The news that the UK saw its warmest year on record in 2022 – and the prediction that this year could be even hotter – is yet another reminder of the need to enable a low-carbon future. A global response to climate change is urgently needed, especially since some recent studies have suggested that the planet could warm by 2°C by 2050 even if emissions are reduced in line with the recommendations of the Sixth Assessment Report by the UN Intergovernmental Panel on Climate Change (IPCC). This will have catastrophic consequences for the world as we know it.

It is clear that the entire global community must pull together and every nation must stretch itself to make the biggest contribution it can. That being the case, what potential is there for the UK and Chinese business communities to support and invest in each other as part of this effort?

The two countries are in quite different positions as they each face up to the challenges ahead. KPMG’s Net Zero Readiness Index – published in October 2021 and comparing the likelihood of 32 major economies reaching Net Zero by 2050 – places the UK at number two, while China is further back at number 20. This is because the two economies are at different stages of development, with China having to accelerate its industrialisation phase and at huge scale.

The UK, which accounts for under 1% of global emissions, has already enshrined in law its commitment to achieving Net Zero by 2050. To enable this, it has further set what the government describes as “the world’s most ambitious climate change target” of cutting emissions by 78% by 2035 compared to levels in 1990. This would take the UK more than three-quarters of the way towards hitting Net Zero by 2050. The UK’s major achievement to date is the decarbonisation of its power sector and the simultaneous shift to renewables. The carbon intensity of the power sector has fallen from 481g of CO2 per kWh in 2010, to 181g of CO2 per kWh in 2020; while renewables’ share of power generation has risen from around 7% to over 40% in the same period.

China, meanwhile, has a population about 25 times the size of the UK and accounts for around 30% of global carbon emissions. However, its carbon usage per head of population is around half that of the United States and is also considerably lower than that of some other Western economies. While its fossil fuel usage is still growing, China has pledged that this will peak in 2030 and then decline, with a Net Zero target of 2060. It is backing this up with real action – already being the world’s largest producer of renewable energy. In 2020, it had solar power capacity of 254,355 megawatts, far ahead of the US in second at 75,572, and it had triple the wind power installations of any other country too. China hopes that a quarter of its energy will be produced from non-fossil fuel sources by 2030 – and many analysts believe it may hit that target early.

It is clear that the UK and China have made considerable progress towards their net zero commitments. Below, we review some of the key progress that has been made by both countries in several areas of the fight against climate change.

China’s transition towards a zero-carbon future is critical for the global climate effort. And it is a transition which offers an immense opportunity for UK business — Andrew Seaton, CBBC Chief Executive

The urban energy transition

Climate change is forcing cities and regions around the world to face up to an inevitable energy transition. Nowhere is the need for this more evident than in what might be described as ‘Energy Cities’, whose economic fabric has for decades relied heavily upon growth in conventional thermal energy sources such as coal and oil. They are often among the most carbon-intensive regions of the world, and where the greatest savings and reductions can be made. The UK and China have several regions of this nature, and the ability to facilitate their transition to more sustainable models of economic activity is a priority for both local and central governments.

An April 2021 report by global renewable energy community REN21 found that 106 cities in the UK had set renewable energy targets or policies, and many have begun taking concrete measures. For example, in August 2021, Oxford launched its first Zero Emission Zone, which applies a variable daily charge to vehicles within the zone between the hours of 7am-7pm, depending on the emissions the vehicle produces.

In China, 25 cities had renewable energy targets or policies, covering an impressive 38% of the urban population in China. Notable policies include specific targets for hydrogen use in transport and fuel cells in Foshan, and bans on the use of fossil fuels in buildings in Handan and Taiyuan.

The role of tech

Technology is emerging as a key enabler in the path to net zero, with the tech sector playing a critical role both in CO2 emissions and in mitigating the long-term impact of climate change. The internet of things, 5G networks, big data, AI and quantum computing all have a critical role to play in addressing the global climate emergency.

It is not only the algorithms and devices of tech giants that are crucial to achieving net zero, but also the companies themselves. The data centres needed to power cloud storage and apps like Facebook and WeChat consume 1% of global electricity demand, according to the International Energy Agency, accounting for 0.3% of all global CO2 emissions. In January 2021, Tencent announced that it would work towards achieving carbon neutrality by 2060 in line with the Chinese government, emphasising measures such as using liquid cooling technology to bring power usage effectiveness down to 1.06 (the closer to one, the higher the efficiency) at one of its data centres in Guangdong.

Electric vehicles and clean transportation

As the world moves towards cleaner transport, the pressure is on for manufacturers to come up with solutions, and this is perhaps most obvious in the automotive market. The challenges that will need to be overcome to meet ambitious government targets are numerous. These are not just limited to how to harness new energy sources affordably and practically, but also include requirements for new materials, adaptation of the supply chain, product life cycle and even new ownership models.

China is well-positioned to meet these challenges. It is already home to nearly 50% of the world’s electric passenger vehicles, driven by subsidies of around RMB 14,400 (£1,600) for buyers (although those subsidies are now being phased out). Sales of new energy vehicles from homegrown Chinese brands such as Nio, XPeng and BYD have rebounded quickly following a dip during the pandemic in 2020.

Green finance

The UK’s finance sector has been well-positioned to grasp the multiple opportunities that China’s dynamic financial services sector has thrown open in recent years, where there has been a surge in activity around models of green finance and its use as an enabler of green growth.

This year saw China become the global leader in the issuance of green bonds as it rolled out funding to support clean and renewable infrastructure projects. In the first three months of 2021, Chinese issuers sold $15.7 billion (£11.3 billion) of bonds, almost four times higher than a year earlier, and exceeding the approximately $15 billion of bonds sold in the US.

The UK financial sector, for its part, has played a world-leading role in developing such instruments from their inception and is well-placed to work together with Chinese partners in pursuing common goals. Budget 2021 laid out ambitious commitments, including two Green Gilt issuances in 2021 totalling a minimum of £15 billion, which will be used to finance clean transportation, renewable energy, energy efficiency, pollution prevention and control, living and natural resources, and climate change adaptation.

Nature-based solutions

The world is facing the twin threats of climate change and biodiversity loss, and one cannot be solved without addressing the other. Agriculture, forestry, and other land use account for nearly a quarter of global greenhouse gas emissions. They also support global food security and millions of jobs. As such, it’s crucial that countries include nature-based solutions in their climate plans, and for businesses to do the same.

Recent solutions have ranged from the adoption of the latest Chinese technologies in the protection of native species, sustainable cities that incorporate agriculture into their infrastructure, and climate-positive spirits distilled using green hydrogen power.

Click here to read CBBC’s report, Targeting Net Zero: The Role of UK-China Business

The post How close are the UK and China to reaching Net Zero? appeared first on Focus - China Britain Business Council.

As cities evolve, regenerate and modernise into futuristic high-rise and smart-enabled urban landscapes, it’s vital that developers and urban planners do not lose sight of the importance of preserving a city’s unique cultural heritage. Shougang Park in Beijing’s Shijingshan District (pictured in the lead image above) is a prime example of urban regeneration in action.

The UK and China maintain a high degree of complementarity and collaboration within the built environment sector. China’s rapid rise to become a world leader in green energy, the 14th Five Year Plan’s drive for sustained green growth and urbanisation, as well as China’s climate change commitments – notably its recent 2060 Net Zero target goal – offer UK companies opportunities within the environmental, infrastructure, and energy sectors. UK companies are highly respected in the Chinese construction sector and offer a wide range of expertise in priority areas, including the design and construction of green buildings, urban renewal programmes, green finance, low-carbon design, and eco-city development.

The UK’s strategy for carbon neutrality in the urban environment is focused on:

• Industrial decarbonisation: Construction of greener buildings, including industrial factories, office buildings, and domestic homes; developing advanced R&D in carbon capture, usage, and storage; and an overall net reduction of carbon footprint throughout the ecosystem.
• Renewable energy: Adopting cleaner nuclear energy and pursuing advances in materials for power generation.
• Clean transportation: Accelerating the transition towards zero-emission vehicles, low carbon charging infrastructure, R&D in clean Hydrogen fuel cell technologies and alternative biofuels.

CBBC, together with the UK’s energy, environment and infrastructure sector, which includes Aedas, Arup, Atkins, BRE, Foster + Partners, Savills, Mott MacDonald, RIBA, Wood, Zaha Hadid and ZEDfactory – are champions of sustainable collaboration in this area.

CBBC’s partnerships and programmes with national and regional government, free trade zones, business parks, new cities and technological development clusters continue to offer opportunities for UK companies to plug into key projects and share their experience and track record in regenerating and shaping urban landscapes.

Several key Chinese landmarks and infrastructure projects carry the hallmark of UK excellence in design and construction whether you are admiring the Guangzhou Tower or travelling through either of Beijing’s international airports.

How the UK is supporting sustainable development throughout China’s economic development zones (EDZs)

China continues to accelerate the development of forward-thinking policies across the business environment to attract businesses that deploy green and zero-carbon methods. This is not only applicable to inward investment targets for zones, but also draws in expertise from the UK to ensure the development of low carbon and green solutions at the heart of their concept.

ZEDfactory has, at the project design phase, provided zero carbon and green architectural and product design solutions to a growing portfolio of clients in China, including the Datong Industrial Park, the Qinglingtan Industrial Park, and the Jingdezhen Wentao Cultural Exchange Centre, conceptualising solutions that ensure the workspaces and surrounding areas are cool and well air-conditioned during the hot summer months.

This has included orienting buildings in a way that reduces direct exposure to the sun and installation of photovoltaic hoods and roofs to help with ventilation. Other proposed solutions have included building parking lots designed to be inclusive for photovoltaic vehicles and bicycles, using breathable insulation on the walls, installing low-speed cooling fans, and integrating a smart natural ventilation system, A++ rated equipment and LED lighting.

UK companies leading innovations in green leisure and lifestyle

BREEAM is the world’s foremost and most widely applied environmental assessment method and rating system for buildings, with close to 600,000 buildings certified with BREEAM assessment ratings and over 2,310,000 registered for assessment since it was first launched by BRE in 1990.

As a globally recognised third-party certification, BREEAM not only encourages and supports the sustainable improvement of buildings but also helps investors understand their asset conditions and improve the resilience of assets in a more efficient way. At present, BREEAM certification has been applied to thousands of assets in several countries to benchmark, improve and certify its performance, and to demonstrate to the public the high standard of environmental and social governance of its enterprises. In China, high profile projects have included Club Med Joyview Qiandao Lake Resort and Ikea’s Jing’an Store. Ikea also decided to use the BREEAM sustainable building certification to advance the company’s efforts in championing sustainability, setting the following goals for the construction of their Jing’an Store to meet the BREEAM standard.

For example, by adopting BREEAM at the heart of its construction, the Club Med Joyview Qiandao Lake Resort has maximised the preservation of the site’s ecological characteristics while maintaining synergy between nature, architecture, and people.

Making an impact through internationally recognised education and qualifications

China has a rich talent pool of architects, and the Royal Institute of British Architects and the Chartered Institute of Building ensure that they have access to world-class professional development from the UK and enhanced career opportunities.

The Royal Institute of British Architects (RIBA) recently launched its International Talents Hub and is pursuing a comprehensive international strategic cooperation with the Lin Gang Special New Area in Shanghai: enriching partnerships that they have been developing across China; opening access to opportunities for aspiring architects; and aligning with China’s infrastructure and regional development policy goals.

Furthering the UK-China partnership

These examples highlight the UK’s track record as China’s long-term partner and highlight why our respective countries should continue to collaborate on regenerating urban landscapes; enhancing low carbon construction in the built environment; advancing green manufacturing; adopting renewable energy; and enabling access to first-class professional qualifications.

For further case studies and insights, please visit the links to access ‘In The Zone’ and ‘Targeting Net Zero’. These two reports present the role of UK-China business working in tandem to complement each other’s competitive advantages.

Whether you are a British or Chinese company working in the built environment sector, or an ETDZ seeking further collaboration with the UK, please contact our Industrial Economy sector leads Mark Xu (China) and James Brodie (UK).

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Rising energy costs are probably one of the most pressing issues in current UK politics. And while the spike in electricity and heating bills is probably temporary, electricity prices might well play a much larger role in economic growth in the coming years and decades. 

The main reason for this is climate change and the global race for net zero targets and technologies. A little-known feature of the transition from fossil fuels to renewable energies and carbon neutral industries is that a lot of the changes will require more, not less electricity. 

Consequently, cheap power might well be the most important variable determining not only the success of a clean energy transition, but also which countries are best placed to benefit from the opportunities of the net zero economy. 

This brief looks at the importance of electricity for businesses in the coming decades, in particular focusing on the prospects in both China and the UK. 

Background 

The net zero goals that were adopted at last year’s COP26 Summit in Glasgow will have far-reaching consequences, the most crucial of which might well be the growing importance of electricity costs for businesses. 

Take the steel industry for instance. Reducing carbon emissions – for example by switching from blast furnaces (burning iron ore) to environmentally friendlier electric arc furnaces (which use scrap metal) – would require up to five times the amount of electricity currently used. 

According to a study by McKinsey, electricity demand in the UK could jump from the current 300 terawatt hours to 590 terawatt hours. So, while overall energy consumption would drop by 34%, electricity consumption could rise by a staggering 97%. The International Energy Agency (IEA) comes to a similar conclusion, predicting that international industrial electricity consumption will more than double between 2020 and 2050.

In a globalised world, this also means that electricity costs will be a key factor for determining where green technologies and businesses can thrive – and where they can’t. In a world where China is seen as a ‘systemic competitor’ – according to the now widely accepted notion put forward in last year’s Integrated Review — the key metric could be electrification rather than computerisation. 

China’s rise and the role of cheap electricity 

Looking back at four decades of Reform and Opening Up, the ability to provide cheap electricity to businesses and households has been one of the major reasons for China’s rapid economic rise. According to the World Bank’s 2020 Ease of Doing Business report, electricity costs as a proportion of GDP per capita were almost zero. 

Based on one estimate, Chinese electricity costs for businesses in December 2021 were £0.078 per kWh – nearly three times less than in the UK, where the cost for the same amount of electricity was £0.216. Unsurprisingly, China has emerged as a global leader not just for attracting power-intensive industries, such as aluminium, but also green technologies like EVs and renewable energies. Domestically, China is set to sell six million EVs this year, roughly the same number sold last year … worldwide.

Average electricity costs for businesses in December 2021 (£/kWh)

China has also emerged as one of the world’s largest investors in green energy. Last year, its investment in green energy projects accounted for over 30% of global spending on renewable energy sources. By comparison, both Europe and the US spent far less, according to the International Energy Agency.

But despite being a poster child for renewable energy and still having one of the lowest electricity costs among major economies, China too is worried about the increasing dependency on cheap power. As Peng Wensheng of China International Capital Corporation (CICC) – a Chinese investment financial services company – recently wrote in Caixin, the energy crisis in Europe, and especially in its industrial powerhouse Germany, has underscored the importance of stable prices for China’s own manufacturing sector.

To be fair, Chinese electricity prices have remained remarkably stable compared to Europe. Prices for businesses in Beijing were around £0.099/kWh, only 27% higher than the national average from last December, according to data aggregator CEIC. 

China’s energy imports are also more diversified than Europe’s. Australia, China’s largest source of natural gas, only accounted for 25% of its external supply in 2021; Russia for only 5%. Europe, on the other hand, imported nearly a third of its gas from Russia. 

But even so, China faces its own dilemmas. First of all, Beijing also wants to achieve net zero. In a televised speech at the UN General Assembly in 2020, Chinese President Xi Jinping declared that China wants to reach a peak in greenhouse gas emissions by 2030 and carbon neutrality by 2060. These ‘double targets’ require a fundamental transformation in the country’s energy mix. 

In 2020, 64% of the country’s electricity still came from coal-firing plants. But that is not all. The second largest source – hydropower, accounting for roughly 17% of China’s power generation in 2020 – has proven to be problematic, too. Hotter, drier summers and weaker rainfall have forced hydropower stations to curb output, leading to several power cuts in southern and central China. 

Low water levels might also affect nuclear power plants — another green energy source. These plants rely on access to fresh water to cool their reactors. But with water getting scarcer during the summer months, it’s likely that they will also need to be shut down temporarily. France, for example, had to halt several reactors due to the current high temperature in adjacent rivers. China, too, wants to expand its nuclear power sector with at least three reactors planned near crucial waterways in southern China. But with the consequences of climate change becoming ever more apparent, these plans might have to be revised.

Sources of electricity in China (2019)

Additionally, China has undertaken several steps to reform its electricity pricing system which, in the short term, could increase the cost of electricity. Obviously, the main objective of the reform – which aims to replace the current fixed tariff-based system with a market-driven one – is to make energy costs more responsive to fluctuation in demand and to create incentives to save electricity and invest in energy-saving technologies. It also wants to make polluting energy sources such as coal more costly compared to renewable alternatives such as wind and solar. 

While the reform is both necessary and well-intended, it could pose a risk to China’s own net-zero timetable. The dilemma between market driven electricity prices and the growing demand for cheap and reliable electricity might force policy makers to make difficult choices. 

The CBBC View 

As the consequences of climate change become clear, the need to provide stable and affordable electricity will be a major challenge for policymakers around the globe. Countries like China, that have managed to attract businesses with cheap electricity costs, face similar challenges as those with more expensive costs. 

Some effects of global warming, such as hotter and drier summers, have also exposed the vulnerabilities of power sources relying on sufficient water supply, notably hydro and nuclear power. Expanding water-neutral renewable energy sources and expanding grid and storage technologies which allow electricity to be delivered across long distances will be one of the top priorities for governments with large industries. 

Cheap electricity has helped China become a leader in the expansion of renewable energies and green technologies, but the extreme reliance on coal and water power poses its own risks for the country’s race towards net zero. Fixing these problems will be crucial, not just for the green transformation of the Chinese economy, but also for the chance for other industrialised economies to meet their own targets.

If you are a British company working in the energy sector, call +44 (0)20 7802 2000 or email enquiries@cbbc.org now to find out how CBBC’s market research and analysis services could help your business thrive in China.

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China — as the world’s second-largest economy — will play a crucial role in the negotiations. The UK and Chinese governments have set themselves ambitious targets to reach “net zero” by 2050 and 2060 respectively. 

With less than two months to go before the critical climate change conference, COP26 President-Designate (and British MP) Alok Sharma recently completed a series of meetings with Special Representative for Climate Change Affairs of China, Xie Zhenhua, in Tianjin, emphasising the need to take urgent action to keep the global rise in temperature at or below 1.5℃. They discussed President Xi Jinping’s commitment to achieving peak emissions before 2030 and reducing the country’s use of coal, as well as how China can build on its position as the largest investor in renewable energy and the largest domestic market for zero-emission vehicles. 

But what concrete steps have both countries taken to achieve this in the run-up to COP26? As an ongoing CBBC webinar series explores, actions taken fall into a number of categories, including urban energy transition and green finance.

The urban energy transition

Climate change is forcing cities and regions around the world to face up to an inevitable energy transition. Nowhere is the need for this more evident than in what might be described as ‘Energy Cities’, whose economic fabric has for decades relied heavily upon growth in conventional thermal energy sources such as coal and oil. They are often among the most carbon-intensive regions of the world, and where the greatest savings and reductions can be made. The UK and China have several regions of this nature, and the ability to facilitate their transition to more sustainable models of economic activity is a priority for both local and central government.

An April 2021 report by global renewable energy community REN21 found that 106 cities in the UK had set renewable energy targets or policies, and many have begun taking concrete measures. For example, in August 2021, Oxford launched its first Zero Emission Zone, which applies a variable daily charge to vehicles within the zone between the hours of 7am-7pm, depending on the emissions the vehicle produces.

In China, 25 cities had renewable energy targets or policies, covering an impressive 38% of the urban population in China. Notable policies include specific targets for hydrogen use in transport and fuel cells in Foshan, and bans on the use of fossil fuels in buildings in Handan and Taiyuan.

The role of tech

Technology is emerging as a key enabler in the path to net zero, with the tech sector playing a critical role both in CO2 emissions and in mitigating the long-term impact of climate change. The internet of things, 5G networks, big data, AI and quantum computing all have a critical role to play in addressing the global climate emergency.

It is not only the algorithms and devices of tech giants that are crucial to achieving net zero, but also the companies themselves. The data centres needed to power cloud storage and apps like Facebook and WeChat consume 1% of global electricity demand, according to the International Energy Agency, accounting for 0.3% of all global CO2 emissions. In January 2021, Tencent announced that it would work towards achieving carbon neutrality by 2060 in line with the Chinese government, emphasising measures such as using liquid cooling technology to bring power usage effectiveness down to 1.06 (the closer to one, the higher the efficiency) at one of its data centres in Guangdong.

The data centres needed to power cloud storage and apps like Facebook and WeChat consume 1% of global electricity demand, according to the International Energy Agency, accounting for 0.3% of all global CO2 emissions

Electric vehicles and clean transportation

As the world moves towards cleaner transport, the pressure is on for manufacturers to come up with solutions, and this is perhaps most obvious in the automotive market. The challenges that will need to be overcome to meet ambitious government targets are numerous. These are not just limited to how to harness new energy sources affordably and practically, but also include requirements for new materials, adaptation of the supply chain, product life cycle and even new ownership models.

China is well-positioned to meet these challenges. It is already home to nearly 50% of the world’s electric passenger vehicles, driven by subsidies of around RMB 14,400 (£1,600) for buyers (although those subsidies are set to be phased out by 2022). Sales of new energy vehicles from homegrown Chinese brands such as Nio, XPeng and BYD have rebounded quickly following a dip during the pandemic in 2020.

Green finance

The UK’s finance sector has been well-positioned to grasp the multiple opportunities that China’s dynamic financial services sector has thrown open in recent years, where there has been a surge in activity around models of green finance and its use as an enabler of green growth.

This year saw China become the global leader in the issuance of green bonds as it rolled out funding to support clean and renewable infrastructure projects. In the first three months of 2021, Chinese issuers sold $15.7 billion (£11.3 billion) of bonds, almost four times higher than a year earlier, and exceeding the approximately $15 billion of bonds sold in the US.

The UK financial sector, for its part, has played a world leading role in developing such instruments from their inception, and is well placed to work together with Chinese partners in pursing common goals. Budget 2021 laid out ambitions commitments, including two Green Gilt issuances in 2021 totalling a minimum of £15 billion, which will be used to finance clean transportation, renewable energy, energy efficiency, pollution prevention and control, living and natural resources, and climate change adaptation.

Nature-based solutions

The world is facing the twin threats of climate change and biodiversity loss, and one cannot be solved without addressing the other. Agriculture, forestry, and other land use account for nearly a quarter of global greenhouse gas emissions. They also support global food security and millions of jobs. As such, it’s crucial that countries include nature-based solutions in their climate plans, and for businesses to do the same.

Recent solutions have ranged from the adoption of the latest Chinese technologies in the protection of native species, sustainable cities that incorporate agriculture into their infrastructure, and climate-positive spirits distilled using green hydrogen power.

Targeting Net Zero Webinar Series

CBBC is delighted to present a webinar series in the run-up to COP26, exploring the role that UK and Chinese businesses can play in support of carbon neutrality targets, with a particular focus on multilateral cooperation.

The webinar series is ongoing throughout September and October, with the next session, Adaptation and Resilience: UK-China Tech Collaboration and the Path to Net Zero, taking place on 22 September.

Click here to find out more about the webinars and to register to attend. 

The post 5 ways UK and China businesses can help meet COP26 targets appeared first on Focus - China Britain Business Council.

China surprised the world this week with the announcement that it would decarbonise its economy by 2060. In his address to the United Nations General Assembly, president Xi Jinping pledged to deliver carbon neutrality within the next 40 years. As the world’s biggest carbon emitter, and contributor of around one third of the global carbon dioxide emissions that cause global warming, the significance of the commitment cannot be underestimated.

If achieved, it could pave the way for other nations to set more concrete environmental ambitions, essential to tackling climate change. However, the specifics of how this might be achieved are hazy. Some critics rightly argue the horizon is too distant and point out that coal power in China has rebounded in recent years.

A panel of international Chinese policy experts share their opinions on the feasibility of this goal.

Sean Kidney, CEO, Climate Bonds Initiative

The carbon neutrality pledge could potentially be a watershed moment for China and the world’s actions to avoid a climate catastrophe.  But it is also an enormous challenge for an economy the size of China’s, which is significantly dependent on the high-emitting and hard-to-abate sectors.

This means China only has 30 years to go from its emissions peak to net-zero emissions – a timeline far shorter than any other major economy to achieve this kind of transition. For this ambitious target to be achieved, breakthroughs in environmental governance, technology, economic planning and financial market regulations would be expected.

China’s local governments, large corporations and financial institutions would need to begin to consider taking the lead in planning for carbon neutrality goals. This means that the local governments and large companies will need to progressively reduce exposure to brown assets and practices as they increase capex towards, and adoption of, greener modes of operation.

The pledge will give impetus to international cooperation on climate change and green finance, especially between China and the EU.

Barbara Finamore, senior attorney and Asia senior strategic director at the Natural Resources Defense Council, a US environmental advocacy group

China’s aim of reaching carbon neutrality by 2060, if achieved, would take us a giant step closer to avoiding the most catastrophic impacts of climate change. To get there, the country must begin now to rapidly accelerate its transition away from fossil fuels to a cleaner, more efficient, and more innovative economic development model. It will require massive investments, difficult policy reforms, and strong political will to overcome resistance from powerful vested interests and ensure a just transition for affected workers and communities.

It will require massive investments, difficult policy reforms, and strong political will to overcome resistance from powerful vested interests

But it can be done. Detailed studies by Chinese researchers provide a compelling pathway for China to phase out coal completely by mid-century in a way that balances multiple needs – starting with an immediate halt to new construction of conventional coal plants.

Other studies show how expanding non-fossil energy can reliably meet rising energy demand while saving money. China is already considering a ban on fossil fuel cars and has ambitious long-term plans in place for development of potentially transformative technologies such as hydrogen and offshore wind.

The benefits to China in terms of cleaner air, energy security, and economic sustainability are enormous. So are the opportunities for businesses and investors who can help the country achieve its goals.  China’s welcome announcement should encourage other countries to strengthen their climate ambitions, while its actions can serve as a model for other countries looking to achieve deep decarbonisation.

Jonathan Watts, journalist and author of ‘When a Billion Chinese Jump’

I’m hugely encouraged by the announcement which appears to go considerably further than any previous commitment by China. This is a politically constructive and globally responsible step that breathes new life into the Paris Climate Agreement, keeps the 1.5C goal [to limit the rise of global temperatures to 1.5C above pre-industrial levels] alive (just) and gives COP26 more chance of success. The timing is astute and will hopefully make it easier for other countries to follow. But the devil will be in the detail. How will China achieve this? Will it scale back overseas coal investment and can it go still further? I hope so. Climate stability needs more ambition from everyone. Now the world needs the US to step up and that will depend on November’s election.

The opportunities for businesses and investors who can help the country achieve its goals are enormous

Li Shuo, senior climate and energy policy adviser for Greenpeace East Asia

When it comes to long-term decarbonisation, the most important question is what is necessary, not what is feasible. Climate science tells us that, to stay within safe temperature range, the world must achieve net zero around the middle of this century. So far, few countries in the world dare to even consider bridging the gulf between science and politics. The significance of Mr Xi’s pledge for carbon neutrality should be viewed in this light.

For the first time, a major emitter is willing to embrace the daunting challenges of going completely carbon free. The scale of transformation will be unprecedented. No wonder there is no concrete plan – nothing like this has ever been done in human history. The audacious move should serve as a starting point to seriously plan for the climate imperative.

The most immediate step for China should be to halt its ongoing coal expansion and to phase out its existing coal fleets soon. If the factory of the world is willing to consider zero emissions, there is no reason other countries, large or small, cannot do it.

Jennifer Turner, director of the Woodrow Wilson Center’s China Environment Forum think-tank

Despite lacking details, President Xi’s 2060 carbon neutral declaration is encouraging, especially in a year when scientists say climate disruption is becoming locked in. If Mr Xi’s moonshot target is backed by concrete and aggressive action it could spark renewed global action on climate, similar to how a US-China bilateral agreement united the world behind the Paris climate talks.

In recent years, China has reached most of the low-hanging, low-carbon fruit, thus, it is critical for its 14th Five-Year-Plan to develop clean energy infrastructure and technology investments in ways that fast track deeper decarbonisation. Mr Xi’s administration has used coercive environmentalism to mandate new clean technologies and investment, such as the goal to phase out internal combustion engine vehicles by 2050. With rules requiring electric vehicle production and purchases, China is driving up clean energy vehicle markets domestically and around the world.

Instead of locking in decades of high-carbon energy overseas, China as a carbon neutral leader could export its own clean energy model, perhaps even challenging other countries to also go low carbon in their overseas investments.

With contributions from Ruyi Li, research assistant at the China Environment Forum

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