Has China reached peak emissions?
It hopes to de-link its carbon emissions from economic growth
IN LATE 2022 the Chinese government dropped its strict controls over the spread of covid-19. That was good for the economy. Factories started humming again and more cars returned to the roads. For the same reasons, it was bad for the climate. In 2023 China’s carbon-dioxide emissions surged by 4.7%, to a record 12.6bn tonnes. China accounted for over a third of the world’s emissions last year.
Now, though, China’s emissions are falling. In March they declined by 3% year on year, the first drop in 14 months, according to an analysis published by Carbon Brief, a specialist news website. Preliminary data show that China’s emissions probably fell in April, too. It is early days, but if this trend continues, the country’s emissions may never again rise to the levels they did in 2023. In other words, they would have peaked.
That is enough to cheer environmentalists. But the data also hint at another promising development: the direct relationship between China’s economic growth and its emissions may be loosening. In the past, lower emissions were usually a result of slower growth (see chart). This year, though, China’s growth has edged up as emissions have come down.
One reason for optimism is that China’s property sector has become a less important part of the economy. New-home prices have fallen for 11 months in a row. There is a glut of unsold inventory. So developers are building less, reducing demand for carbon-intensive materials. In March production of cement fell by 22% year on year. Steel production was down by 8%.
Meanwhile, other kinds of economic activity are increasingly powered by clean electricity. Last year China installed almost 300 gigawatts (GW) of wind and solar capacity (for comparison, Britain’s total power capacity is less than 100GW). This allows more production to happen with fewer emissions. China’s workers are travelling around in greener ways, too. The country accounted for more than half of global sales of electric vehicles last year.
China can continue to make its economic growth less dirty by rolling out more green technology. Over half of its energy still comes from burning coal. Under an “optimistic” scenario put forward by the China Photovoltaic Industry Association, the country would add another 280GW of solar power to its grid every year until 2030. New wind-power capacity would increase by 50-60GW per year over the same period.
But for China to completely decouple its economic growth from its emissions, it would probably have to undergo even more radical changes. Take the British economy, which is 80% larger today than it was in 1990, yet produces half as much carbon dioxide. Cleaner energy sources certainly helped. But Britain also now uses much less electricity. That is the result of an economic shift away from power-hungry manufacturing and towards services and consumption.
China’s ruler, Xi Jinping, doesn’t appear interested in such a transition. In recent years he has directed government support to manufacturing rather than to services or consumption. China’s electricity demand has been going up. Mr Xi sees manufacturing as not just a way to expand the economy, but as a form of security. He wants to make Western countries more reliant on Chinese factories. If that means China’s economic growth remains reliant on carbon-emitting industries, so be it. ■