Yang Fan, Chief Policy Analyst, CITIC Securities
The goal of reducing energy consumption per unit of GDP by 13.5% during the period of China’s 14th Five-Year Plan(2021-2025) now seems challenging to achieve, and it may not stay a rigid goal. It is anticipated that there won’t be a resurgence of “rushing to carbon peak”, but stricter measures will be implemented, especially targeting sectors with high energy consumption and pollution.
In the short term, reducing the proportion of the mining and construction industries, increasing the utilization of clean energy, and enhancing energy efficiency in traditional and high-energy-consuming industries are the three main focal points for reducing energy consumption this year.
Regarding long-term mechanisms, the expansion of the carbon market and the construction of a new energy system are expected to accelerate within the year. It is projected that the steel, electrolytic aluminum, and cement industries will be brought into carbon trading this year, and reforms in the electricity market are also expected to progress rapidly.
