CASE STUDY: CHINA

The document analyzes China's heavy reliance on fossil fuels, particularly coal, and the fiscal implications of this dependence. It details the structure of government revenues from fossil fuels, the influence of state-owned enterprises, and the prevalence of subsidies. While China has implemented policies to reduce coal overcapacity and peak emissions by 2030, it continues to provide significant subsidies and finance fossil fuel projects internationally through the Belt and Road Initiative.

• China's proved fossil fuel reserves are approximately 650 GtCO2, with coal comprising 96 per cent of this total. The combustion of these reserves alone would likely push global temperatures beyond 2°C and almost certainly beyond 1.5°C.
• Fossil fuels, predominantly coal, represent about 90 per cent of China's energy production and consumption. China is the world's largest coal producer and the most import-dependent major economy globally, with imports covering more than two-thirds of its oil consumption.
• In 2017, government revenue from the production and consumption of oil, gas, and coal was 1.2 per cent of GDP, representing 4.2 per cent of general government revenue. The majority of this income is derived from fossil fuel consumption rather than production.
• The Chinese government is exposed to asset stranding risks due to the dominance of state-owned enterprises (SOEs) in the sector. Of the 97 SOEs controlled by the Central Government, 23 have stakes in fossil fuels, including major entities like CNPC, Sinopec, and CNOOC.
• China's climate and energy goals include peaking carbon dioxide emissions around 2030 and increasing the share of non-fossil primary energy to 20 per cent by 2030. However, the document notes a contradiction: China continues to finance fossil fuel projects in other countries via the Belt and Road Initiative.
• Fossil fuel subsidies in 2017 were estimated by the OECD at 0.1 per cent of GDP (0.5 per cent of general government revenue). These include direct grants to SOEs, resource tax reductions, and exemptions such as the excise tax waiver for domestic aviation fuel.

APA

Kühne, K., & Roth, J. (2019). CASE STUDY: CHINA. International Institute for Sustainable Development. https://www.iisd.org/sites/default/files/publications/beyond-fossil-fuels-china.pdf

Chicago

Kühne, Kjell, and Joachim Roth. CASE STUDY: CHINA. International Institute for Sustainable Development, 2019. https://www.iisd.org/sites/default/files/publications/beyond-fossil-fuels-china.pdf.

Wikipedia

{{cite report |last1=Kühne |first1=Kjell |last2=Roth |first2=Joachim |title=CASE STUDY: CHINA |publisher=International Institute for Sustainable Development |date=November 2019 |url=https://www.iisd.org/sites/default/files/publications/beyond-fossil-fuels-china.pdf |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{khne2019case, author = {Kühne, Kjell and Roth, Joachim}, title = {{CASE STUDY: CHINA}}, institution = {International Institute for Sustainable Development}, year = {2019}, month = nov, url = {https://www.iisd.org/sites/default/files/publications/beyond-fossil-fuels-china.pdf}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }