China Institute of Contemporary International Relations (CICIR)

At CICIR we discussed energy policymaking in China with a top scholar and policymaker. She argued that there should be a single energy ministry that handles the numerous energy portfolios residing in other offices. Over the last 28 years, she noted GDP has quadrupled and energy consumption has only doubled, but the energy elasticity of growth is now a real concern. Over the last 6 years the elasticity has been 1, i.e. energy demand growth has been roughly 9.5% annually. Major gains in demand reduction, she argued, are unrealistic in the short term because heavy industry is too large a part of the economy. China is only starting to take demand reduction policies seriously, recently lifting tax rebates for energy-intensive exports and taxing them instead. She believes China must follow EU, Japan in realm of taxing energy consumption.