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Mainland China

With a cumulative score of 2.4, Mainland China ranks number 1 among emerging markets and number 11 in the global ranking.

  • Emerging markets
  • Asia-Pacific

2.50 / 5

Power score


2.54 / 5

Transport score


1.98 / 5

Buildings score



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Low-carbon strategy

Net-zero goal and strategy

China has the goals to peak its carbon emissions before 2030 and reach net-zero before 2060.

Nationally Determined Contributions (NDC)

The government updated its NDC in December 2020 with new targets, including a 65% decline in GDP carbon intensity by 2030, compared with 2005. This is a minor adjustment of its 2017 target of a 60-65% decline.

Fossil fuel phase-out policy

President Xi Jinping announced in April 2021 that the country will start phasing down coal consumption from 2026-30. No explicit policy directive has been announced.

Power

Power policy

China launched its renewables portfolio standards in 2020, mandating power consumers and retailers to source a set share of clean energy. Retail liberalization now allows wind and solar assets in at least 25 of China’s 31 provinces to sell power directly to end users. The sale of coal-fired power, which still dominates the power system, has been liberalized in most of the country.

Power policies

Renewable energy auction
Feed-in Tariff
Import tax incentives
Net Metering
Renewable energy target
VAT incentives

Power prices and costs

In October 2020, China imposed caps on the lifetime ‘hours of generation’ for which subsidy will be paid for all existing and new renewables projects. BNEF categorizes it as a retroactive cut on subsidies, as it alters the earlier practice that subsidized the full actual generation.

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Power market

China’s power market is undergoing a series of changes that will impact both generation and retail. For renewable energy, generous subsidies that spurred rapid growth are coming to an end. It is still unclear whether policy makers will extend feed-in tariffs or deploy auctions for future projects. So far, decisions are made on an annual and province-by-province basis.

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Utility privatisation

Which segments of the power sector are open to private participation?


Generation
Transmission
Retail

Wholesale power market

Does the country have a wholesale power market?


Available
Not available

Doing business and barriers

There are no formal barriers to private sector participation in developing generation assets. However, private players face common disadvantages when it comes to obtaining local permits to construct, permits for grid connection, or obtaining cheap debt financing, while state-owned companies are treated preferentially.

Currency of PPAs

Are PPAs signed in or indexed to U.S. Dollars or Euro?


Available
Not available

Bilateral power contracts

Can a C&I (Commercial and Industrial) customer sign a long-term contract (PPA) for clean energy?


Available
Not available

Bilateral power contracts

Can a C&I (Commercial and Industrial) customer sign a long-term contract (PPA) for clean energy?


Available
Not available

Bilateral power contracts

Can a C&I (Commercial and Industrial) customer sign a long-term contract (PPA) for clean energy?


Available
Not available

Fossil fuel subsidies

Does the government influence the wholesale price of fossil fuel (used by thermal power plants) down through subsidies?


Available
Not available

Fossil fuel taxes

Does the government influence the wholesale price of fossil fuel (used by thermal power plants) up through taxes?


Available
Not available

Transport

EV market

China is a global leader in electric vehicles. It currently has a target for EVs to account for 20% of passenger vehicle sales by 2025 and build 4.8 million chargers by 2020. The government provides upfront purchase grants for EVs, although the level of support has been decreasing, and exempts EVs from purchase taxes. China uses fuel-economy standards to mandate fuel consumption limits for passenger cars. The first set of standards were issued in 2004.

EV policy

Transport policies

Electric vehicle target
Electric vehicle purchase grant or loan incentive
VAT incentives for EV
Import tax incentives for EV
EV charging infrastructure target
EV charging infrastructure support

Fuel economy standards

Does the country have a fuel economy standard in place?


Available
Not available

Buildings

Buildings market

In the building sector, China's central government encourages heating supplied using geothermal, biomass and solar. National building standards mandate energy efficiency levels for residential and public buildings as well as building heat energy consumption.

Together with local governments, it subsidizes the adoption of low-carbon heating. Most financial incentives for low carbon building improvements differ by region. In some, geothermal projects may receive a 50% rebate from the government. The country does not have a boiler scrappage scheme or incentive in place. Still, it does have broad policies encouraging boiler retrofits, emissions controls and energy efficiency improvements.

Energy performance standards

Are there minimum energy performance standards for buildings?


Available
Not available

Energy efficiency plan

Does the country have a national energy efficiency plan?


Available
Not available

Buildings policy

Buildings policies

Low-carbon heat target/roadmap
Tax credits
Boiler scrappage schemes
Heat pumps purchase grants/loans incentive
Ban on boilers: new build homes
Ban on boilers: all homes

Additional insights
from BNEF

Explore more detailed information on global commodity markets and the disruptive technologies driving the transition to a low-carbon economy.

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Climatescope 2021

Energy Transition Factbook

This marks the 10th anniversary of Climatescope, BNEF’s annual assessment of energy transition opportunities. For the first time, the project has expanded its scope to include activity not just in clean power but in the decarbonization of the transportation and buildings sectors.

Read the reportSee all reports

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