BEIJING -
Official figures from the National Development and
Reform Commission (NDRC) show that China will fail
to meet its target of reducing energy consumption
per unit of gross domestic product (GDP) by 4%
this year.
China has set a unit
energy-consumption reduction target of 20% for the
five-year period from 2006 to 2010. To attain this
goal, annual reduction should be about 4% during
the five-year period. The goal is aimed at guiding
China's social and economic
development, but the country
is already well behind schedule.
In fact,
China witnessed an increase of 0.8% in its energy
consumption per unit of GDP in the first half of
the year and indices for major pollutants have
continued to rise.
The central government
has put the blame for the sluggish start to its
"green GDP" pilot projects in 10 provinces and
municipalities squarely on the local governments.
Many local authorities have resisted fiercely, and
some of them have even asked for permission to
abandon the scheme.
Under the green GDP
scheme, the cost of environmental degradation is
highlighted alongside the economic growth figures
of specific regions.
"A lack of economic
motives is the fundamental reason for the local
governments' weakness in reducing energy
consumption and improving environmental
protection," said Chen Qingtai, vice director of
the Economic Committee under the Chinese People's
Political Consultative Conference.
"No
enterprises or local governments are taking pains
to transform their methods of achieving economic
growth or taking risks to improve technological
innovation," said Chen.
Qin Min, the
manager of a textile plant in southern China, is a
case in point. He insists he wants to equip all
the machines in his factory with energy-efficient
converters but is waiting for the government to
introduce financial incentives.
"I want to
change but the cost will be too high and whether
or not, or by how much, I can benefit from a tax
reduction is unclear," he said.
In a
national meeting mapping out economic policies for
2007 held last week, China's central authorities
recognized that more efforts were needed to
improve energy efficiency in the country and
issued a stark warning to uncooperative
local-government cadres.
Among the eight
leading economic tasks it listed for next year,
the central government put energy efficiency and
environmental protection third, behind
macroeconomic control and agriculture.
All
officials "must reach a common understanding and
make their utmost effort to achieve practical
improvement in reducing energy consumption and
pollution", read a statement issued at the
conclusion of the Central Economic Work Conference
two weeks ago.
According to an
energy-efficiency plan circulated by the State
Council to governments at all levels in August, an
industrial structure that promotes energy
efficiency will be created, which places emphasis
on technological innovation, supervision of local
departments, and favorable tax policies.
Some steps in this direction have been
taken this year. In 2006, 1,008 enterprises in
nine major energy-consuming industries have
participated in the energy-efficiency program
launched by the central government. The objective
of the project is to save energy equivalent to 100
million tons of coal.
In June, China for
the first time published a list of provincial
regions in order of energy efficiency to name and
shame the worst offenders.
In September,
China abolished export-tax rebates on coal,
natural gas and some primary wood products while
reducing tax rebates on steel, cement, textile and
non-ferrous metals.
"Administrative
measures may be effective sometimes in encouraging
energy saving and environmental protection, but it
is by no means a panacea," said Chen Qingtai.
"Only when the government policies take
effect through market forces will every player's
efforts in pursuing profits fall in line with
energy saving and environmental protection,
otherwise achieving our energy-efficiency target
will be impossible," he said.
A list of
energy-saving products is being drawn up by the
central government, the use of which will result
in tax preferences. Higher export taxes will be
imposed to dissuade companies from exporting goods
that involve a high consumption of energy and
cause serious pollution.
"For China's
energy-saving project, 2007 will be very critical,
because the time has come for those energy-saving
measures, governmental or non-governmental, to
prove effective," according to the Energy Research
Institute of the NDRC.
