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China’s 12th Five Year Plan is Formed 4/7/2011

China's five year planLast month, China’s newest Five Year Plan (FYP) was developed at the Annual Sessions of China’s National People’s Congress. At the center of the 12th FYP is possibly their most ambitious energy goal to date. The new plan calls for a reduction of energy intensity by 16 percent over the next five years. As the goal is quite bold, it is possible considering that during the previous FYP, China managed to reduce energy by 20 percent.

Other goals of the FYP include a plan to reduce pollution and reduce China’s dependency on fossil fuels. China is aiming to reduce carbon dioxide emissions by 17 percent and to increase the use of non-fossil fuels from 8 percent (current state) to 11.4 percent in 5 years.

When it comes to implementation, China has decided to encourage development and foreign investment in industries that will increase their ability to move towards these green goals. They will be executing programs to support growth in the high-end manufacturing industries such as clean energy, various service industries and environmental protection.

Of course, there are supporters and opponents of the newest FYP. Supporters of the plan include environmental protection groups and clean energy groups who are encouraged by China’s step towards a greener country. Some opponents say however, that the plan could be too ambitious and that some of the other goals included in the plan may be conflicting with their green initiatives; such as the target to build upwards of 40 new airports over the next five years.

Ambitious or not, achievable or not, changes are on their way for foreign investors and where different incentives will be placed in the upcoming years.

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China Energy: An Investment in the Future 10/26/2010

Looking to invest in China? Market analysts say renewable energy is where to plant your dollars….and watch them grow.

As you all know, China has a whole lot of people, 1.33 Billion to be exact (I could be more exact and say 1,338,612,968 as an estimate for July 2010) but let’s not be picky. These people all use and consume energy on a daily basis. China has, in fact, recently become the world’s biggest energy consumer as of July 2010, as reported by the International Energy Agency. China however, consumes about five times less energy per capita than the United States.

None the less, if China (and the U.S. for that matter) continue at such a pace, it will only lead to more of an energy crisis than there already is. Hence, the need for renewable, clean and green energy sources is growing. In efforts to fuel this need China has set a goal to have 15% of its energy use be non-fossil-energy by 2020; wind and solar are predicted to be the largest part of this surge.

According to Marketwatch, in 2002 China consumed 2.2 billion tones of oil “equivalent” or 19.5% of the world’s total energy consumption. Investment in clean energy in China however was $34.6 billion in 2009 (up almost 150% from 2005). China’s wind power market alone has been estimated to be worth 1.5 trillion RMB (or roughly 225 Billion USD) by the year 2020. (source: Energy Research Institute of the National Development and Reform Commission.)

Investing in clean energy could see high returns, both for your pocket book and the sustainability of our earth.

Some useful resources:

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China Energy: Goals for 2010 10/8/2010

"China Energy" Goals for 2010According to the China Daily Newspaper, China has made great strides to meet the energy consumption goals the Central Government has set for 2010. The mission is to cut energy use per unit of GDP by 20 percent by the end of 2010. The Minister of Industry and Information Technology of China, Li Yizhong said on Friday that they are on track to hit the mark in efforts to become a more green country.

This goal could affect where your company chooses to invest or start a business. Provinces heavy in highly consumptive and pollutant industries like steel, iron and cement production are being affected more than other regions. Areas with more of a balanced landscape of industries are having an easier time reducing overall energy consumption.

Some of the struggling provinces have received orders to shut down certain factories after the government ordered for more than 2,000 closures of inefficient, highly polluting factories nationwide in August.  According to Bloomberg, some specifically challenged cities have faced blackouts affecting businesses, homes, traffic signals and hospitals as the local governments strain to meet the proposed energy goals. The Central Government has been halting these outages as quickly as possible to encourage regions to meet the goal the right way.

China has also reduced its energy consumption and helped improve environmental conditions through the closure of some small thermal power plants and other energy-hogging projects and by slowing the growth of additional highly consumptive and pollutant projects.


Guardian: China Electricity Blackouts

China Daily: China Energy Consumption Down

Bloomberg: Energy Intensity Targets

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