development scenario for Mexico (MEDEC), targeted at key emitting sectors such as energy, energy end-use and transport. According to the MEDEC study, more than half of industrial energy use is concentrated in three sub-sectors: cement, iron and steel, and chemicals and petrochemicals. While Mexico’s large-scale industries such as iron, steel and cement are among the most efficient, small and medium-sized enterprises accounting for a large part of the sector have high levels of energy intensity. The study recommends targeting energy efficiency improvements, for example in motor and steam systems or in kilns and furnaces, as well as co-generation, which may require change in the regulations on PEMEX (Mexico petroleum), a state-owned oil company (Johnson et al., 2009).

#### 4.3.3 China

In support of the Copenhagen Accord, China has set several voluntary targets for domestic actions, such as reducing $ CO_{2} $ emissions per unit of GDP by 40-45% from the 2005 level by 2020 and increasing the share of non-fossil fuels in primary energy consumption to around 15% by 2020. $ ^{24} $ Since the Copenhagen conference, China has started legislative work on domestic measures to achieve its commitments: amending the renewable energy law to promote wind and solar energy, increasing fines against utilities for failing to buy green energy or connect green sources to the grid and making a move towards incorporating the carbon intensity commitment into the next five-year plan. $ ^{25} $

China’s strategy to address energy and climate change has been outlined in its National Climate Change Programme published in June 2007 and the strategy has been internationally presented in a subsequent White Paper published in October 2008 (State Council of the People’s Republic of China, 2008). According to the 2009 progress report (National Development and Reform Commission, People’s Republic of China, 2009), the energy consumption per unit of GDP (energy intensity) has continued to fall, helped by a decline in energy intensity of the major energy-intensive industries (e.g. power supply, steel, chemicals, cement and aluminium) since 2005. China has harvested some of the lowest-hanging fruit in its early actions for energy efficiency improvements as follows.

The Top 1,000 Enterprises Programme was established in 2006. The programme sets a significant portion of the overall 20% energy-intensity target on China’s 1,000 largest state-owned enterprises, mostly in heavy industry, which accounted in 2005 for at least a third of the country’s total, primary energy demand and 47% of industrial energy demand (Seligsohn et al., 2009a). The programme contributed to two-thirds of the country’s energy efficiency gains in 2006 and half of the gains in 2007 (Price et al., 2008, as quoted in Seligsohn et al., 2009b).

The government also started a programme for the large-scale closure of many inefficient, small industrial plants. In 2008, China closed 16.3GW worth of small thermo-power generating units in 325 power plants, and plants with capacities for 53 million tons of cement production, 6 million tons of steel production and 14 million tons of iron production (National Development and Reform Commission, People's Republic of China, 2009).

From 2008, the government required all new coal-fire power plants built in China to use state-of-the-art, commercially available technology. Consequently, the majority of the world’s most