Experience and implications both in China and overseas

Summary of low-carbon development experience in foreign countries

Responding to climate change and realizing low-carbon development are sensitive observations that developed countries have touched on earlier. Affected by the Industrial Revolution, developed countries completed the process of urbanization and modernization and saw earlier the problems of climate and environment left behind after the rapid development of the city. They have invested in a new social revolution at the end of the last century in order to slow down and reduce the adverse effects of the previous development. Among them, one of the most fundamental aspects of climate change mitigation and reduction of GHG emissions is energy use. Therefore, the research and development of energy-saving technologies and new energy are often the most practical and effective measures taken by developed countries. In addition, it assists in market incentives and administrative measures to clarify government responsibilities and use market mechanisms to control carbon emissions. To sum up, the successful experiences of developed countries canbe summarized from the following aspects: laws and regulations, fiscal and taxation policies, low-carbon technologies, market instruments and lifestyles.

Formulate targeted planning and protective laws and regulations

Outlines and plans can clearly define emission reduction targets and paths and formulate development directions and approaches. In particular, it is economically feasible and in line with the cost-revenue rules of emission reduction. It can clearly define the rights and interests of various parties and fully mobilize the active participation of governments, industries, and enterprises. On the basis of the green development plan, through institutional arrangements and institution building, create a stable political environment and guarantee mechanism for low-carbon development. For example, the carbon budget proposed in the Climate Change Act in the United Kingdom mandates the allocation of funds to the fiscal budget for carbon emission reduction. This is a solid foundation for typical low-carbon development.

Active use of taxation policies and proper use of tax revenues

A carbon tax on high-emissions and high-energy-consuming enterprises and subsidies on low-emissions and clean-energy technology companies can promote the optimization and upgrading of energy use structure and efficiency. However, tax-neutral measures are more conducive to the promotion of low-carbon development models. They can be used to return tax revenues back to the public to offset the negative impacts of tax revenues, or to reduce other distortionary taxes, and withdraw from some high-ranking companies mitigation and compensation, as well as funding and support for energy conservation and emission reductions. In order to reduce the cost of collection and guarantee effective collection, it can be expropriated from the production link based on the existing tax system.

Promotion of innovation in energy-saving technologies and R&D of low-carbon energies

Actively invest funds and technical R&D forces in technology R&D, aiming at existing energy products to further improve energy production processes, especially technological breakthroughs based on desulfurization technology; develop new energy, and vigorously develop clean renewable energy such as wind energy and solar energy. Clean new energy development as an opportunity will vigorously promote the development of new energy industries and low-carbon industries, promoting energy-saving buildings and new energy vehicles and the promotion of new energy power plants and various carbon sequestration and carbon-capture technology industries. Low-carbon environmental protection industry upgrades and development.

Practical implications 77

Establishment of carbon rights trading market and utilization of market incentives

Through establishing the carbon rights trading market in the region, the company will provide relevant market incentives for active emission reduction, allowing companies to take excess emission reduction targets for trading on the market and at the same time allowing individuals who have not completed emission reduction targets to get their missing emission reductions from the market. In the long run, carbon trading will encourage various enterprises to carry out corresponding technological innovations, which is a better way to achieve total reduction of emissions in society as a whole. Today, the carbon trading platform is limited to only a few regions. In the future, it needs to establish a global carbon rights trading platform so that more countries and enterprises can participate in transactions.

Cultivation of low-carbon lifestyle and construction of low-carbon society

A low-carbon lifestyle should be developed as a new trend in social norms by extensively advocating for the concept of low-carbon life, low-carbon transport, low-carbon consumption behavior, low-carbon construction and other low-carbon habits. We can start with simple things, like setting up a low-carbon community where the rational effect that integrates individual low-carbon practices into collective efforts can take form. In this way, the ultimate goal of a low-carbon society can be achieved where social norms of low-carbon production and low-carbon consumption will prevail. This will ensure greater definition and predictability of industrial development and investment in a low-carbon economy, reducing the use of fossil fuels and emission reduction barriers for certain industries.

Experience and implications of Chinese industrial development

The measures adopted by the developed countries to control and reduce carbon emissions will have profound implications for the future response to climate change in China. Its significance is not only reflected in the abstract macro development ideas; how to achieve specific effects through the implementation of various specific measures is even more critical.

China attaches great importance to the formulation of laws and regulations in response to climate change and has successively issued a series of guiding policy documents on energy conservation, emission reduction and climate change response. However, there is no single law or clause that can set carbon emission rules for companies or provide a budget for carbon emission reductions. If the relevant rules and regulations are only general proposals for future carbon and emission reduction approaches, they cannot be made clear on the key issues of low-carbon development. Whether it is for enterprisesor local governments that do not provide good incentives, then low-carbon development will eventually flow into form.

In terms of carbon-constrained fiscal and taxation systems, they are constrained by China’s existing systems and basic national conditions and have not yet reached the effective basis for carbon taxation, although the current collection of resource tax and sewage charges can temporarily impose unrestricted fiscal and tax constraints on carbon emissions. However, from the perspective of long-term carbon emission reductions, carbon taxation is an effective measure that can directly affect the effectiveness of emission reductions. China should gradually shift to a taxation system that uses carbon constraints as a direct target through resource tax reforms, and timely improve tax revenues, using channels, as far as possible, to invest these funds in various fields related to low carbon emission reduction to achieve a virtuous cycle of low-carbon development.

The development of the new energy industry has become a new industry growth pole in China, and many regions are competing to build factories in order to be the first beneficiaries of the development of new energy industries. This excessively popular development has revealed some irrationality. In many places, there are problems of decentralized and redundant construction. Even if many new energy products are clean and pollution-free, it does not mean that their manufacturing processes are as harmless as their products. Ignoring this issue will also bring about new development issues for carbon emission reduction constraints. Therefore, R&D and investment funds for energy conservation and emission reduction should be used as far as possible in the most favorable areas, and strict monitoring of pollution emissions should be conducted from each stage of production to application.

Carbon rights trading is another financial innovation under the market trading system. Although China has established carbon exchanges in Shanghai, Beijing and Tianjin, its trading mechanism and transaction types are far from being able to interface with international standards. The domestic transaction market is relatively closed and the transaction scale is limited. When participating in foreign carbon trading, domestic companies appear to be too passive, lacking the pricing power of carbon trading, and are mostly in a weak position in transactions. Therefore, we hope to achieve the ultimate goal of carbon emission reduction through carbon rights trading. Both domestic and foreign markets will face a series of practical problems.

The construction of a low-carbon society has not been popularized in China, but the dissemination of low-carbon ideas has long since ceased to be new in our country, but it is a new trend that is close to the traditional “saving” ideas. The true cultivation of a low-carbon lifestyle is inseparable from all aspects of coordination and cooperation. The regulation of daily behaviors such as low-carbon transportation, low-carbon buildings and low-carbon consumption requires the emergence of appropriate means of transport, housing and consumer goods, and then needs and wishes can be successfully completed. The public only depends on the will, but lacking physical supplies

Practical implications 79 that are actually available for selection means that the low-carbon lifestyle will become empty talk.

It is precisely because China is in a different stage of development to the developed countries that there are obvious differences in the level of economic development, industrial development and energy structure, etc. The successful experience of foreign countries may not be replicated at home. However, there are already many cities in the country that are taking the lead in combating climate change. Their existing developments have more practical reference values for other cities in China.

Low-carbon development of the second industry

As most cities in China are still in the process of industrialization, especially a group of old traditional industrial cities that have been in existence for a long time, their industrial development is based on the pattern of energy-intensive industries as the center, and China’s future economic development continues. It is impossible to stop the industrialization process. Therefore, under the premise of not affecting the progress of modernization and industrialization, the transition to low carbonization and cleanliness of the internal production of secondary industries is particularly important. The original energy-consumption industries can be turned to high-tech industries such as new energy, new materials, advanced equipment manufacturing, bio-pharmaceuticals and IT industries. These emerging industries have high technological content, low emissions and strong competitiveness. The advantages will help realize the optimization and upgrading of the industry and the low-carbon development of the industry.

Innovative development of the tertiary industry

In China, there are also cities where individual economic and social developments are close to the process of post-industrialization. Cities like Beijing and Shanghai have a higher proportion of tertiary production than that of secondary production, and they tend toward clean production within the secondary production. Next, the key issue is how to focus on realizing breakthrough development of the tertiary industry, achieving further optimization of the industrial structure and then feeding back the secondary production to provide more technical and financial support for the development. Therefore, the modern service industry, the modern financial industry and the creative culture industry in the tertiary industry have become the key development targets, replacing the original heavy chemical industry's development share, saving the city a lot of energy consumption and GHG emissions. While the urban environment is being cleaned and defended, it has also achieved a highly efficient and stable socio-economic development.

To sum up, combined with China’s basic national conditions, in dealing with climate change issues, more will start from the aspects of energy-savingemission reduction and fiscal and taxation policies. Because there is a big difference between China and developed countries in terms of carbon trading, the ability to participate in international carbon trading is relatively limited. In the implementation process of energy-saving and emission-reduction, taking into account that China’s coal-based energy structure, alternative energy sources and energy efficiency will not be significantly improved in the short term, it is highly relevant to China’s high energy consumption and high emissions. The industrial structure was mentioned on the surface and triggered a lot of attention. As a result, on the issue of China’s response to climate change, how to adjust the industrial structure with high energy consumption and high emissions has become an effective measure for realizing the purpose of mitigation, which not only ensures the restructuring of the three industries but is also reflected in the internal adjustment and upgrade of the secondary and tertiary industries. The heterogeneity among different regions in China is relatively large. The adjustment of industrial structure and the transformation of regional economy will require a longer period of transition and power conversion. But as long as we grasp its own characteristics, seize the opportunities for development and find suitable regional development, the model and development industry, whether it is the adjustment of industrial structure as a means to achieve the ultimate goal of energy conservation and emission reduction, or the premise of climate change mitigation, and the adjustment of the industrial structure for the purpose of economic adjustment, will achieve effective harvest.

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