Legal framework and practice for environmental protection and application of green energy in China

ABSTRACT

In terms of the Chinese legal framework and practice on environmental protection, China evolves itself from basic control to systematic surveillance and from ‘belittlement’ to ‘coerciveness’; the complexity of the legal framework on energy application in China has been developed from rudimentary legislations on fossil resources’ utilisation to an entrenched design of legislative and policy instruments that is more emphatic towards green energy promotion. Today, under the influence of European experiences, China is carrying out a huge number of legal measures to realise the systematic coordination between environmental protection and energy application. Such coordination in China has primarily been ruled by state policies, rather than national legislations.

KEYWORDS:

• Green energy
• environmental protection
• law of renewable energy
• solar energy
• wind energy

Disclosure statement

No potential conflict of interest was reported by the authors.

Notes

1. For a general introduction to the development of Chinese Legal Framework, see, Cheng 2009; MCElwee, 2011; Zhang 2016.

2. For the analysis on Chinese multilayered governance system, see Monti.

3. See §5, Article 1, Decision of the State Council on Implementing a Scientific Outlook on Development and Strengthening Environmental Protection (2005) [, (2005)39 ]

4. See, §2 (2), Article 1, Notice of the Ministry of Environmental Protection on Issuing the General Planning for the Development of Environmental Protection Legislation and Environmental Economic Policies in China during the 12th Five-Year Plan Period. Document No.129, 2011 of the Ministry of Environmental Protection. [ , (2011)129 ]

5. To follow consensus, green energy in this article is equal to renewable energy. It is important to note that, even green energy promotion itself still involves some externalities. Such as wind power installments are likely to incur ecological concerns, so do with dams that built for hydropower. However, generally green energy promotions create less pollution (includes carbon emission) compared with fossil resources.

6. Zhao (2014) introduced four types of policy instruments that were generally used in Solar PV power generation field: (1) Command and Control; (2) Economic Incentive; (3) Public Participation; and (4) Market Creation. We do not share the author’s view on these four types instruments’ categorisation. In part, because types (3) and (4) are inherently market-based instruments themselves, they share the same character as type (2). Based on this point of view, we separate the policy instruments into two categories: (1) Command and Control; and (2) Market-based instrument, which are presented in the article.

7. Art. 14 of the 2009 Renewable Energy Law describes in detail this new system, saying that ‘the energy department of the State Council shall, together with the State Electricity Regulatory Commission and the public finance department of the State Council, and according to the national plan for the development and utilisation of renewable energy resources, determine the target proportion, which shall be realised in the planning period, between the electricity generated by using regenerable energy resources and the total electricity generated and work out the specific measures for power grid enterprises to firstly schedule the generation of electricity with renewable energy resources and purchase electricity generated by using renewable energy resources in full amount. The energy department of the State Council and the State Electricity Regulatory Commission shall urge the implementation of such measures in the planning years.'

8. See, Ministry of Finance, State Administration of Taxation and Ministry of Industry and Information Technology, ‘Tax Exemption Announcement on Purchasing New Energy based Automobiles’, Announcement No. 53 (2014) [ ( 2014 53 )]

9. See, Beijing Municipal Bureau of Finance, Municipal Commission of Economy and Informatization, and Municipal Commission of Science and Technology, ‘Notice on Issuing Management Rules (Amended) of Financial Subsidies to Model New-Energy-applied Passenger Automobiles’ (No. 521, 2016) and ‘Notice on Financial Subsidies Policy (Amended) for Popularizing Pure Electric Passenger Car’ (No. 522, 2016) [ (❲2016 ❳ 521 ); (❲2016❳522 )]

10. Lorusso (2016) pointed out that

the first barrier to integration of renewable into the Chinese power system is then represented by segmentation of the transmission grid and weak interconnections between different regions of the country, though this is not the only one. The impact of renewables variability is even intensified by the lack of sufficient balancing options.

11. Feed-in Tariff, though often treated as a command measure by pro-market economist, in fact performs an imperative function in China’s green energy industry due to China’s own special institutional settings, of which traditional energy industry has very intricate relationships with governmental bureaucracy. And to stimulate the green energy industry, the Chinese government has to be in favour of green energy, rather than leave it to market liberalisation. See, Yan et al. (2016).

12. Article 29 of Renewable Energy Law (2009) states that

Any electricity grid enterprise violating Article 14 hereof by failing to purchase the full amount of electricity generated by using renewable energy and thus causing economic losses of the relevant power enterprise shall be liable for such losses and be ordered by state power regulatory authorities to make corrections within a specified time limit and, if it refuses to make corrections as required, be given a fine not exceeding the amount of the losses suffered by the relevant power enterprise.

13. See General Department of National Energy Administration, ‘Notice on Carrying Out Wind Power Solar PV Power Generation Absorption Supervision and Investigation’ (No. 251, 2013) [ , ❲2013❳251 ]; see also National Energy Administration, ‘Notice on Establishing Monitoring and Warning Mechanism to Strengthen Continue Health Development of Wind Power Industry’ (No. 196, 2016). [ , [2016]196 ].

14. See NDRC, ‘China 2050 High Renewable Energy Penetration Scenario and Roadmap Study.’ Accessed January 20, 2017. http://www.rff.org/events/event/2015-04/report-release-china-2050-high-renewable-energy-penetration-scenario-and.

15. See Central Committee of CPC and State Council, ‘Decision on Winning the Fight Against Poverty’ (2015) [ , 2015 12 ]

16. See National Energy Administration and the State Council Leading Group Office of Poverty Alleviation and Development, ‘Notice on the First Cycle PV Poverty Alleviation Program’ (No. 280, 2016) [ [2016] 280

17. See § 2, Article 4, Measures of Shanghai Municipality for Special Fund Support in Renewable Energy Development and New Energy Development (2016) [ , 2016 )

18. See § 1, Article 5, Measures of Shanghai Municipality for Special Fund Support in Renewable Energy Development and New Energy Development (2016) [ , 2016 )

19. See State Council, ‘Several Opinions on Promoting Health Development of Photovoltatic Industry’ (2013) [ , (2013) 24 ]

20. See National Energy Administration, ‘2015 PV Industry Development Facts.’ Accessed April 29, 2017. http://www.nea.gov.cn/2016-02/05/c_135076636.htm.

21. See National Energy Administration, ‘2016 PV Industry Development Facts.’ Accessed April 29, 2017. http://www.nea.gov.cn/2017-02/04/c_136030860.htm.

22. See National Grid Company, ‘Opinion on Promulgating the Work of Distributed PV Power Generation Grid Access Service’ (2012) [ (2012)]

23. See, §2, Article 4, ‘Regulatory Measures for Grid Enterprises’ Full Purchase of Renewable Energy Electricities’, issued by State Electricity Regulatory Commission on 17 July 2007. [ , 2007 ] Although the State Electricity Regulatory Commission is closed down, and its power is incorporated into the National Energy Administration, the Feed-In Tariff rule that according to grid companies' coverage, however remains unchanged.

24. See NDRC, ‘Notice on Complementing Solar PV Generated Electricity Grid-Connected Price Policy’, No. 1594 (2011). [ , (2011) 1594 ]

25. See NDRC, ‘Notice on Complementing Grid-Connected Benchmark Price Policy on Land Wind and Solar PV Generated Electricity’ , (2015)3044 ].

26. Measures of Shanghai Municipality for Special Fund Support in Renewable Energy Development and New Energy Development (2016) [, 2016 )

27. National Energy Administration, ‘2015’s First Half-Year National Wind Power Grid-Connected Operation Facts.’ Accessed March 20, 2017. http://www.nea.gov.cn/2015-07/27/c_134451678.htm.

28. See State Council, ‘Thirteenth Five-Year Plan for Energy Development.’ issued on 17 November 2016.

Additional information

Funding

This paper was funded by the research grant People Program (Marie Curie Actions) of the Seventh Framework Program, European Union FP7/2007-2013/under REA Grant agreement no.318908.