China Shuns Energy Use Target to Focus on Securing Fuel Supply

(Bloomberg) -- China declined to set a new hard target for energy use and will focus on securing fuel supplies as the world’s biggest oil, gas and coal importer navigates unprecedented tumult in global markets.

Instead of an annual goal for energy consumption per unit of GDP, one of the nation’s favored metrics for progress on climate action, China will give itself more flexibility to meet targets previously set for 2025 to help support growth.

The nation will focus on staying on track for its five-year goal of a 13.5% reduction in the metric from 2021 to 2025, Premier Li Keqiang said Saturday at the opening of the National People’s Congress. 

Read more: Chinese Premier Li Sets 2022 GDP, Inflation Targets: Full Report

Li highlighted the need to ensure food and energy security, including stepping up drilling and mining for oil, gas and coal and improving national stockpiles. He also said prices will be kept generally stable, even as global costs surge on supply concerns after Russia’s invasion of Ukraine.

China’s congress comes as the nation aims to balance the need for stable energy supplies to power economic growth with its longer-term ambitions to curtail greenhouse gas emissions and help slow the worst impacts of climate change. 

The country wants to “retain an appropriate level of flexibility, both providing reasonable leeway for energy consumption to ensure the steady performance of the economy and urging local governments to maintain their energy conservation efforts,” the National Development and Reform Commission said in a separate report.

While China has faced criticism for not doing more to cut emissions faster, authorities face pressure to ensure there’s no repeat of coal shortages that led to widespread power curtailments last year and also need to handle a surge in oil prices triggered by the Ukraine war.

China usually lays out an annual energy intensity target, though skipped a specific goal in 2020 at height of the country’s fight against the pandemic. 

Last year’s aim for a 3% reduction faced criticism in September for undermining economic growth after some provinces ordered factories to temporarily shut so they could hit the target. Li said China’s government will shift from a focus on energy intensity to carbon emissions intensity, and exclude newly installed renewable power from energy consumption accounting.

Read more: Huge Chinese Desert Projects Will Power Next Wave of Wind, Solar

Li also insisted China isn’t turning its back on clean energy, a sector in which Chinese companies are world-leading manufacturers. 

The country will continue to develop massive wind and solar power bases in desert regions and improve electricity grids. There will be an advance in major hydropower projects in the lower reaches of the Yarlung Zangbo River, while additional nuclear power capacity will be added in a safe and orderly manner, the NDRC said.

In a report last month, China’s government said it had reduced energy intensity by 2.7% in 2021, while it decreased carbon emissions per unit of GDP by 3.8%. Total energy consumption rose 5.2%.

(Updates with details throughout.)

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