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China Energy Transition Status Report 2021

An overview on some of the highlights of China’s year in energy transition for an international audience.

The last 12 months have been a momentous period for China’s energy and climate policy. While President Xi’s 2060 carbon neutral announcement represented a watershed moment in the worldwide energy transition, in many ways it builds upon earlier policies, technology trends, and international cooperation on the topic of low-carbon, sustainable development. Most importantly, it represents a concrete vision for realizing the Chinese concept of an Ecological Civilization, including a revolution in energy production and consumption.

Until 2020, China had already taken many steps towards revolutionizing energy production and consumption. However, in some respects the role of markets, clean energy, and demand response have remained constrained within a narrow niche. Many industry observers and official think tanks had continued to consider coal as the sine qua non of China’s energy system. They could not envision a revolution, even one planned and organized at the highest levels, as changing that. Increasingly, that has begun to change, as analysts and industry players have begun to recognize that, through steady progress on clean energy integration, China’s energy revolution can and should ultimately lead to carbon neutrality—though virtually all acknowledge the difficulty of the task.

The purpose of this report is to summarize for an international audience some selected aspects of the energy transition underway in China. The links to various official statistics and policy documents may also serve as a useful reference for international scholars and others with an interest in China’s energy situation. The report is the second in a series published by the Sino-German Energy Transition, a component within the larger Sino- German Energy Partnership, a part of the long-term cooperation between the China National Energy Administration and the German Federal Ministry of Economic Affairs and Energy. The project is implemented by
GIZ, the German Energy Agency (dena), and Agora Energiewende on the German side, and by the Electric Power Planning and Engineering Institute (EPPEI), the China Southern Grid Energy Development Research Institute (CSG EDRI), and the China Academy of Sciences Institute of Applied Ecology (CAS IAE) on the Chinese side. The views, data, and other contents of this report have been complied by the Sino-German Energy Transition Project at GIZ, and therefore any views expressed in the report are solely those of the authors, and have not been reviewed or approved by the project’s partners.