China’s Short March to Climate Neutrality

In July of this year, the Sydney Morning Herald reported that China had apparently already fulfilled its commitments under the Paris Climate Agreement to hit peak emissions by 2030 and its emission levels were now falling. The fact that the world’s global leader in carbon dioxide emissions is setting a new standard for environmentally friendly energy use, especially considering all the bad news about climate protection, is a real bombshell for climate policy, particularly as China is still in the catch-up phase of modernization and industrialization.

In the 1990s, China was laconic about the immense ecological cost of its breath-taking economic boom: “We’ll do it like the West, first we’ll get rich, then we’ll clean up” was the country’s maxim. Yet this idea soon faded from political discourse as it became clear that there would not be much left to “clean up” after an ecological disaster. Moreover, a clean environment and sustainability became prominent political demands of the new middle classes, leading to the realization that ecologically friendly modernization would have to be integral to China’s modernization plans.

The Renewables Boom

Despite mounting pressure on governments to take action, specific climate policies are facing increasing political resistance globally, often being drained of momentum by lobby groups or debates over fair distribution. China, however, has been moving in the opposite direction over the past decade and a half, as illustrated in particular by its successful expansion of renewable energy sources.

The speed of China’s transition to renewable resources is breath-taking. The country’s investments in clean energy have increased by 40 percent year-on-year to reach 890 million US dollars in 2023, almost equalling total global investment in fossil fuels. With regard to solar photovoltaics, China is a world leader, installing more solar panel modules in 2023 than the rest of the world combined. In addition to this rapid expansion of solar power, China has also invested heavily in wind power, last year installing 65 percent of the world’s total new wind turbines.

In June 2024, it was announced that state-owned power-generator manufacturer Dongfang Electric Corporation had completed the installation of the world’s first 18-megawatt wind turbine in the Guangdong Province, which can provide power for up to 36,000 homes. Four of the top five global wind turbine manufacturing firms are based in China and investment in wind energy technology has led to impressive technological advancements and economies of scale. These have lowered the cost of installing a wind turbine in China to one fifth of the investment needed to install one in the US.

China is now also pioneering the transition to electric transportation. Thanks to government support, the country owns 95 percent of the world’s electric buses, with close to 80 percent of buses now in service running on electricity, a notable climb from 16 percent in 2016. Several of China’s largest cities now operate bus fleets that are 100-percent electric.

China has ensured that its transition to an ‘eco-civilization’ is a driving force of modernization that determines the course of all societal subsystems.

China is also far ahead of the rest of the world when it comes to high-speed trains, boasting a larger high-speed rail network than the rest of the world combined, which has already grown to over 40,000 kilometres since its introduction in 2008.

Chinese electric cars make up over 60 percent of global sales, an increase from 0.1 percent in 2012. Chinese production of electric vehicles grew 36 percent from 2023 to 2024. And new regulations are being introduced to effectively phase out fossil-fuel-powered vehicles in the coming years. Electric vehicles account for 50 percent of new vehicle registrations in China, a figure that is rising rapidly.

Ecological Civilization

This successful restructuring of China’s development programme is rooted in Chinese policy and planning processes, which are fundamentally different from their German counterparts. One decisive factor in this regard is the long-term nature of planning, which is not subject to short-term profit maximization or the changing tides of voter opinion. That said, contrary to popular opinion, the speed of this process cannot be attributed to a “lack of democracy”. It is more complex: National Congress reports and five-year plans that define the direction of development are part of long communication processes that both precede and follow decision-making. From initial target setting to the formulation of concrete policies, there is a circular discussion process which helps to further define and specify goals.

This experimental approach to policymaking is characterized by overarching goals and local “experimental zones” set up by the central government in Beijing, in which a variety of tools are tested and different models are developed. If successful, these models are emulated in other regions in order to assess if these policy options can be applied nationwide. To date, 572 experimental zones and 240 so-called innovation centres have been planned.

Although environmental and climate issues were also discussed in China in previous eras, discourse around socio-ecological transformation only really took off after 2007, when the creation of an “ecological civilization” was officially formulated for the first time at the Communist Party of China’s Seventeenth National Congress. The Eighteenth National Congress in 2012 then defined this “ecological civilization” as the core objective of Chinese modernization and made it a central task of national government policy, placing it alongside economic, political, social, and cultural modernization (so-called “five-in-one” modernization).

In 2017, the Nineteenth National Congress declared that bridging the contradiction between prosperity and sustainable development required the beginning of a “new era” or, in other words, a new development strategy. One year later, the Ministry of Ecology and Environment was established and granted considerably more power than its predecessor, the Ministry of Environmental Protection. In short, it took just ten years to recalibrate coordination at the systemic level. In this way, China has ensured that its transition to an “eco-civilization” is a driving force of modernization that determines the course of all societal subsystems.

China’s economic model has specific features that support this process, such as state-owned enterprises and state-owned banks. The country’s enormous investments are largely made by state-owned banks and many key projects are carried out by state-owned enterprises. Even the editors of the Financial Times have acknowledged that China’s state-owned enterprises, often characterized as lumbering giants, play a decisive role in accelerating the introduction of clean technologies.

China’s eco-civilization programme is extremely technology- and growth-centred. While this approach may have been successful during the first phase of the transition, in the next phase there is no avoiding a rethink of lifestyles and consumption patterns.

Financial markets, too, are strategically wired towards managing this transformation. D´espite sharing some key features with global capital markets, Chinese capital markets function quite differently. This does not mean that profits or returns on financial assets do not play a role in them. Profit is necessary but is not the primary goal of economic activity, nor is a return on financial assets. Rather, it is economic policy that defines the crucial targets, such as the development of certain technologies and sectors.

Long-term strategic planning instruments such as the country’s five-year plans create the trust needed to guide investments while offering investors safety. They also enable coordinated action: 15 years ago, for instance, when there were no electric cars on China’s roads, all new underground garages and parking lots in major cities had to be equipped with charging stations.

These long-term plans also make it easier to align the various reform programmes and strategic goals. For example, the conservation and restoration of natural habitats played a key role in combating poverty, in particular through the creation of jobs in the environmental sector. Since 2013, almost five million hectares of farmland in China’s impoverished regions have been restored to forest or grassland. In the process, 1.1 million poor people have found employment as foresters and tens of thousands of reforestation teams and cooperatives have been established that combat poverty.

Contradictions and Tensions

Despite its successes, the Chinese approach to ecological transformation is not without its contradictions, nor is it a friction-free process. So far, competing interests, while frequently surfacing locally, have not openly clashed yet.

China’s “eco-civilization” seems to have created more winners than losers. Even workforces in former coal regions appear to have been absorbed smoothly by other sectors. However, the last few years of the transition were accompanied by moderate economic growth that cushioned the costs of this process. It remains to be seen whether the political system will be able to sustain or build a basic consensus around the country’s socio-ecological transition in the face of increasing struggles over economic justice. Small and weak non-governmental organizations are hardly able to lend bottom-up momentum to this discourse on the country’s ecological transition and to effectively push for their interests.

In addition, China’s eco-civilization programme is extremely technology- and growth-centred. While this approach may have been successful during the first phase of the transition that was focused on the restructuring of energy and transportation systems, in the next phase there is no avoiding a rethink of lifestyles and consumption patterns. While the latter have become the subject of a gradually evolving debate — albeit one that remains confined to small pockets of society — both government and mainstream society continue to adhere to the traditional, i.e. consumerist rationale of growth-driven prosperity. That will not suffice. Therefore, the next challenge China will need to face concerns its own model of development: can it bridge the gap between society’s relationship with nature and society’s status quo?

This article first appeared in nd.Aktuell in collaboration with the Rosa Luxemburg Foundation. Translated by Eve Richens and Lyam Bittar for Gegensatz Translation Collective.