Industrial energy efficiency in China: Achievements, challenges and opportunities

During the years of 2006-2010, corresponding to the 11th Five-Year Plan, China reduced its energy intensity by almost 20%. We review the policy mechanisms - government investment, command-and-control regulation, taxes, and subsidies - China used during this period, and their potential for further reductions. We find that most likely these policy mechanisms alone will not be as effective in subsequent Five-Year Plans. We conclude that although further reductions in energy intensity may be harder to achieve, some market-based policy tools are well suited to fulfill the ambitious targets of reducing China's energy intensity as well as carbon intensity in the following decades.