Source:
https://scmp.com/business/article/3173020/climate-change-few-chinese-manufacturers-have-plans-curb-emissions-despite
Business

Climate change: few Chinese manufacturers have plans to curb emissions despite broad carbon footprint awareness

  • Only 43 per cent of industrial companies in China have taken action to tackle greenhouse gas emissions, according to a TUV Rheinland survey
  • Nearly two thirds of respondents said they were aware of the scale of their emissions and believe China’s carbon neutral goal will impact business
An aerial view of a coal-fired power plant in Hanchuan, Hubei province, on October 13, 2021. Photo: Getty Images

Less than half of industrial companies in China have taken action to cut greenhouse gas emissions, despite most saying the scale of their current emissions will affect business prospects, according to a survey conducted by TUV Rheinland.

While some 72 per cent of 650 respondents said they know the sources and scale of their greenhouse gas emissions, only 43 per cent have either set up a team or worked with third party professionals to tackle the issue, according to the Germany-based industry standards certification provider.

Moreover, although 73 per cent of respondents said China’s goal to become carbon neutral by 2060 will have a “moderate” or “relatively big” impact on their businesses, just 12 per cent have specific decarbonisation targets and timetables. Some 27 per cent said they were working on one.

The vast majority of the respondents surveyed in February are manufacturers, mostly of automobiles, electronic and electrical parts, and consumer goods in China’s eastern and southern coastal provinces.

The survey results reflect the lack of a detailed regulatory framework on how China will achieve its ambitious 2060 target, and the time lag between becoming aware of the problem and investing the time and resources to build teams to take action, said Fallight Xu, a TUV regional officer responsible for sustainability services.

“The most significant barrier is the lack of adequate resources and an external driving force – policies and regulations,” he said. “The enterprises need time to design systems and build teams [to] understand the implications of carbon neutrality, set targets, screen pathways and build capacity.”

Many companies are worried about the reputational risks of publishing decarbonisation road maps while detailed industry emission regulations and targets remain absent, he noted.

In Europe, which leads the world on decarbonisation, the European Commission has enacted a climate law with a legally binding target for all member states to enact regulations to achieve net zero greenhouse gas emissions by 2050.

It includes measures to track progress every five years, and an intermediate target of reducing net greenhouse gas emissions by at least 55 per cent by 2030, compared with 1990 levels.

China installs record number of solar panels on rooftops in race for carbon neutrality

01:05

China installs record number of solar panels on rooftops in race for carbon neutrality

In 2020, Beijing set out “dual control” targets for carbon emissions to peak before 2030 and to reach carbon neutrality three decades later.

The government has not announced any interim targets for the reduction of the absolute level of carbon emissions at the industry level, although Beijing has set energy intensity benchmarks to be achieved by 2025 for 17 energy-intensive industries to help drive decarbonisation.

It has also imposed annually-adjusted carbon intensity quotas on coal power generators – the nation’s biggest carbon dioxide emitters – via a carbon emission permits trading system.

Still, over 60 per cent of the surveyed companies said they would be willing to invest just 1 to 5 per cent of their net profits in the next decade to achieve net zero emissions, while 20 per cent were inclined to put in 6 to 10 per cent. A tenth of the respondents were prepared to set aside more than 10 per cent.

Globally, some 69 per cent of 166 heavy carbon emitters studied by investor-led group Climate Action 100+ have made commitments to achieve net zero emissions by 2050 or sooner, up from 52 per cent a year ago.

However, 83 per cent of the companies have not set medium-term emission reduction targets aligned with the 2015 Paris Agreement that seeks to limit global warming to 1.5 degrees Celsius by 2100 over pre-industrial levels, it said last week.

Only 42 per cent of the firms have included the emissions of their supply chain partners in their net zero ambitions, while just 5 per cent have committed to align their capital expenditure plans with their long term decarbonisation targets.

“Companies are setting emissions reduction targets but don’t have the strategies to deliver them,” the group said. “Only 17 per cent of [the] companies have robust, quantified decarbonisation strategies.”