By LI JUNFENG, CHEN JI, QI YUE, WANG TIAN & ZHANG MINSI

China and U.S. Unite for a Greener World

By LI JUNFENG, CHEN JI, QI YUE, WANG TIAN & ZHANG MINSI

Mayor Eric Garcetti of Los Angeles, host city of the First Session of the U.S.-China Climate-Smart/Low-Carbon Cities Summit, hands over the hosting rights for the next summit to Vice Mayor Li Shixiang of Beijing.

THE heads of state of China and the U.S. issued on September 25, 2015 a joint statement on climate change, so following up on their last joint announcement in September 2014 during the APEC meeting. The joint presidential statement reaffirmed a common stance and action in three respects: the Paris Climate Change Conference, countermeasures to climate change, and strengthening cooperation.

Provide Political Impetus and Pragmatic Solutions for a Successful Paris Conference

By virtue of the major roles that China and the U.S. play in multilateral climate change negotiations, they respectively represent the core interests of developing and developed countries. Their previous joint statement in late 2014 propelled the COP 20 in Lima, which adopted in its resolution the principle, as raised in the statement, of “common but differentiated responsibilities.” A key factor in narrowing disparities among all parties, the statement to some degree salvaged the conference. The latest China-U.S. joint statement sustained this approach by providing political impetus for the Paris Conference and contributing to it more practical compromises and solutions. The China-U.S. presidential joint announcement on climate change touched upon the most crucial aspects of negotiations in Paris. Dealing with the issues of differentiation, ambition, and financial support was perceived as vital for a successful Paris Conference. Parties’views diverged widely on these issues, but the China-U.S. joint statement, as well as other important bilateral announcements, including from China-France, Germany-Brazil, China-EU, etc., provided key “bridging” proposals whereby Parties reached consensus.

First was the consensus in the Paris Outcome on ways of operationalizing the principle of “common but differentiated responsibilities.” Given that the world has experienced evolution of its economic and social development as well as of GHG emissions in recent decades, there has been long debate on whether this bifurcation is still applicable. The core and focus of the negotiations hinged on how this principle would be reflected in relevant elements of the agreement. Developed countries, in contrast to developing countries, were keen to get rid of the bifur-cation, i.e. Annex I (developed countries) and non-Annex I (developing countries). On the other hand, the majority of developing countries insist on this differentiation approach. To address this issue, therefore, the China-U.S. joint statement suggested that the two countries “further consider that differentiation should be reflected in relevant elements of the agreement in an appropriate manner,” so raising the possibility of a multilateral process of resolving the problem.

Second was enhancing transparency of parties’ actions and support. This was an important feature of the new resolution of the Paris Conference, and served as a basis for building mutual trust and confidence in international cooperation. The various reporting and review mechanisms established under the UNFCCC were conducive to all parties’ understanding of one another’s vision and progress. They thus facilitated implementation of the outcome of the UNFCCC as well as parties’ commitments and actions. Both China and the U.S. advocated inclusion in the Paris Outcome of an enhanced transparency system and beefed-up reporting on support for developing countries; also that the system allows flexibility for developing countries, according to their capacities and the allencompassing concerns of these parties.

Third was the installation of a mechanism for intensifying countries’ efforts. There is consensus on controlling the global average temperature rise to within two degrees Celsius by the end of this century. However, research explicitly shows that the commitments all parties have so far made are not sufficient to realize this goal, and that there is a risk of further deterioration which will cause greater loss and damage. Therefore, action to narrow this discrepancy is of major concern to all. However, notable divergences remain in mechanisms related to “intensifying efforts.” The joint statement explicitly stated that the two countries should “move in the direction of greater ambition over time.” This will, to some extent, encourage all parties to reach a consensus on this issue.

Fourth was finding a common expression for the longterm goal from countries that hold different stances on it. Some believe that the long-term goal should be quantified according to the two degree Celsius limit, such as a target for quantified emission reductions in 2050, or a zero emissions target, carbon-neutral goal. Others are more concerned about the indeterminacy and poor maneuverability of the quantified target. But most parties agree that the low-carbon development mode is crucial to controlling the global temperature. The joint statement echoes this trend. It reaffirms the two degrees Celsius temperature limit, and at the same time emphasizes the need for global lowcarbon transformation during the course of this century. The two sides found appropriate wording to address both parties’ acknowledgement of this view.

Last but not least was building consensus on financial support – a constant focus throughout international climate change negotiations. Developed countries’ commitments to jointly mobilize US $100 billion each year by 2020 should be put into practice. All parties concerned have for some time held different understandings of climate finance. In the joint statement, China and the U.S. expressed their views in this regard: “Climate finance would come from a wide variety of sources, public and private, bilateral and multilateral, including alternative sources of finance.” The consensus the two countries have reached may motivate all parties to exchange ideas and build a consensus in Paris on forming an equitable and effective finance mechanism under the post-2020 international climate change regime.

GHG Emissions Reduction Coupled with Domestic Sustainable Development

For China and the U.S., controlling greenhouse gas emissions is not just a global responsibility in the comprehensive effort to tackle climate change; it is also a requirement for realizing sustainable development which will maintain, or even enhance their global competitiveness. In their joint statement, the two countries also set down measures and actions to realize INDCs. This signified their resolution and confidence in this regard, as well as their sustainable development strategies based on GHG emission reductions.

The U.S. reaffirmed its commitments to finalizing the Clean Power Plan and fuel efficiency standards for heavyduty vehicles, reducing methane and HFC emissions, and increasing efficiency standards in the building sector. China, in its quest to advance ecological progress, raised such detailed measures as anticipating peak emissions, and concrete policy measures to increase the proportion of nonfossil fuel use and forest stock volume.

As regards non-fossil fuel, China will promote green power deployment, giving priority to dispatching renewable power, and high-efficiency, low-emission fossil fuel power. This has been a consistent policy since issuance of the Renewable Energy Law in 2005. In recent years there has been a surge of renewable energy in China, due to preferential policies on prices, finance and tax, and wind power farm bidding. Along with the scale-up of electricity-grid connected renewable energy, however, many wind power farms in northern China are non-operational.

Prioritizing the dispatch of renewable power is also a key measure underscored in a document released last April by the CPC Central Committee and the State Council on building an ecological civilization. Promoting the dispatch of energy-saving power and giving priority to dispatching renewable power and fossil fuel power according to unit energy consumption and pollutant emissions will optimize the market environment for developing non-fossil fuel. It will also better guarantee China’s realization of its commitment to confine the proportion of non-fossil power to 15 percent of the total by 2020 and to 20 percent of the total by 2030.

China’s special representative for climate change affairs Xie Zhenhua said in his speech on the eve of the seventh China-U.S. Strategic and Economic Dialogue (S&ED) last June that China and the U.S. could set an example for South-North cooperation.

China first announced in the joint statement its plan to start a national emissions trading system in 2017. After several years of efforts, the carbon trading market has indeed made progress. Through carbon emission trading pilots, China has positively explored trading mechanism designs, market operations, and capability building. It has tested the implementation of a carbon trading mechanism in different areas with different industries, energy structures, and extents of socioeconomic development. The China National Development and Reform Commission has also released guidelines to 24 major industries on methods of calculating and reporting greenhouse gas emissions, and organizing local governments to report on and verify historical GHG emission data. NDRC has moreover researched key elements such as trading coverage, transaction volume, quota allocation, trading rules, and products, and also developed and constructed a national carbon emission trading registry system. These policies, since their successful implementation and progress, have established a solid foundation for a national carbon trading market. Despite challenges from such quarters as the legal system, quota allocations, and in transposing pilot experience to centrally controlled SOE participation, China has made solemn commitments. They signify China’s resolve to control emissions by means of the market through applying market-based approaches.

Practical Cooperation to Accelerate Global Green Development

Since setting up the China-U.S. Climate Change Working Group in April 2013, China and the U.S. have successively established cooperation in eight key fields. They include heavy-duty and other vehicle emissions, smart grid, carbon capture and storage, construction and industrial energy efficiency, greenhouse gas data collection and management, a climate change and sustainable forestry initiative, climate smart/low-carbon city and boiler efficiency, and fuel conversion. Both countries are thus progressing towards solid and orderly cooperation.

The joint statement reviewed important and solid achievements and announced actions to help other developing countries tackle climate change, advocate lowcarbon overseas investment, and strengthen cooperation among local governments. Its aim is to elevate bilateral climate change cooperation to a new height that promotes global green, low-carbon development.

In supporting other developing countries, the U.S. reaffirmed its US $3 billion pledge to the Green Climate Fund. China announced its initiative of a RMB 20 billion fund towards setting up the China South-South Climate Cooperation Fund. The two countries’ funds will vitalize international cooperation on global climate change and bolster developing countries’ transition to low-carbon, so enhancing climate change resilience.

On the matter of promoting low-carbon overseas investment, the U.S. is the major player in current multilateral international financial institutions. China, meanwhile, is initiator of emerging multilateral financial organizations such as the Asian Infrastructure Investment Bank (AIIB) and the BRICS New Development Bank. Both countries wholeheartedly support low-carbon technologies and expanding climate resilience, and promise to give preference to low-carbon areas in investments of public funds. This signifies the mainstreaming of climate change into the global financial system. It will send a clear signal for private investment, so paving the way for development of global green, low-carbon finance.

As regards regional cooperation, the joint statement affirmed the progress that local governments and enterprises of the two countries have made in addressing climate change. It expressed appreciation for the outcome of the First Session of the U.S.-China Climate-Smart/Low-Carbon Cities Summit, held in Los Angeles on September 15-16, 2015. It also supported the actions listed in the U.S.-China Climate Leaders Declaration, signed by 24 localities of the two countries. The U.S. and China moreover encouraged enterprises of the two countries’ active participation, emphasizing the important role that businesses can play in promoting low-carbon development. Multiple levels of cooperation in various sectors will help both to raise domestic awareness, promote the course of global cooperation, and encourage wider collaboration in addressing this global challenge that all human beings face.

As the respectively largest developing and developed countries, China and the U.S. are playing key roles in many other international multilateral mechanisms. To tackle the global climate change challenge, both will strengthen dialogues and cooperation in such international organizations as the G20, Montreal Protocol, International Civil Aviation Organization, International Maritime Organization, WTO, and the Clean Energy Ministerial. They will thus facilitate progress of all issues relating to climate change.

LI JUNFENG is director of National Center for Climate Change Strategy and International Cooperation; CHEN JI, QI YUE, WANG TIAN and ZHANG MINSI are researchers at the center.