China’s Quest for Energy Efficiency: Analyzing the Challenges and Opportunities

China’s Goal to Reduce Energy Intensity of Economy by 2024

Beijing aims to achieve a 2.4% reduction in energy intensity this year, according to a report by Bloomberg citing a government document. However, despite the goal of reducing energy consumption per unit of GDP, energy use in industry and homes is expected to increase overall. This is due to the growth of the service sector as the economy recovers.

The National Development and Reform Commission stated in the document that efficiency improvements are one of the strategies proposed to reduce China’s energy intensity. The 13.5% reduction target for energy intensity also includes an emissions intensity reduction target of 18%. However, meeting these targets may be difficult, leading to potential changes in tracking and reduction methods. In 2022, Beijing altered the rules for tracking energy consumption, such as excluding wind and solar capacity as well as resources converted into products.

These changes could impact the achievement of energy and emissions intensity reduction targets in the near future until the end of the five-year planning period. The Ministry of Industry and Information Technology developed an action plan two years ago to reduce energy intensity by 13.5% between 2021 and 2025 through implementing new technologies, standards, and financial services. However, this year’s target is less ambitious compared to previous goals set by Beijing. Last year, China aimed for a 2% reduction in energy consumption per unit of GDP but failed to meet it for the first time in 20 years.

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