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elcamedia
CSR consultancy

CSR & Sustainability China
SUStainaBLE DEVELOPmEnt in China’s 12th Five Year Plan Elcamedia CSR Consultancy

Sustainable Development in China’s 12th Five Year Plan: An Executive Summary.
by Dr. Robin Porter Senior Consultant for China Projects, ElcaMedia CSR Consultancy Fmr. Counsellor for Science and Innovation at the British Embassy in Beijing

Copyright © 2012 ElcaMedia CSR Consultancy - Leading international agency for embedding CSR & Sustainability into an overall corporate strategy. Printed in the UK.

A wealth of opportunities

More than any other five year plan, China’s 12th Five Year Plan, 2011-2015, focuses on quality of life over quantity of GDP. It offers a wealth of opportunities for international companies to sell technology, equipment and consultancy to China in many ways. To help senior executives quickly get an overview of the strategic challenges and opportunities regarding CSR, we’ve compiled a summary of the CSR elements within the 105 page document: clearly listing the sustainable development actions planned by the Chinese Government. This 20-page summary comes from preliminary research carried out in the course of a larger project on the 12th Five Year Plan for the European Commission by our senior consultant for China projects, Dr. Robin Porter. To our knowledge, until now no such transparent document exists elsewhere. Covering the full spectrum of CSR from energy efficiency targets and lowcarbon development strategies to climate change and the creation of a ‘green’ economy, we expect it will provide valuable practical insights for any executive dealing with China.

© 2012 ElcaMedia CSR Consultancy - Leading international agency for embedding CSR & Sustainability into an overall corporate strategy

Key facts & figures

Key economic targets • Annual GDP growth: 7% • Increase urbanisation from 47.5% to 51.5% • Increase service sector contribution to GDP by four percentage points, from 43% to 47% • Increase spending on R&D to 2.2% of GDP • Hold inflation (CPI) at or below 4% per year Key non-economic targets • Increase non-fossil fuel use to 11.4% • Reduction of energy use per unit of GDP: 16% • Reduction of CO2 emissions per unit of GDP: 17% • Increase forest coverage by 21.66% • Decrease pollutants COD and sulfur dioxide by 8% each

Impacts of climate policy on business sectors: High

• • • •

Aluminium Cement Iron & Steel Chemicals

• • • • •

Agriculture Oil & Gas Airlines Transport Coal mining

Cost to reduce emissions

• Insurance • Banking & Finance • Retail • Renewables • Recycling

• • • •

Mining Utilities Property Automotive

Low

Low
Source: KPMG

Emissions Intensity

High

© 2012 ElcaMedia CSR Consultancy - Leading international agency for embedding CSR & Sustainability into an overall corporate strategy

Energy
The first group of issues under the broad heading of ‘Sustainability Development’ concerns China’s plans for energy under the 12th FYP. Specifically, these relate to her programme to increase energy efficiency, her low-carbon development strategy, and the actions to be taken to ensure energy security. Inevitably, there will be some overlap between these issues.

© 2012 ElcaMedia CSR Consultancy - Leading international agency for embedding CSR & Sustainability into an overall corporate strategy

Energy efficiency

The headline intentions for energy efficiency are essentially contained in chapters 11 and 22 of the 12th FYP. In chapter 11: a.) Promote and develop diversified and clean energy sources: • develop safe and efficient coal mines, and large coal enterprise groups • promote the integration of coal resources, and the merger and reorganization of coal mine enterprises • carry out R&D demonstrations of coal-based natural gas, coal- based liquid fuels and coal-based co-production, and promote their steady introduction • strengthen the exploration and development of petroleum and natural gas resources • stabilize domestic petroleum output, and promote the rapid growth of natural gas output • promote the development and utilization of unconventional oil and gas resources, such as coal-bed gas and shale gas • develop clean and efficient large-capacity coal-fired generating sets, giving priority to heat and power cogeneration units in large/ medium cities and industrial parks, large coal-fired power stations near coal mines, and integrated coal gangue power stations • develop hydropower actively on the precondition of proper ecological conservation and resettlement • focus on the construction of large-sized hydropower stations in southwestern China • develop medium and small river waterpower resources based on local conditions • plan and construct pumped storage power stations scientifically • develop nuclear power on a safe and efficient basis • strengthen the construction of grid-connection works, and develop wind power effectively • develop solar energy, bio-mass energy, geothermal energy and other new energy sources actively • promote the extended application of distributed energy systems

© 2012 ElcaMedia CSR Consultancy - Leading international agency for embedding CSR & Sustainability into an overall corporate strategy

b.)

Optimize the layout of energy development: • plan national energy development and construction priorities in a unified manner • construct five national integrated energy bases in Shanxi, the Ordos Basin, eastern Inner Mongolia, southwestern China and Xinjiang • develop nuclear power in the eastern coastal region and some areas in central China • improve the level of local energy processing and transformation, in order to reduce the pressure for large-scale and long-distance energy transmission • plan and construct energy storage facilities rationally, improve the petroleum reserve system, and strengthen the capacity of natural gas and coal reserve and peak molulation

c.)

Strengthen construction of energy transmission channels: • accelerate the construction of the strategic transmission channels for oil and gas produced in northwestern, northeastern, and southwestern China, and sea-imported oil and gas, and improve the domestic trunk oil and gas pipe network • make unified the planning of natural gas import pipelines, LNG receiving stations, and cross-regional trunk gas transmission and distribution networks • create a gas supply layout in which natural gas, coal-bed gas and coal-based gas are balanced • accelerate the building of a modern power grid system • further expand the size of west-to-east power transmission • improve regional trunk power grids • develop advanced large-capacity, high-efficiency and long- distance power transmission technologies to meet requirements for large-scale cross-regional power transmission, and grid connection of power generated from new forms of energy • promote the construction of intelligent power grids, strengthen urban and rural power grid construction and improvement, and improve the performance in terms of electricity supply and reliability of power grids, using advanced information technology, and control and energy storage technologies

ENERGY / energy efficiency
© 2012 ElcaMedia CSR Consultancy - Leading international agency for embedding CSR & Sustainability into an overall corporate strategy

In chapter 22, the following sections:

a.) b.)

Strengthen energy conservation management: • formulate and implement limits on energy consumption per unit of production in energy-intensive industries • formulate and implement energy efficiency standards for the end-use of energy-consuming products • strictly enforce the system for assessing and examining energy savings in investment projects Vigorously enforce energy conservation: • promote energy-saving conversion projects • undertake energy-saving projects that benefit the people • encourage projects which demonstrate energy-saving technologies in industry • promote energy performance contracting

ENERGY / energy efficiency
© 2012 ElcaMedia CSR Consultancy - Leading international agency for embedding CSR & Sustainability into an overall corporate strategy

Low-carbon development strategy

The headline intentions for a low-carbon development strategy are an integral part of the plans for energy, and are motivated in part by plans for protection of the environment. References are contained in chapters 2, 9, 21, 22 and 23 of the 12th FYP. In chapter 2, as previously indicated: • develop a circular economy and low carbon technologies In chapter 9, on improving and promoting manufacture: • implement exemplary projects of carbon dioxide utilization Introduction to part VI, green development: • establish green and low carbon development ideas In chapter 21, section 1, on controlling greenhouse gas emissions: • save energy and improve energy efficiency and increase forest carbon sinks • significantly reduce the intensity of our energy consumption and CO2 emissions • promote the planting of trees and forestation to increase the national forest-cover area to 12.5 million hectares • accelerate research, development and application of low carbon technologies • look into creating low carbon product standardisation, labelling and authentication systems • establish an effective system for calculating GHG emission statistics and gradually create a carbon emissions trading system • advance low carbon pilot projects In chapter 22, section 1 on boosting energy conservation: • roll out low-carbon energy-saving actions in ‘the 10 thousand enterprises’

In chapter 23, on developing a ‘circular’ economy: • encourage low carbon consumption models and lifestyles among the people and government

© 2012 ElcaMedia CSR Consultancy - Leading international agency for embedding CSR & Sustainability into an overall corporate strategy

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About ElcaMedia CSR Consultancy ElcaMedia CSR Consultancy is a leading international agency for embedding Corporate Social Responsibility (CSR) and Sustainability into an overall corporate strategy. We are the first company in the world with Cradle-to-Cradle certified consultants: a prestigious closed loop/ circular economy model. Corporate Social Responsibility provides significant opportunities to build long-term business value. ElcaMedia CSR Consultancy has proven experience of achieving ROI from CSR: developing clear steps for action helping international companies identify, adopt and implement CSR strategies throughout their organisations for the greater benefit of all stakeholders. These include the necessity for a sound operational CSR strategy, a specific environmental and social strategy for the identification and management of related issues, employee training programs, and best practice in the field of approach, reports and communication when it comes to presenting the business to the wider world - including China. About the author This publication was written by Dr. Robin Porter, ElcaMedia’s senior consultant for China projects. Robin is an academic China specialist and is currently Visiting Professor at the Centre for East Asian Studies, University of Bristol (UK). He has been adviser on China to a major industry and from 2002 to 2005 was Counsellor for Science and Innovation at the British Embassy in Beijing. Disclaimer All reasonable efforts have been made to ensure that the material presented here is accurate and reliable at the date of publication. However, the company and the author reserve the right not to be responsible for the topicality, correctness, completeness or quality of the information provided. Liability claims regarding damage caused by the use of any information provided, including any kind of information which is incomplete or incorrect, will therefore be rejected. Copyright © ElcaMedia CSR Consultancy www.elcamedia.com