For 18 years, China has been developing legislation to govern security, innovation and corporate activities in the energy sector as it plans a transition to low-carbon power and sustainable development.
Long stalled by traditional energy interests, the State Council has finally sent a draft to the National People’s Congress (NPC) Standing Committee for review.
The slow and incremental move belies the rapid progress being made in the sector to help China meet its goal of net-zero emissions by 2060. It had already crossed 50 percent by the end of last year.
It’s not just climate change. Beijing wants to improve security, reduce dependence on energy imports and become more self-sufficient in the face of growing competition with the West, led by the United States.
Regarding China as a strategic competitor, Washington opposed Chinese steel imports and banned high-end semiconductor exports.
China’s new energy exports aren’t immune to tensions — the U.S. has complained about overcapacity in solar panels, electric vehicles and lithium-ion batteries.
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Strong typhoon winds smash windows in China, killing at least 3 people
Strong typhoon winds smash windows in China, killing at least 3 people
Beyond emissions targets, China is driven by a desire to reduce dependence on energy imports. Beijing is mindful that Russia is managing to face tough sanctions over its war with Ukraine — because of Moscow’s energy self-sufficiency.
China, which already boasts a highly electrified economy, sees its strategy as a way to propel the economy to the next level, while pursuing growth in new sectors with high growth potential, such as green energy, technology and innovation.
Unlike the United States, a developed economy whose demand for electricity is roughly split between residential, commercial and industrial by about one-third, 80 percent of Chinese power goes to the latter two.
China needs to diversify its energy mix to become more self-sufficient. Green energy isn’t always reliable – solar panels don’t work at night and wind can die when turbines are idle.
So Beijing is also aggressively pursuing hydrogen power and nuclear power. Additionally, China is spending heavily on modernizing and adding artificial intelligence to help run its power generation network.
Its transition was not without challenges. For example, hydropower generation suffers during severe droughts. Although electricity bills are among the lowest in the world, they should stay that way as China builds the power-hungry data centers needed to shift the economy toward high-end high-tech and innovation.
China’s future economy will not only be knowledge-based, but also energy-intensive. This, coupled with its desire for self-reliance, is the spark behind the rapid growth of its energy sector.