China Briefing 6 August 2026: Five-year climate plan | ‘Overcapacity’ report | ‘Severe’ heatwave
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We handpick and explain the most important climate and energy stories from China over the past fortnight.
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Key developments
New climate-focused five-year plans
INDUSTRY PLAN: China published a five-year plan focused on “advanc[ing] the green and low-carbon transformation of its industrial sector”, reported state news agency Xinhua. It added that the plan “aims to significantly increase” industrial use of low-carbon energy, as well as strengthen competitiveness of clean-energy sectors. The plan outlines seven “major tasks”, said power news outlet BJX News, including peaking industrial emissions before 2030 and enhancing clean-energy innovation. Energy news outlet International Energy Net noted that the plan includes sector-specific policies, such as prioritising supply of scrap steel and low-carbon power to steel manufacturers using electric-arc furnaces. It said that the chemicals sector is encouraged to pursue the “orderly” use of low-carbon feedstocks.
POWER-SYSTEM PLAN: Meanwhile, China also published its five-year plan for a “new-type power system”, reported the Communist party-affiliated People’s Daily. [The plan is not to be confused with a similarly named plan for a “new-type energy system”.] It adds that the plan reiterates China’s goal of ensuring that “non-fossil energy accounts for 50% of total power generation” by 2030. The plan focuses on the need for a “secure and reliable” power system, reported BJX News. Finance news outlet Wall Street CN said key elements of the plan included strengthening grid infrastructure and “smart dispatch”, enhancing demand-side flexibility and improving institutional reforms – such as capacity payments.
OTHER ANNOUNCEMENTS: A five-year plan for preventing geological disasters pledges to strengthen China’s response to events such as landslides caused by “extreme rainfall”, reported Reuters. It added that a particular focus will be areas around hydropower dams. A new five-year plan for developing a meteorological observation system noted the need to “solidify the foundation for climate change monitoring”, said Xinhua. The government also published an action plan urging public institutions to accelerate energy efficiency and carbon-reduction efforts, such as by procuring electric vehicles, said BJX News. The July meeting of China’s Politburo, led by President Xi Jinping, resolved to progress with China’s carbon peaking and neutrality goals in a “proactive yet prudent manner”, according to Xinhua. [For China’s new climate-change five-year plan, see today’s Spotlight.]
China outlined position on ‘overcapacity’
POSITION PAPER: China’s commerce ministry published a report rebutting arguments that industrial “overcapacity” in its economy is disrupting global markets, according to Xinhua. It said the report instead argued that there is no link between subsidies and overcapacity, and that “high export volumes and a large trade surplus do not equate to overcapacity”. The Economist said the report refers to “so-called overcapacity”, adding that “so-called” is a “favourite epithet in the rhetorical armoury of Chinese officials facing unwelcome foreign criticism”. It added that the debate “speaks to a broader and more fundamental struggle” in which non-Chinese companies are up against a “whole-of-state approach to industry”, not just individual, competitive firms.
CLEANTECH ARGUMENT: The full text of the report specifically highlighted the global energy transition and China’s “enhanced economies of scale and innovation” as the reason for its export growth. It said that the size of its cleantech exports to Europe “reflects more than anything else” the strong demand for cleantech – and the impact of the “energy crisis” on European industries. It added that the energy transition is a shared global aspiration, with China’s high-quality and affordable products “contribut[ing] to achieving the targets set in the Paris Agreement”.
July saw record heat
HEAT DOME: In July, average temperatures in regions including Xinjiang, Sichuan and Chongqing “reached record highs”, reported Xinhua, with other reports of high temperatures in the north-east, eastern and central China. This led to a “rapid increase” in electricity demand in early August, driven by cooling demand, according to Reuters. The heatwave is amongst the “most severe and long-lasting” in recent years, reported CCTV, although it did not mention climate change as a factor. Weather Observer, a WeChat account focused on meteorology, noted that drivers included the formation of a “heat dome”, El Niño and a decline in Arctic sea ice. It added: “As global warming continues to intensify…we will only witness more climate records being broken.”
CLIMATE WARNING: Meanwhile, nearly 90,000 residents in the north-western province of Shaanxi and more than 920,000 residents in south-western province of Sichuan have been evacuated since mid-July due to “risks from heavy downpours”, said Reuters. This followed the evacuation of “hundreds of thousands of people in Guangdong province” when Typhoon Noul made landfall in late July, according to the Guardian. State media in the arid region of Ningxia celebrated the trend towards higher rains as a “heavenly fortune” that would bring “climate dividends”, reported the South China Morning Post. However, it cautioned, climate scientists “warn that romanticised narratives ignore the volatile reality of modern climate change”.
DISRUPTING PRODUCTION: The heat, flooding and typhoons “disrupted production and business activity”, pushing the purchasing managers’ indices for both manufacturing and services into contraction, reported finance news outlet Yicai. Meanwhile, China’s “corn, rice and cotton fields are at heightened risk of crop damage” due to elevated heat in the north and east of the country, said Bloomberg.
More China news
- LESS THAN HALF: “Coal-fired plants accounted for 49.7% of electricity output” in the first half of 2026, reported Bloomberg. It added that this marks the first time that less than half of China’s power has come from coal in the first six months of the year.
- ETS QUOTAS: China has published draft allocation quotas for its carbon market, covering the power, steel, cement and aluminum sectors, reported climate news outlet IdeaCarbon.
- ‘EASING’ ALLOCATION: The new draft rules would see coal power-plant allocations fall only 0.1% year-on-year, “easing” from a 0.85% reduction proposed in May, wrote ClearBlue’s Qin Yan on BlueSky.
- EV RULING: The World Trade Organization “ruled in China’s favour” in a dispute over Turkey’s restrictions on electric vehicles imported from China, said finance outlet Yicai.
- IMO INTERVENTION: China proposed new amendments to the International Maritime Organization’s net-zero framework supporting incentives for “green fuel” use and the possibility of a “Net Zero Fund”, said maritime news outlet Lloyd’s List.
- US BAN: The US has “banned imports of new foreign-made power inverters” used in clean-energy power systems, the “majority” of which are made in China, reported Yicai.
Spotlight
China releases five-year plan for climate change
China has released a five-year plan dedicated to addressing climate change for 2026-2030.
In this issue, Carbon Brief examines some of the notable elements in the plan and what it reveals about China’s policy direction through to 2030.
A full version of this spotlight has been published on the Carbon Brief website.
‘Unprecedented’ document
The Ministry of Ecology and Environment (MEE) released the plan in late July, in unison with 18 other government departments.
The document covers a range of topics, including CO2 emissions, other greenhouse gases (non-CO2 GHGs), carbon markets, carbon footprints, climate adaptation and international cooperation on climate change.
For the first time at the five-year plan level, the plan creates a comprehensive target system covering all areas of climate policy, said officials in a MEE Q&A. They described it as the “main policy instrument” for advancing China’s climate action during 2026-2030.
Qin Yan, principal analyst at ClearBlue Markets, told Carbon Brief that the plan shows that China’s climate governance has reached “an unprecedented strategic level”.
Nevertheless, several headline targets and policies in the document simply reiterate already established plans.
These include:
- Cutting carbon intensity by 17% across the five years
- Reducing carbon intensity per product in industries under China’s carbon market by 3%
- Substituting fossil fuels with renewables
- Strengthening climate adaptation
- Supporting the “free flow” of cleantech
Non-CO2 GHGs
The plan also goes into detail on China’s approach to non-CO2 GHGs. This includes reaffirming a target of an emissions “reduction capacity” from these gases totalling 30m tonnes of CO2 equivalent (MtCO2e) by 2030, although the baseline is unclear.
The goal refers to emissions reductions, which can be realised through implementing current non-CO2 emissions reduction policies and projects, says Chen Meian, programme director and senior analyst at the Institute for Global Decarbonization Progress (iGDP).
She adds that it is “relatively achievable”, for example by increasing the number of coal-mine methane utilisation projects.
In 2021, around 19% of China’s emissions were from non-CO2 GHGs (around 2,700MtCO2e) the majority of which was from methane, as shown in the figure below.
CHART
China’s plans to curb these super-pollutants in the five-year period include coal-mine methane utilisation projects, end-of-pipe destruction technologies for HFCs and guidance on the use of catalysts to reduce N2O emissions.
It also calls for the recovery and replacement of sulphur hexafluoride (SF6) – an F-gas that Chen noted received little policy attention until now – in power equipment.
‘New narrative’ for climate governance
One of the plan’s clearest objectives for international cooperation is for China to play a more active role in global climate governance.
By 2030, it says China should markedly increase its “influence, guiding power, shaping power and moral appeal” in this area.
China will also aim to “build a new narrative on climate governance”, it adds.
Prof Thomas Hale, a professor in public policy at the University of Oxford’s Blavatnik School of Government, writes on LinkedIn that the plan “marks a major rhetorical shift” towards China being increasingly willing to “lead and shape” global climate action.
Another clear focal point for international cooperation is in carbon markets.
The plan calls for China to expand the global influence of its carbon market, such as through international rule-setting, cooperation on standards and by hosting the China Carbon Market Conference.
Qin says China’s more active role in global carbon pricing is already evident in the launch of the open coalition on compliance carbon markets with the EU and Brazil. This coalition is expected to adopt a work plan at the China Carbon Market Conference in September.
Qin also notes that China “could become the world’s largest [carbon] offset buyer” as its energy transition progresses.
China would therefore “benefit from helping shape global rules under the Article 6 framework”, she adds.
This spotlight is by freelance China analyst Lekai Liu for Carbon Brief.
Watch, read, listen
DUAL CONTROL: China Talk broadcasted an interview with National Center for Climate Change Strategy and International Cooperation strategic planning director Chai Qimin on the “dual control of carbon” policy.
TRANSITION TURNOVER: Jiemian examined the high rate of executive turnover in China’s three major oil companies – and what it reveals about the energy transition.
ENERGY TRILEMMA: State broadcaster CCTV published an article on how China’s energy transition can show the world how to resolve the “energy trilemma” of security, affordability and sustainability.
TRACKING COAL: A new report from the Centre for Research on Energy and Clean Air and Global Energy Monitor found 30 gigawatts (GW) of new Chinese coal capacity came online in the first half of 2026.
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The number of new nuclear reactors approved by the State Council last week, reported finance news outlet Caixin. It said China is targeting 110GW of nuclear capacity by 2030, up from 63GW in 2025.
New science
- Implementing “energy efficiency upgrades” across urban buildings in China over 2020-50 would reduce overall electricity supply costs, largely offsetting initial investment costs | Nature Cities
- Temperature plays a “critical role” in influencing seasonal changes in atmospheric ozone levels, which should be accounted for when designing “long-term ozone pollution mitigation strategies” | Nature Geoscience
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China Briefing is written by Anika Patel, with contributions from Lekai Liu and Amy Rushton. It is edited by Simon Evans.
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