Powering the New Champions

Chinese leader outlines strategy to cut car emissions

Dalian, People’s Republic of China, 7 September 2007 – On the second day of the Inaugural Annual Meeting of the New Champions, at a blue-ribbon panel to discuss means of combating climate change, Zhang Xiaoqiang, Vice-Chairman, National Development and Reform Commission, People's Republic of China, outlined a future strategy to cut car emissions in China.

While acknowledging that fast-growing Chinese demand showed no signs of flagging, Zhang said the government is likely to develop market-based incentives to encourage the purchase of cars that would use less energy. "The government shouldn’t simply block the demand of citizens to buy cars. But we can set up a framework to encourage people to use smaller, more energy-efficient cars, perhaps by using different tax rates. I think we’re at an early stage, and in the future we will try to do this much more effectively."

The same strategy would likely be implemented at the provincial level, added Zhang, who acknowledged that the actual implementation of ambitious central government goals on the environment has sometimes fallen short in practice. Zhang said local officials have become more aware of the need to increase energy efficiency, but they must balance the need for energy conservation with the goal of strong economic growth. Also, the start-up costs of energy-saving projects may appear high to provincial governments. To deal with the issue, he said, the central government "must set up a framework to provide incentives to use energy saving and clean technology."

"If we use incentives, a combination of high tariffs and low taxes [for wasteful versus energy-efficient practices], then more people will be mobilized to develop this kind of business," Zhang said.

As for generating cleaner energy, he said, "The top priority is how to develop clean coal technology and use it on a large scale."

Zhang said hydropower and nuclear power are also both promising as a means of producing cleaner energy in China in the future.

Other panellists, while stressing the importance of pursuing a broad portfolio of clean energy technologies worldwide, echoed the point that, in the near term, developing cleaner-burning coal should be an important objective for those seeking to reduce carbon emissions. In both China and the US, coal is cheap and abundant, said Eileen Claussen, President, Pew Center on Global Climate Change, USA. "The reality is, we’re going to burn a lot of coal. So it’s imperative that we find ways to capture those emissions and store them."

Connie Hedegaard, Minister for the Environment of Denmark and Minister for Nordic Cooperation, highlighted European successes in employing political regulations to help cut emissions. "Europe has not been afraid of increasing efficiency standards for CO₂ emissions from vehicles. There are taxes on gasoline; there’s a heavy tax on cars. It’s a way of steering demand patterns to actually make people demand cars that have better mileage," she said.

The Inaugural Annual Meeting of the New Champions is hosted in close partnership with the government of the People’s Republic of China represented by the National Development and Reform Commission, the NDRC.

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