China Races to Net Zero: What Will China Say No to Next?

In 2017, when China announced its Ban to plastic waste import, a global race to tackle plastic waste, especially plastic packaging, followed. In less than three years, China, as the world largest producer and consumer of plastics, has managed to put its own house in order to win the battle again plastic wastes and pollution, EU, Japan, US, Canada, and many other OECD countries that export their wastes to China and many other SE Asian countries, sped up efforts to find alternatives. A positive convergence has emerged that regulations, standards, and policy incentives from both industrialized countries and Asia, in particular, has emerged and an end to plastic wastes battle continues. The goal is to fundamentally address such a global challenge.

In China, the revolution goes beyond must a national Ban. Reduce, reuse, repurpose and replace are among some strategic focuses adopted to advance the endeavor. a few dozen cities are pioneering No-Waste City Pilots to put together a value chain and infrastructure for material flows to prevent pollution and also to turn plastic wastes into resources. Regulations are rolled out one after another, especially around EPR to hold producers and manufacturers accountable and being part of the solutions. Standards around recycled contents in packaging materials are being reviewed and revised. Fascinating innovations are witnessed from digital technology, AI, deposit products, you name it.

One latest start-up - The Green City Platform - is located in Hangzhou, which champions the digital enabling solutions by working closely with local governments, brands, many SMEs and such leading players like Veolia-Huafei in the originally "informal" sector, to really drive through the value chain. Its latest partnership signup with China's largest beverage brand Nongfu Spring provides another boost to its innovation when "convenient stores" at local communities to bridge the last-mile to connect the value chain.

If we take a look at EU, progresses are made at unprecedented pace, especially in regulations. What is exciting is that EU and China are joining hands to advance this endeavour and leaderhsip together to redefine a global plastic packaging market.

China's saying No to plastic wastes also sent a strong signal to the global community and triggered much more attention to what the country's next move will be, because its potential disruption and impact could be rather dramatic and disruptive due to the size of the market. The second on the list emerges now - coal. The latest development is Chinese government has decided to ban coal import from Australia - thermal coal and metallurgical coal.

Though various guesses of the reason remain, one thing is for sure that China has committed to Paris Agreement to peak its GHG emissions before 2030 and achieve carbon neutral before 2060. This rather fundamental and radical decarbonization commitments requires the country to take unprecedented actions to phase out coal as much and as soon as possible. As we can tell, such a move becomes a big blow to Australian economy, whose coal export has been a major income source. According to NYTimes, coal production in Australia has more than doubled over the past three decades, with the share that is exported jumping to 75% in fiscal 2017, up from 55% in 1990.

S&P Platts estimates that in the first quarter of 2021 alone, Australia will lose out on sales of up to 32 metric tons of thermal coal - the coal for power plants - that would have gone to China. But this is not limited to China. Japan and South Korea have also come out and committed to carbon neutrality by 2050. Japan has announced to retire about 100 of its most inefficient coal plants and invest in renewable energy.

We have all noticed that Australian PM Morrison was not invited to the recent Climate Ambition Summit when only globally recognized leaders with noble commitments to Paris Agreement were given a "seat" at the table.

What will come next after plastic wastes and coal? Oil? Well, colleagues from NRDC in our community have been advocating End Oil. I seem to have plenty of reasons to say so. You know what? It shall be interesting to deep dive together to put a list together on the basis of possibility. It would be very useful for companies to have more clarity and time to get prepared for such dramatic shift and disruption.

At a recent online discussion, a colleague from China energy community brought up some real-life challenges in China, from Shanxi Province, a major coal-mining-heavy province - a socially just transition. How do we ensure that millions of coal-mining workers are not left behind? In Australia. there are about 50,000 workers in the coal-mining-related industries, China has more than 3 million. While China has to bear the disruption and duty on its own, complaints from Australia suddenly become so trivial. And more importantly, I hope that a strong signal from China is sent to Australia that let's end the fossil fuel age together and join hands to become leading forces to accelerate a climate resilient and clean future.