National Development and Reform Commission and National Energy Administration on Improving Energy…

Opinions on the institutional mechanisms and policy measures for a green and low-carbon transformation

National Development and Reform Commission Energy [2022] No. 206

People's Governments of provinces, autonomous regions, and municipalities directly under the central government; the Xinjiang Production and Construction Corps; relevant departments of the State Council; relevant central enterprises; and relevant industry associations:

  Activities related to energy production and consumption are the primary source of carbon dioxide emissions. Vigorously promoting carbon reduction in the energy sector is a crucial step for achieving peak carbon and carbon neutrality goals, as well as for accelerating the development of a modern energy system. Since the 18th National Congress of the Communist Party of China, various regions and relevant departments have formulated a series of policies and measures aimed at fostering green and low-carbon energy development. As a result, significant progress has been made in the development and utilization of clean energy sources such as solar, wind, hydro, biomass, and geothermal energy. However, existing institutional mechanisms, policy frameworks, and governance approaches still face certain difficulties and challenges, making it hard for them to meet the demands of advancing the green and low-carbon energy transition under the new circumstances. To thoroughly implement the requirements set forth in the "Opinions of the CPC Central Committee and the State Council on Fully, Accurately, and Comprehensively Implementing the New Development Philosophy and Doing a Good Job in Achieving Peak Carbon and Carbon Neutrality" and the "Action Plan for Reaching Peak Carbon Emissions Before 2030," and with the approval of the State Council, we hereby put forward the following opinions on improving the institutional mechanisms and policy measures for promoting a green and low-carbon energy transition.

  I. General Requirements

  (1) Guiding Ideology.

  Guided by Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, we will fully implement the spirit of the 19th National Congress of the Communist Party of China and all subsequent plenary sessions of the 19th Central Committee, deeply embrace Xi Jinping’s Thought on Ecological Civilization, adhere to the general principle of pursuing progress while ensuring stability, ground ourselves in the new stage of development, fully, accurately, and comprehensively implement the new development philosophy, and foster a new development pattern. We will vigorously promote revolutions in energy consumption, supply, technology, and systems, strengthen international cooperation in all respects, and, based on China’s national conditions, strike a balance between development and security, between steady growth and structural adjustment. We will deepen reform and innovation in the energy sector’s institutional mechanisms, accelerate the establishment of a clean, low-carbon, safe, and efficient energy system, and promote high-quality energy development as well as a comprehensive green transformation of the economy and society, thereby providing solid guarantees for scientifically and orderly achieving our carbon peak and carbon neutrality goals on schedule and for building a modern economic system.

  (2) Basic Principles.

  — Uphold a systematic approach and promote coordinated advancement. Strengthen top-level design, leverage institutional advantages, and strike a balance among development and emission reduction, the whole and the part, and the short-term with the medium- and long-term. Properly manage the complementary, coordinated, and substitutive relationships among different energy sources at various stages of the transition, promote an optimized combination of coal and new energy sources, and advance the green and low-carbon energy transition nationwide and in each region in a coordinated manner.

  — Uphold the principles of ensuring energy security and promoting a smooth, orderly transition. On the premise of safeguarding energy security, advance the green and low-carbon energy transition in an orderly manner, adopting a “first establish, then dismantle” approach. Adhere to a nationwide, coordinated strategy, and strengthen risk identification and management throughout the transition process. On the basis of accelerating the development of reliable supply capabilities for clean, low-carbon energy sources, gradually and safely replace fossil fuels with secure and dependable alternatives.

  — Uphold innovation-driven development and intensive, efficient practices. Improve the innovation system and incentive mechanisms in the energy sector, and enhance our capacity for innovation in key core technologies. Implement the principle of prioritizing conservation, strive to reduce resource consumption and carbon emissions per unit of output, boost the efficiency of energy system operations and resource allocation, and improve overall economic and social benefits. Accelerate the establishment of incentive and constraint mechanisms for pollution reduction and carbon reduction.

  — Adhere to market-led and government-guided approaches. Deepen institutional reforms in the energy sector, fully leveraging the market’s decisive role in resource allocation and building an energy market system that is fair, open, and characterized by effective competition. Further enhance the government’s role by strengthening guidance in areas such as strategic planning, policy support, and market regulation, thereby fostering a favorable development environment.

  (3) Main objectives.

  During the 14th Five-Year Plan period, we will basically establish an institutional framework for promoting green and low-carbon energy development, forming a relatively complete system of policies, standards, markets, and regulatory mechanisms. We will also build a mechanism to drive the green and low-carbon energy transition, guided by the dual-control system for energy consumption and the target system for non-fossil energy sources. By 2030, we will have basically established a comprehensive system of fundamental institutions and policies for green and low-carbon energy development, creating an energy production and consumption pattern in which non-fossil energy sources not only meet the incremental demand for energy but also replace fossil energy stocks on a large scale, while energy security capabilities are comprehensively enhanced.

  II. Improve the coordinated promotion mechanism for implementing the national energy strategy and planning.

  (4) Strengthen the guiding and regulatory role of energy strategies and planning. Guided by the national energy strategy, enhance the leading role of the national energy plan. Each province (autonomous region, municipality directly under the central government) shall, in light of the national energy plan and local conditions, formulate its own regional energy plan, clearly defining the goals and tasks for a green and low-carbon energy transition. During plan formulation and implementation, strengthen coordination and mutual support among different energy types, between upstream and downstream segments of industrial chains, and across regions, thereby comprehensively enhancing the level of green and low-carbon energy transition and ensuring energy supply security. Strengthen monitoring and evaluation of energy plan implementation, and improve the mechanism for dynamic adjustment of plans.

  (5) Establish a monitoring and evaluation mechanism for the green and low-carbon energy transition. Focus on monitoring and evaluating indicators such as energy intensity in various regions, total energy consumption, the share of non-fossil and renewable energy consumption, and the carbon emission factor associated with energy consumption. Assess the implementation status and actual effects of mechanisms and policies related to the green and low-carbon energy transition. Improve the assessment mechanism for green and low-carbon energy development, strengthening relevant assessments based on binding energy-related indicators specified in the Outline of National Economic and Social Development Plans, annual plans, and energy plans. Encourage regions to meet national targets for minimum shares of renewable energy consumption through regional cooperation or by engaging in trading of renewable energy power consumption volumes.

  (6) Improve the organizational and coordination mechanism for the green and low-carbon energy transition. The National Energy Commission shall provide overall coordination of strategies, development plans, action plans, and policy frameworks related to the green and low-carbon energy transition. A cross-departmental and cross-regional coordination mechanism for energy security and development shall be established to facilitate coordinated efforts in building infrastructure—including inter-provincial and inter-regional power transmission lines, oil and gas pipelines, and storage facilities—as well as ensuring energy security. Close alignment shall be maintained among energy planning, major projects, land-use planning, and special plans for ecological and environmental protection, with timely identification and resolution of issues arising during implementation. An annual ledger shall be maintained for the implementation of major policies and construction of major projects related to the green and low-carbon energy transition and energy security assurance, and the supervision and coordination mechanisms shall be continuously refined and improved.

  III. Improve the institutional and policy framework for guiding green energy consumption.

  (7) Improve the dual-control system for energy consumption and the target-setting system for non-fossil energy sources. Uphold energy and resource conservation as a top priority, strengthen management of binding indicators for reducing energy intensity, and effectively enhance the flexibility of total energy consumption management. Newly added renewable energy and raw-material energy consumption will be excluded from the overall energy consumption control. Reasonably set energy-intensity reduction targets for each region, and closely align the dual-control policy for energy consumption with the goals of peaking carbon emissions and achieving carbon neutrality. Gradually establish a carbon-emission control mechanism in the energy sector. Revise and formulate mandatory national standards for energy consumption limits per unit of product in key energy-consuming industries, and organize supervision and inspection to ensure compliance by key energy-consuming enterprises. Study and develop methodologies for calculating carbon emissions in key industries and for key products. Taking into account regional renewable-energy resources, development and utilization conditions, and economic development levels, scientifically allocate nationwide medium- and long-term targets for the total amount and minimum proportion of renewable-energy development and utilization to each province (autonomous region, municipality), and refine mechanisms to ensure the consumption of renewable-energy electricity. Promote localities in establishing and improving energy-budget management systems, and explore conducting evaluations of energy-consumption efficiency and output benefits. Strengthen top-level design and coordinated planning, and accelerate the construction of a nationwide carbon-emissions trading market, an energy-use-rights trading market, and a green-electricity trading market.

  (8) Establish and improve mechanisms to promote green energy consumption. Advance the development of a unified system for green product certification and labeling, set up a certification mechanism for green energy consumption, and encourage various social organizations to recognize and adopt the results of such certifications. Establish a mechanism to promote electricity substitution, strengthening technical guidance on electricity substitution through refining relevant standards and other measures. Improve and expand the trading of green power certificates to boost green electricity consumption. Encourage all sectors of society to prioritize the use of green energy and the procurement of green products and services; public institutions should lead by example. All regions should, based on their local conditions, adopt advanced energy efficiency and green energy consumption standards, vigorously promote the concepts of energy conservation and green consumption, and carry out in-depth initiatives to foster green lifestyles. Encourage regions with favorable conditions to launch high-level demonstration projects for green energy consumption and advocate for energy-saving practices throughout society.

  (9) Improve policies supporting green energy consumption in the industrial sector. Guide industrial enterprises to adopt clean energy alternatives and reduce carbon emissions per unit of product. Encourage enterprises that meet the necessary conditions to take the lead in adopting low-carbon and zero-carbon energy consumption models. Promote the development of green energy-intensive industrial parks and enterprises, foster industrial green microgrids, and support the development and utilization of clean, low-carbon energy sources on company-owned premises. Build distributed clean energy and smart energy systems. Provide exemptions from cross-subsidies and system reserve fees for the comprehensive utilization of waste heat, waste pressure, and waste gas to generate electricity. Further refine pricing policies to support self-consumption of distributed clean energy generation. Provided that such projects comply with power planning layouts and grid safety operation requirements, encourage the use of innovative power transmission and operational methods to enable renewable energy projects to supply power directly to industrial parks or enterprises nearby. Encourage industrial parks and enterprises to procure green electricity through the electricity market. Promote the use of green energy as the primary source of energy demand in emerging key energy-consuming sectors, while making full use of waste heat, waste pressure, and waste gas.

  (10) Improve policies for green energy use and clean heating in buildings. Raise building energy efficiency standards, promote the large-scale development of ultra-low-energy and low-carbon buildings, advance and support energy-saving renovations of existing buildings, actively encourage the use of green building materials, and establish a sound building energy consumption quota management system. Refine standards for the application of renewable energy in buildings, encourage integrated photovoltaic building systems, and support the construction of renewable energy-based building energy supply systems utilizing solar, geothermal, and biomass energy sources. In regions where conditions permit, advance reforms in heat metering and smart upgrades of heating facilities, encourage heat-based billing, and encourage electric heating enterprises and users to obtain low-priced electricity during off-peak hours through the power market. Provide comprehensive support through mechanisms such as peak-valley electricity pricing, tiered residential electricity pricing, and transmission and distribution tariffs. Fully implement gas pricing policies that support clean winter heating in rural areas of northern China.

  (11) Improve policies for clean energy substitution in the transportation sector. Promote a green and low-carbon transformation of transportation, optimize the structure of the transportation system, and advance the adoption of green and low-carbon transportation facilities and equipment. Encourage the widespread use of high-capacity electrified public transport as well as clean-energy vehicles powered by electricity, hydrogen, advanced bio-liquid fuels, and natural gas. Enhance the layout and service infrastructure of charging/battery-swapping stations, hydrogen refueling stations, and LNG fueling stations, thereby reducing the cost of clean-energy consumption in the transportation sector. Provide support for the planning and construction of transportation energy supply stations in terms of land use and spatial allocation, and promote the integrated development of multiple energy sources at these stations. Launch pilot demonstrations of energy interaction between new-energy vehicles and the power grid, and foster coordinated development between vehicle-charging infrastructure and shore-side facilities. For projects involving the construction of new-energy facilities along railway lines or in highway service areas, encourage unified planning, unified implementation, and unified approval (or filing) within the same provincial-level region.

  IV. Establish a new mechanism for energy development and utilization that is oriented toward green and low-carbon practices.

  (12) Establish a mechanism for surveying and sharing information on clean, low-carbon energy resources. Based on factors such as resource endowments, land use patterns, ecological conservation requirements, and territorial spatial planning, conduct comprehensive, detailed surveys and integrated assessments of clean, low-carbon energy resources nationwide, using city- and county-level administrative regions as basic units. Accurately identify developable clean, low-carbon energy resources and integrate the resulting data, continuously improving and dynamically updating the national database of clean, low-carbon energy resources. Strengthen integration with the national territorial spatial information platform, promptly incorporating spatial information on the distribution of various clean, low-carbon energy resources into the corresponding territorial spatial information platforms and “single-map” territorial spatial plans at the same level. Also, share this information in an appropriate manner with local governments at all levels, enterprises, industry associations, and research institutions. Enhance technical capabilities in meteorological observation, resource assessment, and forecasting related to renewable energy, providing support for renewable energy resource surveys, project development, and power system operations. Build a national energy information infrastructure and sharing platform, integrating information across the entire energy value chain and promoting the development of the digital economy in the energy sector.

  (13) Promote the establishment of an energy supply system dominated by clean and low-carbon energy sources. Focusing on desert, gobi, and arid regions, accelerate the construction of large-scale wind power and photovoltaic power bases. Upgrade and transform existing coal-fired generating units within these regions, explore mechanisms for coordinated operation at both sending and receiving ends to provide regulation for the transmission of new energy electricity, and support the full-scale development, grid connection, and generation of new energy sources. Each region shall, in accordance with the national energy strategy and planning as well as sector-specific plans, comprehensively consider its local energy demand and clean and low-carbon energy resources. Under the overall framework of provincial energy planning, guide and organize the formulation of implementation plans at the city (and county) level for the development and utilization of clean and low-carbon energy and for regional energy supply. Each region should take into account its local energy demand and available resource potential, prioritizing the development and utilization of local clean and low-carbon energy resources based on the principle of proximity. At the same time, where necessary, actively introduce clean and low-carbon energy from outside the region, thereby creating an energy production and consumption pattern in which newly added energy demand is primarily met by clean and low-carbon energy sources and fossil fuels are gradually replaced. Regions are encouraged to build new-type energy systems that feature complementary multi-energy sources, local balance, and a dominant role for clean and low-carbon energy.

  (14) Innovate mechanisms for the development and utilization of renewable energy in rural areas. In rural regions, prioritize supporting the grid connection of rooftop distributed photovoltaic power generation as well as biomass energy generation such as biogas power generation. Grid enterprises and other relevant entities shall give priority to purchasing the electricity generated by these projects. Encourage the use of land in rural areas suitable for decentralized wind and photovoltaic power development, and explore investment and operation models for renewable energy projects featuring unified planning, decentralized deployment, cooperation between agricultural enterprises and developers, and shared benefits. Encourage rural collective economic organizations, in accordance with the law, to invest jointly with specialized enterprises in renewable energy generation projects through methods such as contributing land-use rights as equity or establishing joint ventures. Also encourage financial institutions to provide financing support for renewable energy generation projects based on market-oriented and rule-of-law principles. Increase support for rural power grid construction and organize grid enterprises to improve rural power grids. Strengthen innovation in rural power grid technologies, operational practices, and electricity trading mechanisms; support local transactions of new energy electricity; and provide low-cost, green energy supplies for rural public welfare services, residential consumption, and industries related to rural revitalization. Improve support policies and guarantee mechanisms for the large-scale development and utilization of biomass energy sources such as biogas, biomethane, and solid-formed fuels, as well as geothermal energy.

  (15) Establish a land and spatial management mechanism for the development and utilization of clean, low-carbon energy sources. In alignment with efforts to achieve peak carbon emissions and carbon neutrality, comprehensively consider the land and sea use requirements for developing clean, low-carbon energy sources as well as for infrastructure such as energy transmission and storage. Improve policy guidance on land classification for energy project construction, adjust and optimize land and sea use requirements for renewable energy development, formulate land support policies for constructing renewable energy power projects on desert, gobi, and barren lands, refine the protection system for nuclear power plant and pumped-storage hydropower station sites, and ensure their protection in land and spatial planning. In land and spatial planning, systematically take into account land needs for transmission corridors and oil-and-gas pipeline corridors, and establish and improve mechanisms for sharing land-related information and coordinated management. Strictly regulate, in accordance with the law, the collection of taxes and fees related to land (and sea) use in energy development. Renewable energy projects such as offshore wind power that meet the relevant conditions may, in accordance with regulations, apply for reductions or exemptions from sea-use fees. Encourage the promotion and application of land-saving technologies and land-saving models in the development and construction of new energy sources such as wind power.

  V. Improve the construction and operational mechanisms of the new power system.

  (16) Strengthen the top-level design of the new power system. Promote the clean transformation of power sources and the electrification of end-use energy consumption. In response to the needs of new-energy power development, formulate a development strategy and overall plan for the new power system, and encourage various entities—including enterprises—to actively participate in the construction of the new power system. Conduct adaptive assessments of existing power systems to support their transition toward green and low-carbon development, and enhance and optimize systems in areas such as grid architecture, power supply structure, coordinated management of generation, transmission, load, and storage, as well as digital and intelligent operation and control. Strengthen basic theoretical research on the new power system, drive breakthroughs in key core technologies, and develop relevant standards for the new power system. Promote the integrated development of internet, digitalization, and intelligent technologies with the power system, foster the development of new technologies, new business models, and new formats, and build a smart energy system. Strengthen the construction of the technical framework for the new power system, and carry out related technology pilots and regional demonstrations.

  (17) Improve the power grid system to better accommodate both the localized, deep utilization of renewable energy and its wide-area transmission. Overall optimize the operation of the transmission network and power system to enhance the capacity for transmitting and absorbing renewable energy electricity. Through optimized configuration and operational adjustments of power sources, maximize the use of existing transmission channels to carry renewable energy power; establish clear minimum proportion targets and incorporate them into performance assessments. Coordinated planning should be carried out to develop large-scale power bases primarily dedicated to transmitting renewable energy electricity, and regulatory resources should be optimally allocated at the provincial-level grid and above. Further refine the collaborative mechanisms for renewable energy transmission and absorption, integrating inter-provincial (autonomous region, municipality) government agreements with electricity markets. Strengthen inter-provincial and inter-regional grid interconnections, further improve the mechanism for forming cross-provincial and cross-regional electricity prices, and promote wider-scale absorption of renewable energy. Vigorously advance the construction of smart distribution networks capable of accommodating high proportions of distributed new energy power, and encourage the development of integrated source-grid-load-storage smart energy systems and microgrids that feature multi-energy complementarity. Grid enterprises should enhance their capacity to integrate new energy power, dynamically disclose information on the capacity available for accepting new energy power within their operating areas, and provide corresponding query services. In accordance with laws and regulations, they should connect new energy generation projects and distributed generation projects that meet planning requirements and safety production standards to the grid, ensuring that all eligible projects are connected as soon as possible.

  (18) Improve market mechanisms to support the new power system. Establish a nationwide, unified electricity market system, accelerate the development of ancillary services markets, promote pilot operations of spot electricity markets in key regions, refine the integrated mechanism for medium- and long-term, spot, and ancillary services trading, explore capacity market trading mechanisms, deepen reforms in key areas such as transmission and distribution, and foster green and low-carbon electricity development through market-oriented approaches. Enhance electricity trading mechanisms that favor the priority use of renewable energy, launch pilot programs for green electricity trading, and encourage renewable energy generators to enter into long-term power purchase agreements with electricity users or power sales companies. Support emerging market players—such as microgrids, distributed energy sources, energy storage systems, and load aggregators—to participate independently in electricity trading. Actively promote market-based trading of distributed generation, allowing distributed generation (including electric energy storage, electric vehicles, and electric vessels) to conduct nearby transactions with electricity users within the same distribution network via electricity trading platforms. Grid enterprises (including those operating incremental distribution networks) will provide technical support—including transmission, metering, and transaction settlement—and refine pricing policies and market rules to support market-based trading of distributed generation. Further improve electricity pricing policies to support energy storage applications.

  (19) Improve the mechanisms for constructing and operating flexible power sources. Fully implement flexibility upgrades for coal-fired generating units, refine technical standards for the minimum output of coal-fired units, and scientifically determine their deep peak-shaving capabilities. Based on local conditions, build natural gas “dual-peak-shaving” power plants that not only meet the demand for peak-shaving in power system operations but also help smooth out seasonal fluctuations in natural gas consumption. Actively promote the construction of control reservoirs in river basins and the expansion and capacity increase of conventional hydropower stations. Accelerate the development of pumped-storage hydroelectric power stations, explore the application of small- and medium-sized pumped-storage technologies, and advance cascade hydropower storage systems. Leverage the regulating role of solar thermal power generation, carry out research and demonstration projects for new energy storage technologies such as repurposing abandoned mines, and gradually expand the application of these new energy storage systems. Fully promote the participation of enterprise-owned power plants in power system regulation, and encourage industrial enterprises to utilize the regulating capabilities of their own power plants to locally integrate and consume new energy sources. Improve price compensation mechanisms to support the operation of flexible coal-fired units, natural gas peaking units, hydropower, solar thermal power generation, and energy storage facilities—these adjustable power sources. Encourage new energy generation bases to enhance their self-regulating capabilities and explore integrated participation in power system operations. Further refine mechanisms for pumped-storage and new energy storage facilities to participate in the electricity market, thereby better harnessing the regulatory roles of these facilities.

  (20) Improve the electricity demand response mechanism. Promote the market-oriented development of electricity demand response, and encourage the integration of adjustable resources on the demand side into power supply-demand balance. Leverage these demand-side resources to shave peaks and fill valleys, promote balance between power supply and demand, and enhance the ability to accommodate the operation of new energy sources. Expand the scope of electricity demand response implementation by tapping into various demand-side resources through multiple channels and organizing their participation in demand response. Support user-side adjustable resources such as user-side energy storage systems, electric vehicle charging facilities, and distributed generation, as well as entities like load aggregators, virtual power plant operators, and integrated energy service providers, enabling them to participate in electricity market transactions and system operation adjustments. Clearly define the safety standards and requirements for the safe development of user-side energy storage, and strengthen safety supervision. Accelerate the market-oriented development of demand response and explore establishing a market-based compensation mechanism for demand response. Conduct comprehensive surveys and evaluations of demand-response resources, establish a tiered and categorized inventory, and build a dynamic database of demand-response resources.

  (21) Explore the establishment of a regional integrated energy service mechanism. Explore the operation, by the same market entity, of multi-energy complementary and combined supply regional integrated energy systems that integrate power supply, heating (and cooling), and gas supply. Encourage local authorities to adopt competitive approaches such as tendering to select investment and operational entities for regional integrated energy services. Encourage incremental distribution networks to increase the share of clean energy by expanding distributed clean energy sources within the region and integrating renewable energy from outside the region. Public grid enterprises and gas supply enterprises should provide reliable energy supplies to integrated energy service operators and ensure smooth coordination of supporting infrastructure operations. Encourage the enhancement of smart energy synergy service levels, strengthen platform-based services for common technologies, and promote innovation in business models. Fully leverage existing facilities, while ensuring the security of energy data, and intensify the open sharing of data resources.

  VI. Improve the mechanisms for clean and efficient development and utilization of fossil energy.

  (22) Improve policies for the clean development and utilization of coal. Based on China’s fundamental national condition of relying primarily on coal, and in accordance with the different stages of energy development, fully leverage coal’s foundational role in ensuring energy supply. Establish a long-term mechanism for the green development of coal mines, optimize the spatial layout of coal production capacity, intensify efforts to “phase out smaller mines in favor of larger, more efficient ones,” and vigorously promote the clean and efficient use of coal. Formulate supportive policies for optimizing mine systems, refine the standards system for building green and intelligent coal mines, and improve the policy framework supporting the development of intelligent technologies, equipment, and talent in the coal mining industry. Enhance support policies for the comprehensive utilization of resources such as coal gangue, mine water, and underground coalbed methane extraction, as well as for ecological restoration and rehabilitation of mining areas. Step up efforts to promote the application of coal-filled mining technology, and encourage the development and construction of new energy and energy storage projects in abandoned mining areas. In accordance with laws and regulations, accelerate the processing of environmental protection, land-use, approval, and mining-related procedures for high-quality capacity such as green and intelligent coal mines, as well as for coal mines that ensure supply. Conduct scientific assessments of the impacts resulting from reductions in coal production and mine closures and exits, and study and refine support policies related to the exit and transformation of coal enterprises, as well as the re-employment of affected workers.

  (23) Improve policies for the clean and efficient transformation of coal-fired power. On the premise of ensuring reliable power supply and energy security, coordinate and systematically control and reduce coal consumption, and promote a balanced transition of coal-fired power toward both base-load and system-regulating roles. In accordance with the requirements for safe, stable operation and secure power supply of the electric power system, strengthen overall coordination among coal-fired generating units and non-fossil fuel power generation, natural gas power generation, and energy storage. Promote energy-saving and efficiency-enhancing upgrades as well as ultra-low emission retrofits for coal-fired generating units, and rationally build advanced coal-fired generating units based on energy development needs and the requirement for secure power supply. Fully tap the heating potential of existing large-scale combined heat and power (CHP) enterprises; encourage the retrofitting of existing condensing coal-fired generating units within reasonable heating radii to implement CHP operations; in regions where coal-fired heating is permitted, encourage the construction of coal-fired back-pressure heating units; and explore the implementation of steam extraction-based energy storage retrofits for coal-fired generating units. Orderly promote the closure and consolidation of outdated coal-fired generating units, and intensify efforts to phase out coal-fired boilers. In principle, no new coal-fired captive power plants owned by enterprises shall be built. Promote fair social responsibility obligations for coal-fired captive units, and step up energy conservation and emission reduction efforts at these units. Support the use of decommissioned thermal power plant sites and related facilities to construct new energy storage systems or to convert them into synchronous condensers. Improve support policies for research, development, and demonstration projects related to carbon dioxide capture, utilization, and storage technologies in the thermal power sector.

  (24) Improve the mechanisms for clean and efficient utilization of oil and gas. Enhance the capacity for clean and efficient oil and gas field exploitation, promote the transformation and upgrading of the refining and petrochemical industry, and intensify efforts to synergistically reduce pollution and carbon emissions. Perfect the mechanisms for coordinated development of oil and gas resources with geothermal energy as well as renewable energy sources such as wind and solar power. Encourage oil and gas enterprises to leverage their own land holdings to develop renewable energy sources and build distributed energy facilities, and to establish multi-energy integrated regional energy supply systems within oil and gas field areas. Continuously promote fair and open access to oil and gas pipeline networks and refine access standards. Streamline the natural gas supply chain and reduce the number of supply levels. On the premise of meeting safety and quality standards, support the integration of clean fuels such as bioethanol, biodiesel, and biomethane into oil and gas pipeline networks. Explore efficient hydrogen transportation methods, including blending hydrogen into natural gas pipelines, transporting pure hydrogen via dedicated pipelines, and shipping liquid hydrogen. Encourage traditional gas stations and CNG stations to transform into integrated transportation energy service stations offering oil, gas, electricity, and hydrogen services. Strengthen the promotion and demonstration of carbon dioxide capture, utilization, and storage technologies; expand the application of CO2-enhanced oil recovery techniques; and explore using underground spaces created by oil and gas extraction to store CO2.

  7. Improve the safety and supply system for a green and low-carbon energy transition.

  (25) Improve the energy forecasting and early-warning mechanism. Strengthen the construction of national and tiered, categorized information systems for energy production, supply, and consumption. Establish a cross-departmental and cross-regional energy security monitoring and early-warning mechanism. All provinces (autonomous regions and municipalities directly under the central government) shall establish comprehensive regional energy monitoring systems. Grid operators, oil and gas pipeline networks, and key energy supply enterprises shall enhance their energy supply monitoring platforms within their operational areas and promptly report relevant information to the competent authorities. Strengthen capacity building for monitoring and assessing energy forecasts and early warnings, and establish a joint response mechanism involving departments such as energy, emergency management, meteorology, water resources, and geology to address extreme weather events, thereby enhancing predictive capabilities and disaster prevention resilience. Improve the risk-response mechanism for energy supply, refine emergency plans for energy supply under extreme circumstances, and perfect coordinated regulation mechanisms during emergency states.

  (26) Build a comprehensive system for the safe operation and integrated defense of the power grid. All types of generating units must strictly comply with relevant laws, regulations, and technical standards, including the "Regulations on Grid Dispatching Management." A review mechanism should be established for the retirement of coal-fired generating units. Coal-fired units that are tasked with supporting the operation of the power grid and ensuring power supply shall not be retired without prior approval; they may, after assessment based on unit performance and grid operational needs, be reclassified as emergency standby units. A safety assessment system for power planning at all levels should be established, and technical standards for connecting various power sources to the grid should be refined to control safety risks from the source. The management of power balance and electricity quantity should be improved, and annual plans for ensuring the safe and reliable supply of electricity should be formulated. An information-sharing and emergency coordination mechanism should be established among power companies, fuel suppliers, and pipeline transportation enterprises to ensure energy supply under extreme circumstances. A cross-departmental joint prevention and control mechanism for critical transmission channels should be set up to enhance the operational safety and security of these key transmission lines. An advanced emergency power supply system should be established and perfected for load centers and mega-cities. The security protection system for power monitoring systems should be improved, and the security protection of critical information infrastructure in the power industry should be strengthened. Local governments and relevant power enterprises must strictly fulfill their primary responsibilities for power production safety and supply assurance, coordinate and promote the construction of an emergency power system in a holistic manner, enhance capabilities for preventing and handling safety incidents involving new energy storage facilities and other equipment, and raise the level of intrinsic safety. The power emergency保障 system should be further improved, and the power emergency regulations, standards, and contingency plans should be refined and perfected.

  (27) Improve the energy supply guarantee and emergency reserve system. Coordinate the green and low-carbon energy transition with the assurance of energy supply security, enhance the capacity to ensure energy supply under various extreme circumstances and in response to economic and social development needs, optimize the layout of energy reserve facilities, and refine the coordination mechanism for ensuring the supply of coal, power, oil, and gas. Accelerate the establishment of an oil reserve system that organically integrates government reserves, corporate social responsibility reserves, and operational production inventories, complementing each other; a system that combines physical reserves, capacity reserves, and other reserve approaches. Improve the systems for coal product reserves, capacity reserves, and emergency reserves, refine mechanisms for emergency peak-shaving capacity, adjustable inventories, and coal reserves at key power plants, and establish an enterprise-led, market-oriented coal emergency reserve system. Establish and improve a multi-level natural gas storage, peak-shaving, and emergency response system in which local governments, gas suppliers, pipeline operators, and urban gas companies each assume their respective responsibilities. Formulate support policies for the technological reserves of coal-to-oil and coal-to-gas conversion. Perfect the production, supply, storage, and sales systems for coal, oil, and natural gas, and explore the establishment of a hydrogen energy production, supply, storage, and sales system. Actively promote the construction of leading reservoir hydropower stations in river basins according to plans, thereby enhancing the reservoirs’ energy storage, operational regulation, and emergency dispatch capabilities.

  8. Establish a science and technology innovation system that supports the green and low-carbon transformation of the energy sector.

  (28) Establish a major collaborative innovation system for clean and low-carbon energy technologies. Fully leverage the role of national laboratories in the energy sector, and build an energy technology innovation system that is led by national strategic scientific and technological forces, driven by enterprises, market-oriented, and deeply integrated across industry, academia, research, and application. Accelerate breakthroughs in a number of key technologies for clean and low-carbon energy. Support leading enterprises in the industry to join forces with universities, research institutes, and upstream and downstream companies to co-build national R&D and innovation platforms in the energy sector, and promote the sharing and optimized allocation of various scientific and technological resources. Conduct joint research and tackle key technologies related to foundational components and devices, basic software, basic materials, and basic processes in the energy sector, and carry out major collaborative innovation studies in energy technologies. Strengthen research and development of safety technologies related to new energy storage systems, and improve technical standards and specifications covering equipment and facilities, planning and layout, design and construction, and safe operation.

  (29) Establish a collaborative innovation mechanism for the clean and low-carbon energy industry chain and supply chain. Promote the development of an innovation-driven mechanism for clean and low-carbon energy technologies that is oriented toward technological advancements on the demand side, deeply integrates industry, academia, research, and application, fosters synergy across the upstream and downstream sectors, and encourages supply-chain collaboration. Relying on major energy projects such as large-scale new-energy bases, advance coordinated efforts among upstream and downstream enterprises to develop, manufacture, and deploy advanced technologies and equipment, and through engineered integration and application, build advanced technological capabilities and industrialization capacities. Accelerate collaborative research and development and demonstration of key technologies for advanced renewable energy fuels such as cellulosic non-grain biofuel ethanol and biojet fuel, and expedite their industrialization. Promote high-quality development of the energy electronics industry, foster integrated innovation between information technology and products and clean and low-carbon energy sources, and accelerate the innovative upgrading of smart photovoltaics. Building upon existing foundations, improve clean and low-carbon energy technology innovation service platforms, and promote deep integration of science and technology service industries—including R&D design, metrology and testing, inspection and certification, and intellectual property services—into the clean and low-carbon energy industry chain. Establish mechanisms for evaluating, transferring, and promoting technological achievements in clean and low-carbon energy.

  (30) Improve incentive policies for technological innovation in the green and low-carbon energy transition. Explore market-oriented approaches to attract social capital to support R&D and demonstration projects for strategic clean and low-carbon energy technologies that require substantial funding and pose high research challenges. Adopt mechanisms such as "listing challenges and appointing leaders" to organize efforts to tackle major critical technologies, refine policies supporting the demonstration and application of first-of-its-kind advanced energy technology equipment, and promote the widespread adoption of key energy technologies. Strengthen performance assessments of state-owned energy enterprises related to energy conservation and carbon reduction, encourage enterprises to increase investment in energy technology innovation, promote the application of new technologies, and enhance their technological capabilities.

  9. Establish a fiscal and financial policy support mechanism to underpin the green and low-carbon transformation of the energy sector.

  (31) Improve the diversified investment and financing mechanisms that support the green and low-carbon transformation of the energy sector. Increase financial support for clean and low-carbon energy projects as well as projects aimed at ensuring energy supply security. Through centralized budgetary investments, provide coordinated support for projects in the energy sector that make significant contributions to carbon reduction. Include major clean and low-carbon energy projects meeting the relevant criteria within the scope of local government special bonds. The National Green Development Fund and existing funds dedicated to low-carbon transition should prioritize supporting the development and utilization of clean and low-carbon energy sources, the construction of new power systems, and the green and low-carbon transformation of fossil fuel enterprises. Promote market-oriented investment and financing for infrastructure projects related to clean and low-carbon energy, and explore including such projects in the pilot program for real estate investment trusts (REITs) in the infrastructure sector. Further tilt central fiscal funds toward rural energy development, leveraging existing funding channels to support the construction of rural energy supply infrastructure, clean heating in northern regions during winter, and building energy efficiency improvements.

  (32) Improve financial support policies for the green and low-carbon energy transition. Explore the development of supply-chain finance for the clean and low-carbon energy sector. Refine loan approval processes and rating methodologies for enterprises in the clean and low-carbon energy industry, giving full consideration to the long-term growth potential of related industrial chains as well as their contributions to peaking carbon emissions and achieving carbon neutrality. Innovate green financial products tailored to the characteristics of clean and low-carbon energy, encourage eligible enterprises to issue green bonds such as carbon-neutral bonds, and guide financial institutions to increase support for projects with significant carbon reduction benefits. Encourage the issuance of sustainability-linked bonds and other similar instruments to support the green and low-carbon transformation of fossil fuel enterprises. Explore and promote the application of energy-related basic data to provide information services that underpin financial support for the green and low-carbon energy transition. Encourage energy enterprises to embrace the concept of green development and fully disclose information related to carbon emissions.

  X. Promote international cooperation on the green and low-carbon energy transition.

  (33) Promote green energy cooperation under the Belt and Road Initiative. Encourage innovation in financial products and services, and support the development and utilization of clean, low-carbon energy resources along the Belt and Road. Advance practical green energy cooperation under the Belt and Road Initiative, and explore mechanisms for collaborative development and synergy among upstream and downstream enterprises in the clean, low-carbon energy value chain. Guide enterprises to engage in overseas investment in the field of clean, low-carbon energy, and emphasize resource conservation, environmental protection, and safe production in the implementation of relevant projects. Promote the establishment of best-practice projects for energy cooperation. Manage the production, circulation, and export of products with high carbon emission intensity in accordance with laws and regulations.

  (34) Actively promote cooperation on the green and low-carbon transformation in global energy governance. Build and effectively operate cooperative platforms such as the Belt and Road Energy Partnership and the International Forum on Energy Transformation, striving to play a greater role in the global transition toward green and low-carbon development. Relying on cooperation platforms including the China-Arab League, China-African Union, China-ASEAN, China-Central and Eastern Europe, and the APEC Sustainable Energy Center, continue to support the joint training of technical personnel in clean and low-carbon energy technologies—including renewable energy, power generation, nuclear power, and hydrogen energy—and carry out capacity-building initiatives, policy alignment, planning coordination, standard harmonization, and talent exchanges. Enhance cooperation with international organizations such as the International Energy Agency (IEA) and the International Renewable Energy Agency (IRENA), and actively participate in and guide energy-related green and low-carbon transformation cooperation within multilateral frameworks including the United Nations, the Group of Twenty (G20), APEC, BRICS, and the Shanghai Cooperation Organization.

  (35) Fully leverage international factors to support China’s green and low-carbon energy development. Implement the Catalog of Industries Encouraged for Foreign Investment, refine relevant supporting policies, and attract and guide foreign investment into the clean and low-carbon energy sector. Improve incentive mechanisms that encourage foreign investment to integrate into China’s innovation system for clean and low-carbon energy industries, and strictly enforce intellectual property rights protection. Strengthen international cooperation on green electricity certification, advocate for the establishment of an international green electricity certificate system, and actively guide and participate in the research and formulation of international standards for the issuance, measurement, and trading of green electricity certificates. Promote the establishment of international cooperation platforms for clean and low-carbon energy technology innovation, such as the China-Europe Energy Technology Innovation Cooperation Platform; support multinational corporations in setting up joint R&D centers for clean and low-carbon energy technologies in China; and foster collaborative research, innovation, and demonstration applications in the fields of clean, low-carbon, decarbonized, and carbon-free technologies.

  11. Improve governance mechanisms related to the green and low-carbon development of energy.

  (36) Improve the energy legal and standards system. Strengthen the rule-of-law framework for green and low-carbon energy development, revise and enhance legal and institutional frameworks in the energy sector, and establish a sound energy legal and regulatory system that meets the requirements of peaking carbon emissions and achieving carbon neutrality. Enhance the targeted nature and effectiveness of relevant laws and regulations, and comprehensively review and remove from existing energy-related laws and regulations any provisions that are inconsistent with the requirements of peaking carbon emissions and achieving carbon neutrality. Improve the standards system for clean and low-carbon energy sources, and accelerate research on, as well as the revision and formulation of, technical and safety standards in areas such as clean and efficient coal-fired power generation, renewable energy power generation, nuclear power, energy storage, hydrogen energy, clean energy heating, and new power systems. Promote the internationalization of standards in sectors such as solar and wind power generation. Encourage regions, industry associations, enterprises, and other entities to formulate, in accordance with the law, stricter local, industry, and enterprise standards. Develop a guiding catalog for green and low-carbon industries in the energy sector, and establish and refine technical standards related to the green and low-carbon transformation of the energy sector, along with corresponding accounting standards for carbon emissions and carbon reduction amounts.

  (37) Deepen the “delegation, regulation, and service” reform in the energy sector. Continue to streamline administration and delegate power, further reducing or abolishing non-essential administrative licensing requirements, and further optimize the business environment in the energy sector to enhance the innovation vitality of market entities. Remove all kinds of barriers and implicit obstacles that constrain market competition, implement the negative list system for market access, and support all types of market entities to enter, on an equal footing and in accordance with the law, into energy sectors not listed on the negative list. Optimize the approval and filing procedures for clean and low-carbon energy projects, and simplify the management processes for distributed energy investment projects. Innovate project construction and management mechanisms for integrated energy services, and encourage regions to leverage the National Online Platform for Investment Project Approval and Supervision to establish multi-department joint review mechanisms for integrated energy service projects, implementing one-stop acceptance and parallel approval procedures.

  (38) Strengthen regulation in the energy sector. Enhance oversight of energy market transactions related to green and low-carbon energy development, as well as the utilization of clean and low-carbon energy sources, to uphold a fair and just energy market order. Steadily advance reform in natural monopoly sectors within the energy industry, and strengthen regulatory oversight over relevant enterprises with regard to aspects such as implementation of planning, fair openness, operational scheduling, service pricing, and social responsibility. Improve the assessment mechanisms for enterprises operating in natural monopoly segments such as power grids and oil-and-gas pipeline networks, with a particular focus on evaluating their performance in fulfilling responsibilities related to ensuring energy supply, promoting technological innovation, and protecting the ecological environment. Innovate regulatory approaches for emerging industries and business models, including integrated energy services, new energy storage technologies, and smart energy systems.

National Development and Reform Commission

National Energy Administration

January 30, 2022