Renewable energy is the way forward Bloomberg/Getty

China’s era of dark, satanic mills, churning out “stuff” for the rest of the world, is coming to a close.

Instead, the world’s second largest economy wants to accelerate its shift away from heavy, coal-hungry industry, towards a greener future.

This will involve a big switch towards renewable energy and increasing consumption of produce domestically.


That’s the main message from the Chinese government’s draft 13th five-year plan, unveiled in Beijing on 5 March and expected to be adopted this week.

The “new normal” will involve a shift to moderate rather than dramatic economic growth, based more on consumption than exports.

Growth not consumption

“This is a big shift in how China is thinking about its economy,” said Kate Gordon of the Paulson Institute, a sustainable energy think-tank based in Chicago, Illinois, at a press conference last week. “It’s an attempt to decouple economic growth from energy consumption.”

Central to the planned move away from heavy industry is a nationwide effort to reduce dependence on coal, the dirtiest fuel in terms of carbon emissions.

Indeed, China’s carbon emissions may have already peaked, according to a new report by economist Lord Stern to be published this week.

Much of the impetus for change has come from the Chinese public in response to record levels of coal-related air pollution in recent years in some major cities.

Coal dependency

Figures released last week by the Chinese government showed that it still relies on coal for 64 per cent of its total energy consumption, but this is steadily falling, dropping by 3.7 per cent last year compared with 2014.

At the same time its installation of solar and wind energy is soaring by record levels, rising 74 and 34 per cent respectively last year compared with the previous year.

And it looks as if China is serious about continuing to phase out coal. It plans to introduce caps on coal consumption in its 10 most polluted cities, according to Barbara Finamore, the Asia director of the Natural Resources Defense Council in Washington DC. Capping targets have already been set by a further 20 provinces and 30 cities.

The government has set up a new body to ensure those targets are met. “It’s called the Regional Coal Consumption Reduction and Substitution Working Group, and it will evaluate the coal reduction plans of each region,” says Finamore. “They can impose penalties on plants that fail to meet the targets.”

Shrinking industry

Already, says Gordon, many of China’s heavy industries are beginning to contract as demand from abroad for manufactured goods shrinks. “China’s steel sector is currently working at just 66 per cent of its capacity,” she says.

The new five-year plan includes $23 billion in funding to give workers in older industries new skills suited to modern “sunrise” sectors such as biotechnology, aviation and intelligent manufacturing.

“What’s exciting is that China has an integrated approach which tackles all these problems – from air quality to climate change – together rather than separately,” says Gordon. “The key will be to show a model to the rest of the world for how to switch to sustainable economic development.”

Read more: China’s climate comeback: How the top polluter is cleaning up