For 2010 EASS Meeting
Co-control of GHGs and Air Pollutants Under China’s 12th Five-Year Plan
HU TaoPolicy Research Center of
Ministry of Environmental Protection (MEP)
Sept 24, 2010, Tsinghua University, Beijing
2
OutlineIntroductionNational Pollution and GHGs Reduction Program Under China’s 12th Five-Year Plan and implication for energy sectorCo-control of Greenhouse Gas Emissions and Other Air PollutantsConclusion
3
Introduction National strategies LawsPrograms
4
Introduction
National strategy China’s Agenda 21 and Sustainable Development as a national strategyEnvironmental Protection and population control as two basic national policies Scientific Concept of Development and transmission from pollution heavy, energy and resource intensive economy to technology and service oriented economy structure• From red 1949, to blue 1979 and now to green
5
Introduction Laws
Energy Saving Law Renewable Energy LawBasic Energy Law being revised
Environmental Protection Law Air Pollution Prevention and Protection ActCircular economy lawCleaner production law
6
IntroductionPrograms
11th five year planNational climate change plan (NCCP)
7
Introduction - 11th Five Year Plan (2006-2010)
20% energy and GHGs intensity reduction
14.38% by end of 2009
10% of SOx reduction13.14% by end of 2009
8
Introduction - National Climate Change Plan (NCCP)
Issued on June 5, 2007 Major components
State of Artimpacts of climate principle and objectivespolicy and measuresinternational cooperation
Key principlesSustainable development Mitigation and adaptation Policy integration and coordination with other sector policiesTechnology innovationCommon but differentiated responsibilities Active international cooperation
9
Introduction - National Climate Change Plan (NCCP)
Targets Mitigation AdaptationR&DPublic Awareness and local management
10
National Climate Change Plan (NCCP)
Quantitative Targets Mitigation •20% energy intensity reduction during 2006-
2010•By 2010 renewable energy taking up 10% of
total energy and nuclear energy 4% of total •By 2010 N2O keeping at the same level of
2005•Control paddy rice and animal methane •50 million ton of carbon sequestration
increasing during 2005-2010
National Pollution and GHGs Reduction Program under 12th five year plan and implication for energy sector
12
National Pollution and GHGs Reduction Program under 12th five year plan and implication for energy sector
Draft of 12th five year plan (2011-2015) SO2 emissions 10%, responsible by MEP• Power sector and non-power sector
NOx emissions x%, responsible by MEP• Power sector• Meeting vehicle emissions standards of G4/Euro IV
PM? Carbon intensity 20% to reflect 40-45% target by 2020, responsible by NDRCRenewable energy taking up y% of total energy mix by 2015, responsible by NDRC
13
National Pollution and GHGs Reduction Program under 12th five year plan and implication for energy sector
Reduction approachesStructure adjustment
• Economy structure • Energy structure• Low tech, high tech structure
Efficiency improvement by engineering and management
• Energy-saving, energy efficiency improving • De-sulfur engineering• De-nitrogen engineering
Scale control• Control scale of production by reducing demand and
exporting– Iron and steel, cement, coke etc– Discouraging exports of high carbon, heavy pollution products
14
Impacts on energy sector efficiency of energy use to be improved a lot
• the win-win measure for both carbon and sulfur, nitrogen • the low cost (even benefits) measure from economic
aspect• MIIT is promoting the energy efficiency program for
industries
changes in energy use towards lower carbon• More wind power, solar and small and micro hydro by y%• More natural gas, oil and biomass • less coal, from 68% to z%
National Pollution and GHGs Reduction Program under 12th five year plan and implication for energy sector
15
Impacts on energy sector Energy price • Shadow energy prices increasing • Energy price still under control by central government
because of social concern and inflation concern• Governmental command and control interventions to
fill the gap between shadow price and actual price
Fuel imports • may increasing for energy security reason and rapid
growing conventional vehicles • may not increasing due to constrains of geo-politics
and electrical cars growing and renewable growing
National Pollution and GHGs Reduction Program under 12th five year plan and implication for energy sector
16
Impacts on energy sector electricity generation built• Coal based:
– Super-critical, super-super critical and testing IGCC – phase out the small power plants under 200 MW
capacity
• Natural gas based• Renewable energy
– Wind – Solar – Small and micro Hydro
• Nuclear
National Pollution and GHGs Reduction Program under 12th five year plan and implication for energy sector
17
Impacts on energy sector
future energy supply and demand in China• BAU scenario• Green scenario• Brown scenario
Means of implementation • Moral education • Mandatory order • Market force
– Carbon tax– resources tax – sulfur and NOx tax/fee
National Pollution and GHGs Reduction Program under 12th five year plan and implication for energy sector
18
Impacts on energy sector Whom to be involved to implement the program• Producers • Consumers• Exporters, importers and consumers abroad
– 23% of carbon emissions – 38% of sulfur emissions – 18% of COD emissions
National Pollution and GHGs Reduction Program under 12th five year plan and implication for energy sector
19
Co-control Under China’s 12th Five-Year Plan
What WhyHow
20
What is co-control ?
21
Concept of co-control
Objective: to maximize net benefits (benefits minus control costs) by designed control measures
Total costs of control measures of air pollutants and GHGs Benefits of health, vegetation and global warming as well as other external benefits
Target: both air pollutants and GHGsWays: to actively control both GHGs and local pollutants To maximize net benefits
Net benefits = Integrated Benefits – Integrated CostsTo maximize it!
Dimensions: technology, project, program, plan, policy etc
22
Review of co-benefit development in China
History of research Ancillary benefits estimation with OECD, ECON, SEPAShijiazhuang Case, West-east Pipeline Case under support of SEPA, Petro-China Shanghai Case, Beijing Case, National assessment of co-benefits under support of USEPA-IESShangxi Taiyuan case by CICERO, ECON, NILU etc GAINS model of China by IIASA, ERIPanzhihua case study support by OECCRFF-Harvard, Tsinghua Univ. studyEnergy Foundation-Renmin University of China in Henan Province Co-control policy design by MEP/DRC - ECON/CICERO team
23
Review of co-benefit development in China
Stage 0 pre-co-benefit period: local pollution control policy and climate change policy were considered independently without links
Stage 1 Ancillary benefit or Secondary benefit period:
Ancillary benefits or secondary benefits of GHGs reduction were aware
24
Review of co-benefits development in China
Stage 2 co-benefit measurement period: it’s realized that local pollution and GHGs are mutually linked to each other and efforts are made to measure co-benefits
Stage 3 co-control period: co-control policies/programs/projects are designed and proposed in order to maximize co-benefits
co-control policy and projects are designed and implemented
25
Relations between co-benefit and co-control
Energy and GHGs Reduction
Pollution control
Co-benefits
Counter-benefits
Impact analysis of existing policy/program
And seeking net benefits
Co-control design for Policy/Program/project
To maximize it!
GHGsEnvironmentalImprovement
Co-benefits
Co-control
GHGs reductionWith maybe
Counter-benefits
EnvironmentalImprovementWith maybe counter-benefits
Co-benefits
27
Why co-control?
New situation of energy-saving and emissions reduction
Good to have control targets of both energy-saving and air pollutants in 11th five year plan of State Council but, existing potential conflicts between energy-saving and air pollutants reductions • End-of-pipe control technology • Implemented by NDRC and MEP separately due
to different mandates assigned by State Council
28
Why co-control ?
GHGs control China’s official commitment by 2020, 40 －45 ％ carbon intensityHow to achieve it by a lower cost way to gain co-benefits?
MEP’s niche in climate regime CO2+SO2 ＋ NOx + PM and …Co-control is the best NAMAs for China
29
How to co-controlPrinciple
The fundamental principle we apply for is cost-benefit/effective, in terms of control of several pollutants and GHGs. We believe this principle should be the base of rational decision-making under market economy system.
HypothesisThis study assumes: root-of-pipe control is more cost-effective than end-of-pipe control of air pollutants and GHGs, when all of environmental costs are internalized.
30
How to co-controlPolicy instrument
to find the right policy to achieve the target and be coherent and coordinated among existing policies To avoid high administrative and management costsTo internalize all of the environmental cots to drive from end-of-pipe technologies to root-of-pipe technologies
Governance support Implementation rate? to find a proper institutional arrangement to support the implementation of policy, structure adjustment and control measure
31
How to co-control in iron and steel sector
-5.63 -5.40
-2.62
-1.67 -1.61 -1.31 -1.30
-0.24 -0.16 -0.15
0.32
1.99 2.63
3.11
6.10
-6
-4
-2
0
2
4
6
8
单位减排成本（元/tSO2eq）
技术名称
钢铁行业技术减排协同控制措施排序
32
How to co-control in power sector
-5.69 -3.26 -2.71 -2.61 -1.09 -0.58 -0.56
1.09 2.99
9.25
14.38
36.09
-10
0
10
20
30
40
单位
减排
成本
（元
/SO
2eq
）
33
How to co-controlSupporting elements
How to choose policy instrument to achieve the goal of co-control • Taxation for carbon and sulphur and pricing
How to make institutional arrangements to ensure the policy to be implemented • NDRC or MEP?• NDRC and MEP?• State Council?
34
Conclusion
Introduction to China’s GHGs and air pollution strategies, laws and programsDraft of 12th five year plan and implications for energy sectorWhat, why and how to co-control of GHGs and air pollutants
