achieving carbon neutrality by 2060, as announced by President Xi Jinping at the 75th United Nations General Assembly. It outlines the challenges, opportunities, and transformative impacts of this goal on various sectors of the Chinese economy.

Main Points and Key Information

Challenges of Achieving Carbon Neutrality

• High Carbon Intensity: China's economy is still in a developing stage, with a high proportion of coal in its energy consumption structure and a relatively high energy consumption per unit of GDP, which is 1.5 times the world average and 2–3 times that of developed countries.
• Urbanisation and Industrialisation: As the world's largest developing country, China's continued urbanisation and industrialisation will create significant demand for high-carbon industries such as steel, cement, and automobiles.
• Global Context: Developed countries peaked their carbon emissions earlier and have a longer transition period to reach carbon neutrality, while China aims to achieve this in a much shorter timeframe, requiring extraordinary efforts.
• Cumulative Emissions: China's cumulative carbon emissions up to 2014 were 171 billion tons, accounting for 11.9% of the global total, compared to the US and EU's 377 and 326 billion tons respectively, which together accounted for about half of global emissions.

Economic Contributions of Carbon Neutrality

• GDP Growth: Carbon neutrality is expected to contribute more than 2% to China's annual GDP growth over the next 40 years.
• Investment Scale: It is projected that China will need to invest over RMB 120 trillion in the energy sector and up to RMB 400 trillion in related sectors by 2060.
• Long-Term Investment: The Climate Change Research Institute at Tsinghua University estimates that RMB 138 trillion in green investments will be required over the next 30 years to achieve carbon neutrality, while the Global Energy Interconnection Development and Cooperation Organisation (GEIDCO) estimates a total of RMB 520 trillion for the entire country.

Key Sectors and Industries Involved

• Major Sectors: Energy, industry, transportation, and construction are the main sources of carbon emissions in China.
• Major Industries: Steel, building materials, nonferrous metals, chemicals, petrochemicals, electric power, and coal are the primary industries contributing to carbon emissions.
• Emission Structure (2017):
  • Power generation and heating: 42%
  • Manufacturing and construction: 23%
  • Industrial production: 9.7%
  • Transportation: 7.5%
  • Agriculture: 6.1%
  • Fugitive emissions: 5.9%
  • Construction: 4.5%

Strategies for Achieving Carbon Neutrality

• Energy Transition: Shift from fossil fuels (coal, oil, and natural gas) to clean energy sources such as solar, wind, hydropower, nuclear, and hydrogen.
• Targets: Raise the proportion of non-fossil energy in electricity generation to 50% by 2030, and achieve net zero carbon dioxide emissions by 2050.
• Green Transformation: Accelerate the green and low-carbon transformation across the entire society and economy, including afforestation and other measures to enhance carbon sinks.

Impacts on Other Sectors

• Energy Sector: The energy system will undergo a massive transformation, requiring investments in clean energy (47%), energy transmission (32%), energy efficiency (12%), and fossil energy (9%).
• Transportation: The automotive industry will face pressure to transition from fossil fuel vehicles to new energy vehicles, which could lead to significant market shifts and investment opportunities.
• Industry: Sectors like steel and cement will experience increased production costs and potential business shrinkage due to emission reduction policies and the need to purchase carbon quotas.
• Construction and Manufacturing: These sectors will also face challenges in reducing their carbon footprints and adapting to new regulations.

Opportunities and Impacts

• Investment Opportunities: The process of achieving carbon neutrality will drive investment in various sectors, potentially creating new business opportunities for financial institutions and service providers in the green finance and carbon trading markets.
• Economic Significance: The economic impact of carbon neutrality may be no less than that of urbanisation or China's accession to the WTO, and could become a significant turning point for the country's economic development.

Conclusion

Achieving carbon neutrality by 2060 will be a major challenge for China, given its current economic and energy structure. However, it will also be a significant driver of sustainable economic growth, with substantial investment requirements and transformative impacts across multiple sectors. The transition will reshape the economy, create new opportunities, and reinforce China's global role in climate action and sustainable development.

References

• "Comprehensive Report on China's Long-term Low-carbon Development Strategy and Transformation Path", Journal of China's Population, Resources and Environment, 2020
• "Research Report on Carbon Neutrality of China before 2060", Global Energy Interconnection Development and Cooperation Organisation (GEIDCO), March 2021
• "Research on China's Low-carbon Development Strategy and Transformation Path", He Jiankun, Tsinghua University, October 2020
• "March toward Carbon Neutrality before 2060 - Opportunities and Challenges on the Path to Carbon Reduction", Gaoling Industry and Innovation Research Institute, March 2021
• "Achieve Carbon Neutrality: What Can Green Finance Do", Ma Jun, Speech at Shanghai Development Research Foundation, April 2021