No. 5 January 1994

Energy and Environment in China - a new UNEP collaborative activity

The India Pilot Study reported elsewhere in this issue was the first major UNEP-sponsored national study of energy and the environment. A second study, similar in scale, was initiated in June 1993 with the signing of an agreement between UNEP and the National Environmental Protection Agency (NEPA) of the People's Republic of China. The UNEP Centre participates directly in the project, Incorporation of Environmental Considerations in Energy Planning in the People's Republic of China, and Centre staff have already undertaken two missions to China to finalise the project work plan and to provide training on the energy-environment planning techniques which could be used in the project.

The "China project" along with that in India is regarded as a key activity in UNEP's energy programme. The project has been under preparation for more than a year. The Centre has been working very closely with UNEP HQ in the whole preparatory phase and two joint missions have been undertaken.

The project objectives follow UNEP's general mandate in the energy area, which is to promote integration of environmental criteria in national energy policy and planning. Specific aims are to strengthen national and regional institutional capacity in the area of energy environmental analysis and to promote policies that reduce energy-related environmental emissions.

The project will provide a broad overview of the national energy development situation and develop alternative national energy scenarios, including analysis of implementation options and establishment of a plan of action. This national activity will in part be based on more detailed case studies for Beijing City and Guangxi Zhuang Autonomous Region. Specific plans for these two areas will also be developed in close collaboration with the local authorities and institutions.

Training courses

Through formal and informal training, small workshops and exchange visits of involved scientists the Centre will contribute to strengthening institutional capabilities on the analysis of energy related environmental issues. The first Group In-service Training Programme for 40 technical staff members of the central and regional teams took place in Beijing from 2 to 14 December 1993.

The training course was focused on establishing a common methodology for collection, analysis, and interpretation of data on the emissions and impacts associated with energy process and technologies. Technical support from UNEP Centre was provided to the course through presentations and training on the Environmental Database (EDB) developed by the Stockholm Environmental Institute-Boston Center (SEI-B) with partial funding from UNEP. EDB is intended to be used in the project not only as a pre-loaded database of environmental coefficients, but also as structured tool for analysts to manage the specific data which will be generated in the frame of the project.

Planning models and methods

The energy-environment situation in China is a complex issue. In spite of the fact that the country is endowed with a very large amount of energy resources, it suffers from severe energy shortages due to capacity constraints in the energy production, transformation and distribution systems. This situation is aggravated by the fact that China's energy supply and end-use system is fairly inefficient. At the same time, the country faces severe environmental damages related to energy production and use. The project aims to enhance and complement available methodologies and planning models as background tools. This will facilitate the identification and analysis of alternative development scenarios which explore how the energy requirements needed to secure national development aims can be met with minimal negative environmental impacts.

New challenges

Implementation of identified energy options is one of the key issues to be tackled by the project. The "open door"policy and the introduction of partial market mechanisms into the centrally-planned economic system have created a more favourable context for increased attention to environmental issues and implementation of mitigation measures. In fact, the traditional bureaucratic-authoritative approach is being replaced by decentralized structures allowing more decision-making power to local governments and production units.

The campaign-exhortation policy encourages broad public participation, including research and academic centres, in the decision process, and market-oriented reforms have expanded the opportunities and incentives for a more positive attitude toward the environment.

At the same time however, the economic reforms have given rise to new obstacles concerning the implementation of environmentally sound energy strategies and policies. Decentralization policies have brought about ineffective implementation of environmental policies due mainly to obstacles in bureaucratic systems. Similarly, conflicts of interest between institutions and utilities hamper the adoption of environmental regulations and directives. On the other hand, the dual structure of the Chinese economy as result of "planning-dominated and market-complemented"economic strategy has created a serious distortion of energy prices. The "dual price system" adopted by the government as part of its efforts to rationalize energy prices has stimulated more energy production rather than rationalizing energy use. This pricing policy has also encouraged a rapid growth of inefficient and environmentally negative small-scale rural energy producers.

These are some examples of the issues the project intends to address. The identification of relevant options will be complemented by the analysis of concrete decision situations. The analysis will identify relevant decision levels and actors involved in the decision process, and specify conflicting objectives and strategies. All these factors play a decisive role in the formulation of long-term energy policy for China.

The project started in June 1993, with the National Environment Protection Agency (NEPA) as the supporting organization. The project implementation organization comprises a National Coordination Committee with representatives from the most important national committees and institutions, a Management Committee with the directly involved institutions, and a Project Office to coordinate and plan the many detailed project activities. Beijing city and Guangxi Zhuang Autonomous Region have been selected for detailed case studies, as they represent a number of key energy-environment issues, such as urban air pollution, acidification, etc.

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