China Needs $389 Billion a Year for Climate Pledge, Study SaysBloomberg News
China is aiming to get 20% of energy from non-fossil fuels
Domestic funds have played important role so far, study says
China needs to invest an average of about 2.5 trillion yuan ($389 billion) a year to achieve its goal of peak carbon emissions by 2030, a study found.
To reach that target, investments in climate change need to grow by more than 4 percent each year to a peak of 2.56 trillion yuan in 2020, or an amount equivalent to 1.79 percent of China’s estimated economic output at that time, according to the study by the Research Center for Climate and Energy Finance under the Beijing-based Central University of Finance and Economics.
Climate finance is in focus at the moment as United Nations climate negotiations continue in Paris. In June, China pledged to cut carbon emissions per unit of economic output by as much as 65 percent from 2005 levels by 2030 and to get 20 percent of its energy from non-fossil fuels.
Investment would stabilize at about 2.5 trillion yuan annually in the decade through 2030 before declining to 1.5 trillion yuan by 2050 as the spending allows China to benefit from lower costs of clean technology and large-scale application, the study wrote.
China’s climate financing will come from public funds from developed countries, national financial funding, international and domestic carbon markets, charities, traditional financial markets and direct investment through enterprises, according to the study.
"Domestic public funds have played an irreplaceable role in leveraging private capital," the study said. "Conventional financial markets are the biggest potential capital
China led in renewables last year with investments of $89.5 billion, accounting for almost one out of every three dollars spent on clean energy in the world, according to Bloomberg New Energy Finance figures released in January.
— With assistance by Feifei Shen