While the uproar caused by The Guardian’s (rather misleading) coverage of the leaked Danish text has drowned out some of the clamor about what China’s recent pledge to reduce its carbon intensity 40-45% by 2020, the amount of concern and confusion about the target was clear at a side-event put on by NRDC that I attended yesterday.  Confusion, and sometimes information that is misleading, and occasionally just plain wrong, is also prevalent in the media and the US policy world, where some groups are repeatedly claiming that China’s commitment is not substantial enough, or that it represents business as usual, not a new commitment.

To me (and many people I consider experts on the topic), this reflexive reaction that anything China does is either not meaningful or will be harmful to the U.S. is one of the most frustrating things that occurs in the U.S. as a whole, and in Congress particularly, and I was sad to see that a fair amount of this lack of knowledge and confusion carried over to Copenhagen.  At the event I was at yesterday, Dr. Lu Xuedu of China’s Office of Global Environmental Afairs and Dr. Mark Levine of Lawrence Berkeley National Laboratory were part of panel of experts talking about how China’s actions fit into the global picture.  Levine focused particularly on the carbon intensity target, while Lu spoke about China’s efforts in general.  Both speakers emphasized just how significant China’s actions have been to date and just how ambitious the new carbon intensity target really is.  Unfortunately, there was only time for Lu to answer two questions and the two which were asked were incredibly basic, which made me think that a post about what China’s targets really mean could be helpful: the more criticism China gets for its carbon intensity target, the more difficult it becomes to lock in their pledge, and including this pledge in an agreement from Copenhagen is essential.

Carbon intensity is the amount of carbon emissions per unit of economic output (generally in terms of GDP).  The number depends on end-use energy efficiency, the share of economic output generated by heavy energy-intensive industry, the mix of primary energy sources (ie, how much is coal and how much is low-carbon), and income levels and consumer behavior. China’s target of reducing 40-45% by 2020 requires annual reductions of 4%, but since the target is based on GDP, the amount of emission reduction required changes as GDP changes: lower GDP requires higher reductions in emissions to achieve the same reduction in carbon intensity, which is hard to achieve because less growth means less new (and therefore more efficient) equipment in the system.

One easy way of looking at this (used by William Chandler of the Carnegie Endowment* in his new web commentary on the topic is to look at the ratio of the growth in energy use to the growth of the economy, or the “energy-GDP elasticity In a typical developing country, this number is between 1.0 and 1.5, meaning energy use somewhere between doubles and triples for each doubling of GDP.  To meet its targets, China will need to achieve an elasticity of 0.5 if GDP grows at 8% annually, or as low as 0.33 if GDP only grows at 6%.  Clearly, this is a very ambitious and unusual target for a developing country, and it reflects how afraid China is of the consequences of climate change. Dr. Lu also mentioned last night that China has done six months of research in academic institutions on the topic and that the range of 40-45% was the absolute highest range academics thought were possible.

The other main complaint is that China’s target will only represent business as usual (BAU).  This claim generally refers to the IEA’s World Energy Outlook 2009, which creates a reference scenario based on current energy legislation.  In the case of China, this scenario includes their very ambitious target of reducing energy intensity (energy use per unit of GDP) 20% from 2005 levels by 2010.  China is on track to meet this target, but meeting it has required them to undertake some very extreme measures that Bill goes as far describing as draconian, and which certainly would not have been possible in the U.S. or many other countries.  One key element of their success involved shutting down tens of thousands of factories and power plants because they were inefficient.   China’s top-down planning members mean the state officials set targets that local and provincial leaders must meet, and many local leaders feel that the energy intensity goals have dragged down local economies.  Because of this, it’s not yet clear that these policies will be continued in the next 5-year plan, which should be announced this winter.  The central government may prevail, but it’s not a forgone conclusion and shouldn’t be considered the status quo.

China would have to take dramatic actions to meet its carbon intensity pledge and the parties at Copenhagen would do well to treat its pledge as the ambitious target that it is, rather than bashing it for not going far enough.