Skip to content

China Sectors

What is Chinaʼs pathway to limit global warming to 1.5°C?

China’s industry sector accounted for 49% of final energy consumption in 2019. Industrial energy consumption increased substantially between 2002-2014, before somewhat flattening out at around 42 EJ/yr. Industry emissions in China were 5.1 GtCO₂e in 2019 (about 38% of the country’s total GHG emissions in that year, excluding LULUCF). The sector’s energy use has become less emissions intensive in recent years, with a 14% reduction in gCO₂/MJ between 2009-2019. Given the industry sector’s importance to the national economy, and the ongoing initiatives put in place to both reduce industrial energy intensity and transition the sector to higher value-added manufacturing, China has realised a 48.1% reduction in carbon intensity (CO₂ per unit of GDP) in 2019 relative to 2005 levels.25,36,37

A transition towards “green and low-carbon industries” is one of the key components of China’s NDC implementation. The government has already put policies in place to direct capital to green industries such as the manufacturing of electric vehicles and renewable energy technologies and seeks to further improve industrial energy efficiency and resource utilisation.1 In addition, high emitting industries such as steel, cement, and aluminium are likely to be targeted in the expansion of the country’s ETS.4,38

A 1.5°C compatible pathway for China’s industry sector would see energy-related emissions, which were 3124 MtCO₂ in 2019, decrease 71-78% by 2030 and reach zero between 2040 and 2050. This could be driven by increased sectoral electrification and the introduction of hydrogen as an energy carrier and feedstock. Electricity’s share of industrial energy use would reach 72% by 2050. The sector’s emissions intensity could consequently decline by roughly 60% from 2019 to 2030. As this is a much greater decline than the 14% between 2009-2019, increased efforts in energy efficiency and energy transition should be undertaken in the sector.

Similarly, industry process emissions would need to rapidly decline. Some analysed pathways show that emissions should have already peaked in 2020, reaching 1990 levels by 2030 and close to zero by 2050.

1 The People’s Republic of China. China’s Achievements, New Goals and New Measures for Nationally Determined Contributions. 2021.

2 Climate Action Tracker. China. November 2022 update. Climate Action Tracker. 2022.

3 Yvonne Deng, Ursula Fuentes, Hare, B., Welder, L. & Gidden, M. U.S. and China Climate Goals : Scenarios for 2030 and Mid-Century. 2020.

4 Climate Action Tracker. China. May 2022 update. Climate Action Tracker. 2022.

5 Liu, Q. et al. Pathway and policy analysis to China’s deep decarbonization. Chinese J. Popul. Resour. Environ. 15, 39–49 (2017).

6 Zheng, X. et al. Drivers of change in China’s energy-related CO2 emissions. Proc. Natl. Acad. Sci. U. S. A. 117, 29–36 (2020).

7 IEA. Key World Energy Statistics. 2021.

8 Bahr, A. China’s coal capacity surge need not be at odds with ambitious climate action. China Dialogue. 2020.

9 Myllyvirta, L., Zhang, S. & Shen, X. Analysis: Will China build hundreds of new coal plants in the 2020s? Carbon Brief. 2020).

10 Global Energy Monitor et al. Boom and Bust Coal 2022. 2022.

11 Climate Action Tracker. New momentum reduces emissions gap, but huge gap remains – analysis. Climate Action Tracker. 2021.

12 Reuters. China to cut coal use share below 56% in 2021. Reuters. 2021.

13 Wang, C. N. Brief: Coal phase-out in the Belt and Road Initiative (BRI): an analysis of Chinese-backed coal power from 2014-2020. 2021.

14 Wang, C. N. China Belt and Road Initiative (BRI) Investment report 2021. Green BRI Center, International Institute of Green Finance (IIGF). 2022.

15 Kusmer, A. China launches world’s largest carbon market. PRI. 2021.

16 Farand, C. China launches world’s largest carbon market for power sector. Climate Home News. 2021.

17 Jinping, X. Full Text: Remarks by Chinese President Xi Jinping at Leaders Summit on Climate. Xinhuanet. 2021.

18 Xinhua. China unveils plan for new energy vehicle industry. Xinhuanet. 2021.

19 Lutsey, N., Cui, H. & Yu, R. Evaluating Electric Vehicle Costs and Benefits in China in the 2020 – 2035 Time Frame. 2021.

20 Liu, H., Liu, J. & You, X. Q&A: What does China’s 14th ‘five year plan’ mean for climate change? Carbon Brief. 2021.

21 Xu, M. & Singh, S. China cuts ‘carbon intensity’ 18.8% in past five years, in effort to rein in emissions. Reuters. 2021.

22 IEA. Coal Information: Overview. 2020.

23 World Resources Institute. Accelerating the Net-Zero Transition: Strategic Action for China’s 14th Five-Year Plan. 2020. doi:https://doi.org/10.46830/wrirpt.20.00018.

24 IEA. Renewables 2021 Analysis and forecasts to 2026. 2021.

25 The People’s Republic of China. China’s Mid-Century Long-Term Low Greenhouse Gas Emission Development Strategy. 2021.

26 IEA. World Energy Outlook 2021. 2021.

27 Murphy, B. Outline of the People’s Republic of China 14th Five-Year Plan for National Economic and Social Development and Long-Range Objectives for 2035 (English translation). 2021.

28 Yu, Y. Renewable Energy in China’s 14th Five-Year Plan: Five Changes. Energy Iceberg. 2021.

29 Hu, Y. & Cheng, H. The urgency of assessing the greenhouse gas budgets of hydroelectric reservoirs in China. Nat. Clim. Chang. 3, 708–712. 2013.

30 Li, S., Zhang, Q., Bush, R. T. & Sullivan, L. A. Methane and CO2 emissions from China’s hydroelectric reservoirs: a new quantitative synthesis. Environ. Sci. Pollut. Res. 22, 5325–5339. 2015.

31 Xie, X., Jiang, X., Zhang, T. & Huang, Z. Regional water footprints assessment for hydroelectricity generation in China. Renew. Energy 138, 316–325. 2019.

32 Yuefang, D. & Steil, S. China Three Gorges Project resettlement: Policy, planning and implementation. J. Refug. Stud. 16, 422–434. 2003.

33 Lewis, C. China’s Great Dam Boom: A Major Assult on Its Rivers. Yale Environment 360. 2013.

34 Yu, Y. China’s 14th Five-Year Plan for Power Industries (2): No Plans for Wind, Solar & Hydro? Energy Iceberg. 2020.

35 IEA. An Energy Sector Roadmap to Carbon Neutrality in China. 2021.

36 Sandalow, D. Guide to Chinese Climate Policy 2019. 2019.

37 Koty, A. C. What is the China Standards 2035 Plan and How Will it Impact Emerging Industries? China Briefing. 2020.

38 China Dialogue. National carbon market expansion may be delayed to 2023. China Dialogue. 2022.

39 The assessment of GDP carbon intensity follows from that conducted in previous analysis but here we have updated data on historical carbon emissions (using the PRIMAP 2021 database), GDP (using Chinese Statistical Yearbook 2021), and GDP growth projections (from World Bank). The GDP growth rate from 2025-2030 is assumed to be 5% p.a.

40 If only covering CO₂, the target would lead to around 2050 MtCO₂e p.a. in 2060 (excluding LULUCF) or emissions reductions of around 75% below 2005 levels. If the target were to cover all GHG emissions, 2060 emissions would be around 600 MtCO₂e p.a. (excluding LULUCF), or around 92% below 2005 levels.3 The 0.1°C of additional warming by 2100 would be a result of the difference in cumulative emissions between an emissions pathway which follow a carbon neutrality target (leading to greater cumulative emissions) versus a GHG neutrality target (leading to less cumulative emissions).

41 Includes electricity and hydrogen. For it to be zero emissions, it would need to be produced out of renewable energies only.

Chinaʼs energy mix in the industry sector

petajoule per year

Scaling
SSP1 Low CDR reliance
201920302040205040 000
SSP1 High CDR reliance
201920302040205040 000
Low energy demand
201920302040205040 000
High energy demand - Low CDR reliance
201920302040205040 000
  • Natural gas
  • Coal
  • Oil and e-fuels
  • Biofuel
  • Biogas
  • Biomass
  • Hydrogen
  • Electricity
  • Heat

Chinaʼs industry sector direct CO₂ emissions (of energy demand)

MtCO₂/yr

Unit
5001 0001 5002 0002 5003 0003 50019902010203020502070
  • Historical emissions
  • SSP1 High CDR reliance
  • SSP1 Low CDR reliance
  • High energy demand - Low CDR reliance
  • Low energy demand

Chinaʼs GHG emissions from industrial processes

MtCO₂e/yr

5001 0001 5002 00019902010203020502070
  • SSP1 Low CDR reliance
  • SSP1 High CDR reliance
  • Low energy demand
  • High energy demand - Low CDR reliance
  • Historical emissions

1.5°C compatible industry sector benchmarks

Direct CO₂ emissions, direct electrification rates, and combined shares of electricity, hydrogen and biomass from illustrative 1.5°C pathways for China

Indicator
2019
2030
2040
2050
Decarbonised industry sector by
Direct CO₂ emissions
MtCO₂/yr
3 124
679 to 905
179 to 315
20 to 77
2040 to 2050
Relative to reference year in %
−78 to −71%
−94 to −90%
−99 to −98%
Indicator
2019
2030
2040
2050
Share of electricity
Percent
33
45 to 51
65 to 67
72
Share of electricity, hydrogren and biomass
Percent
33
52 to 60
68 to 83
73 to 86

Footnotes