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56–971 PDF 2010

TRANSPARENCY IN ENVIRONMENTAL PROTECTION 

AND CLIMATE CHANGE IN CHINA 

ROUNDTABLE 

BEFORE THE

CONGRESSIONAL-EXECUTIVE 

COMMISSION ON CHINA 

ONE HUNDRED ELEVENTH CONGRESS 

SECOND SESSION 

APRIL 1, 2010 

Printed for the use of the Congressional-Executive Commission on China 

( 

Available via the World Wide Web: http://www.cecc.gov 

(II) 

CO N T E N T S 

Page 

Opening statement of Charlotte Oldham-Moore, Staff Director, CongressionalExecutive Commission on China ........................................................................ 1 

Brettell, Anna, Senior Advisor, Congressional-Executive Commission on 

China ..................................................................................................................... 3 

Finamore, Barbara, Founder and Director, China Program, Natural Resources 

Defense Council .................................................................................................... 4 

Gordon, David, Executive Director, Pacific Environment .................................... 7 

Seligsohn, Deborah, Senior Advisor, China Climate and Energy Program and 

Advisor, Climate Change and Energy Network, World Resources Institute .. 9 

Wara, Michael, Assistant Professor, Stanford University Law School ............... 11 

APPENDIX 

PREPARED STATEMENTS

Finamore, Barbara .................................................................................................. 27 

Gordon, David .......................................................................................................... 35 

Seligsohn, Deborah .................................................................................................. 38 

(1) 

TRANSPARENCY IN ENVIRONMENTAL PROTECTION AND CLIMATE CHANGE IN CHINA 

THURSDAY, APRIL 1, 2010 

CONGRESSIONAL-EXECUTIVE

COMMISSION ON CHINA, Washington, DC. 

The roundtable was convened, pursuant to notice, at 2:04 p.m., 

in room 628, Dirksen Senate Office Building, Charlotte OldhamMoore, Staff Director, presiding. 

Also present: Anna Brettell, Senior Advisor, Congressional-Executive Commission on China. 

OPENING STATEMENT OF CHARLOTTE OLDHAM-MOORE, 

STAFF DIRECTOR, CONGRESSIONAL-EXECUTIVE COMMISSION ON CHINA 

Ms. OLDHAM-MOORE. Welcome. I’m so pleased to see the substantial crowd we have today. 

Welcome to the Congressional-Executive Commission on China’s 

[CECC] panel on ‘‘Transparency in Environmental Protection and 

Climate Change.’’ 

For those of you who have not been to our Web site, I encourage 

you to visit it at www.cecc.gov. The Commission posts daily analysis, and one can sign up to the Commission’s subscription list. The 

Commission releases a monthly brief on rule of law and human 

rights developments in China and conducts hearings and 

roundtables. The Commission also issues an annual report on rule 

of law and human rights development in China, which is released 

in October. So, please do visit our Web site. 

The CECC, today, has convened a panel of experts who will discuss 

government transparency in the areas of environmental protection 

and climate change in China. China has stated commitments to 

improve access to environmental and climate change data. These 

commitments include China’s passage of the Open Government Information regulations in 2008, its revision of the People’s Republic 

of China’s statistics law in 2009, and its acceptance of the Copenhagen Accord in December 2009. 

The question before us is whether there are mechanisms in place 

that encourage transparency so that one can determine whether 

China is indeed meeting its stated commitments. Chinese leaders 

have, since the 1990s, gradually increased the public availability of 

a wide array of data in the environmental protection sector. 

Access to environmental data is a cornerstone of public participation and for ensuring enforcement of environmental laws. Public 

participation and demands for a cleaner environment are imporVerDate Mar 15 2010 10:15 Nov 23, 2010 Jkt 000000 PO 00000 Frm 00003 Fmt 6633 Sfmt 6633 U:\DOCS\56971.TXT DEIDRE
2 

tant because they are typically necessary for any country to achieve 

environmental protection goals. 

China’s environmental groups—some closer to the government 

than others—have increased in numbers since the late 1990s and 

have become more effective advocates and more active in using the 

law to obtain environmental information, and they do this with an 

eye toward improving enforcement of environmental laws and promoting more progressive policies. 

As citizens and environmental groups increase their monitoring 

activities, access to information becomes increasingly important. 

Questions remain, however, regarding the information available to 

these groups and to ordinary citizens in China, especially at the 

local levels. 

In relation to climate change, China, among other promises, has 

pledged to endeavor to ‘‘lower its carbon dioxide emissions per unit 

of GDP [gross domestic product] by 40–45 percent by 2020, compared to its 2005 levels.’’ 

This pledge to cut China’s carbon intensity is closely related to 

its previous commitments to decrease its energy intensity, and 

that’s the amount of China’s energy consumed per unit of GDP. In 

China, energy accounts for 85 percent of China’s carbon emissions, 

so discussions about transparency in measuring and reporting China’s carbon emissions is largely, although not solely, a discussion 

about transparency and energy data. 

Since concerns about the reliability of China’s energy data surfaced in the late 1990s and again in the early 2000s, China has 

tried to improve its systems for energy and climate data measurement, collection, and reporting. China also has agreed to participate 

in several cooperative programs to establish principles for improving data transparency and for developing a system to measure and 

report on all of its greenhouse gas emissions to the international 

community. 

We are very fortunate to have a distinguished group of panelists 

who will discuss transparency in the environmental protection and 

climate change sectors from different perspectives. Barbara Finamore 

will open with a general overview of access to environmental information in China and China’s environmental Open Government Information efforts, and discuss the relevance to implementation of 

China’s climate and other environmental targets. 

David Gordon will discuss the role of environmental groups in 

monitoring China’s environmental performance and actions to address climate change. 

Debbie Seligsohn will briefly introduce China’s systems for measuring, monitoring, and reporting energy and climate data. She will 

then discuss the implementation of these systems, highlighting remaining gaps and foci of capacity-building efforts. 

And Michael Wara, who has traveled from the west coast to the 

best coast, will discuss transparency issues in relation to energy 

projects in China that generate carbon credits for foreign investors. 

He will also discuss China’s implementation of international Clean 

Development Mechanism [CDM] guidelines. 

We are grateful that all of you have been able to join us today. 

3 

I want to briefly introduce Dr. Anna Brettell. She is our senior 

advisor on these matters, and will introduce the panelists with 

more detail. 

Thank you. 

STATEMENT OF ANNA BRETTELL, SENIOR ADVISOR, 

CONGRESSIONAL-EXECUTIVE COMMISSION ON CHINA 

Ms. BRETTELL. Great. I’d like to start with Barbara Finamore. 

She’s the Founder and Director of the China Program at the Natural Resources Defense Council [NRDC]. She leads NRDC’s 25- 

member staff in Beijing, who work on a number of projects that 

focus on climate change, energy efficiency, green buildings, advanced energy technologies, open information, environmental law, 

public participation, environmental health, and responsible 

sourcing. 

She has held several positions in the U.S. Government, and also 

the United Nations’ Environment Program. She has been the president and chair of PACE [Professional Association for China’s Environment], and is the co-founder and president of China-U.S. 

Energy Efficiency Alliance, which is a nonprofit organization that 

works on public-private partnership projects in China to reduce its 

greenhouse gas emissions. Ms. Finamore has had over 20 years experience working on China’s environmental issues. 

David Gordon serves as the executive director of Pacific Environment, an NGO that’s based in California. They work with grassroots organizations in China, Russia, Alaska, and California. They 

help communities have a larger voice in environmental decisionmaking. 

Mr. Gordon has helped Pacific Environment partner with Chinese groups since the mid-1990s. They have especially supported 

groups across China—all across China—to address issues of water 

pollution, environmental health, and marine conservation. 

Deborah Seligsohn is the senior advisor to the World Resources 

Institute’s [WRI] China Climate and Energy Program, as well as 

the advisor to WRI’s Climate and Energy Network, chinafaq.org. 

Her focus is on deepening research collaboration and the development of policy tools to address climate change issues. She has also 

had experience in the U.S. State Department, working in several 

countries including India, Nepal, and New Zealand. Her most recent position was as the Environment, Science Technology, and 

Health Counselor on Beijing. 

Michael Wara, or I should say Dr. Wara, is an Assistant Professor at Stanford University Law School, where he teaches environmental law and policy, and also international environmental 

law and property. His research focuses on the emerging global market for greenhouse gases in the post-Kyoto regime for reducing 

their emissions. 

His research includes a focus on the carbon credit market in a 

number of countries, including China. He has testified before a couple of House committees in the past about carbon offsets. 

So, I look forward to listening to everyone’s testimony. So, Barbara? 

4 

STATEMENT OF BARBARA FINAMORE, FOUNDER AND DIRECTOR, CHINA PROGRAM, NATURAL RESOURCES DEFENSE 

COUNCIL 

Ms. FINAMORE. Thank you very much, Charlotte, and thank you, 

Anna. It’s my pleasure and honor to be here with all of you today. 

I’m delighted to see so many of you in the room to discuss these 

very important issues, because my 20 years of experience in China 

and 10 years before that in the United States have convinced me 

of the fundamental importance of public access to information on 

energy and environment as a key method for improving environmental performance, whether it be conventional pollutants, energy 

intensity, or climate change reduction. 

Like many other countries—like the United States in fact, when 

I started doing environmental law in the United States—China has 

begun to realize, in an ever-increasing manner, that open access to 

environmental information is a way to bring in a variety of stakeholders to help with the process of improving enforcement of its 

environmental laws and policies. Also, it’s a way to relieve the 

pressure on the already extended Ministry of Environmental Protection [MEP] and local environmental protection bureaus, and in 

fact to improve the quality of the information that is available. 

Of course, as you heard from Charlotte, the really key development was in May 2008, when the State Council passed its first 

equivalent freedom of information act, its Open Government Information regulations. 

Now, this came after about a decade of experimentation, with everything from the Green Watch program, which I was able to be 

involved in through PACE that had a color-coded method for rating 

factories’ environmental performance, to provisions for allowing the 

public to comment on environmental impact assets and appear at 

hearings on certain environmental impact projects. 

But this Open Government Information Regulation was really 

sweeping, applying to every government agency. Every government 

agency was, in turn, supposed to develop its own implementing regulations. The Ministry of Environmental Protection was the first 

out of the box. They came out with their own implementing regulations almost immediately after the State Council issued theirs. 

Only a few other government agencies in China have followed 

suit, so that’s the first area I just wanted to mention. There is 

room for improvement here for many other agencies to follow the 

good example of the Ministry of Environmental Protection in developing their implementing regulations. That’s what I’m going to 

focus on, just very briefly. 

The Ministry of Environmental Protection regulations require 

government environmental agencies, from the central government 

down to the provincial and local levels, to proactively provide all 

sorts of environmental information to the public and to respond to 

requests for such information. 

It ranges from everything from how many permits they’ve issued, 

how many environmental impact assessments they have issued, 

what the impacts are, environmental statistics, environmental 

quality information, what letters of complaint or requests for information they’ve received from the public, all the way to information 

such as a list of violator companies that are way above their emisVerDate Mar 15 2010 10:15 Nov 23, 2010 Jkt 000000 PO 00000 Frm 00006 Fmt 6633 Sfmt 6633 U:\DOCS\56971.TXT DEIDRE
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sion standards, what lawsuits have been brought for administrative penalties, and what have the resolutions been. 

There is a time limit on responding, but typically within 15 days. 

There are exceptions, just like in our Freedom of Information Act, 

for things like state secrets, privacy, and commercially sensitive information, and there is a provision for appeal. This all is quite progressive, I think, and for those who have been working in China 

a long time, quite a surprise that this was implemented on a national level. 

I’m sure you are all aware that information is at a premium in 

China, to say the least, so this was a very important step forward. 

But of course, the key is always: how are these regulations being 

implemented, how are they being enforced, what kind of information is being revealed? 

NRDC, very soon after the Ministry of Environmental Protection 

and the State Council issued their regulations and measures, 

began a project with the Institute for Public and Environmental Affairs, Ma Jun’s organization, whom I’m sure many of you know, to 

really track the progress at the municipal level, and we’ll continue 

to do so. What we found was, basically, low levels of compliance 

overall, but very bright spots in each of the eight key areas that 

we did measure. 

In fact, we discovered some really amazing, creative, and innovative ways that certain cities were implementing certain parts of 

these regulations, from searchable databases where people could go 

online and pick a point source, a polluting factory, and target and 

track its emissions, to things like putting on the Web site hourly 

monitoring readings of pollution levels. Other cities were very good 

at responding to requests for information and others were very 

forthcoming to talk about all the lawsuits and administrative proceedings that were being brought. No one city did a very good job 

on everything. 

But what we’re trying to do is similar to something that NRDC 

has been doing for many years in the United States. We publish 

an annual report on the conditions of our nation’s beaches, in terms 

of certain pollutants. The first year we did that report, it was very 

bad all across the board. But the name and shame value was invaluable, and right away cities took action, beach communities took 

action to improve their performance for the next year because they 

wanted the tourists to come back. 

We’re already seeing that happen in China. Cities are looking at 

the performance of other cities and saying, ‘‘I didn’t realize we had 

to do that,’’ or ‘‘I didn’t realize we could do that,’’ or ‘‘I’d better do 

that, and if I do it’s going to be safe, I’m not going to get into some 

kind of political trouble.’’ So we will continue to do this year after 

year, and we are already getting inquiries from cities about each 

other. We’re bringing cities together to discuss China’s own best 

practices, and hope to foster them. 

But there are obstacles to greater compliance. They’re very similar to what we see in many other instances on environmental energy regulations: lack of capacity on the part of local officials who 

don’t understand what to do or how to do it; the vagueness in the 

regulations. 

6 

Still, I’m happy to say that the Supreme Judicial People’s Court 

has issued a draft judicial interpretation to clarify how these regulations should be followed, what is the scope, and what is the scope 

of the exemptions. They even ask for public comment on their draft 

judicial interpretations, so we hope that will provide more clarity. 

Most important, how well are local officials going to be held accountable for their failings to comply with the regulations? 

Just really briefly, I’d like to provide four suggestions for ways 

in which the United States can help to promote China’s efforts toward greater transparency in this, and other, areas. One—and this 

is already going on but it can be continued and strengthened—exchanges on the issues relating to, how do you set up the rules of 

the system, how do you refine the laws and the rules for environmental information disclosure? The United States has much depth 

of experience in this area that it can, and is, and hopefully will continue to, share. 

Number two, the United States and China, as I’m sure many of 

you know, are already involved in a very large number of international exchanges and partnerships on all kinds of environmental 

and energy issues. One thing we hope will happen going forward 

is an effort to build into these partnerships, these projects, and 

these collaborations, efforts to ensure or to improve the release of 

information that’s generated through these projects to the public, 

and also to develop the capacity of the local officials to make that 

information available. 

Third, given the interdependency of our two economies and the 

increasing demand for information on the part of U.S. consumers 

and businesses on the environmental impact of the goods that they 

purchase, we think there is tremendous opportunity here for collaboration on approaches to greening the supply chain of U.S. industries. This benefits the consumers, gives Chinese environmental 

authorities support of powerful business allies, and ultimately 

helps to bring about a cleaner environment. 

Finally, as we begin to look at how China is going to meet its 

climate commitments, we think there is tremendous room here for 

technical, non-political exchange between the United States and 

China on approaches on how to improve the methodologies relating 

to greenhouse gas emissions monitoring and verification. This is already going on: there is a memorandum of understanding between 

the U.S. Environmental Protection Agency and China’s equivalent, 

Ministry of Environmental Protection, which has been going on for 

years. But again, this is an area we think is very fruitful and we 

hope it will be continued and strengthened. 

I’ll stop there. I look forward to our discussion and your questions. Thank you very much. 

[The prepared statement of Ms. Finamore appears in the appendix.] 

Ms. OLDHAM-MOORE. Thank you, Barbara. 

Please, David. 

STATEMENT OF DAVID GORDON, EXECUTIVE DIRECTOR, 

PACIFIC ENVIRONMENT 

Mr. GORDON. Thank you very much. Thank you for the opportunity to provide comments to you today, and to the Commission 

for organizing this wonderful discussion. 

7 

Pacific Environment has worked in China for over 15 years, assisting local environmental organizations to grow a mature environmental movement that is effective at working together with the 

Chinese Government to address the most pressing environmental 

issues affecting China’s development path. 

The majority of our work in China has focused on water pollution 

issues and strengthening local non-governmental organizations to 

effectively work with local government agencies to address these 

critical issues. The lessons we’ve learned through these efforts have 

relevance to questions of transparency and environmental protection and can also help us understand how to promote transparency 

in dealing with climate change issues in China. 

One of China’s most critical environmental problems, as probably 

most people in the room know, is water pollution. In 2005, Chinese 

governmental officials indicated that over 360 million rural Chinese lacked access to clean drinking water, and over 70 percent of 

lakes and rivers are polluted. Major pollution incidents happen on 

a near-daily basis. 

Now, I do want to point out, this is not meant to single out China 

for these problems. These are similar problems that have been 

dealt with in other parts of the world, including here in the United 

States, and that will be one of the key points of my talk, is that, 

in fact, many of the challenges that are being faced in China 

around transparency and around environmental governance are the 

same challenges that we face here in the States, and that offers 

some opportunities for collaboration and learning from each other 

on these issues. 

We believe that improvements on issues such as water pollution 

will only be successful and sustainable if local, regional, and national environmental groups are able to establish themselves as 

strong watchdogs of, and advocates to, the government and private 

business and partner with them to find solutions. 

Working with many partner and environmental groups across 

China, we’ve reached out to local communities concerned about 

water pollution, helping them to conduct public relations campaigns, reach out to the media, reach out to the government to find 

ways to make a difference. What’s important to note is that the 

Chinese Government has recognized the significant nature and the 

severe nature of these issues. 

There’s been a noticeable shift in behavior by the Chinese Government as it pertains to environmental issues, particularly water 

pollution, as they’ve acknowledged that the environmental crisis, 

particularly for water, is coming earlier than expected. In this regard, they have looked to non-governmental organizations [NGOs] 

at the local and regional levels to help them address some of these 

issues. 

Barbara did a wonderful job talking about the open government 

regulations and the ways that environmental groups are starting 

to use this transparency in environmental information to understand how to gather information about water pollution issues, so 

I’ll skip over part of my testimony, with one comment that again 

this is very similar to the experiences that we have gone through 

here in the United States with the development of the Freedom of 

Information Act. 

8 

In the United States, years of precedent-setting litigation was 

required to ensure quality implementation of the Freedom of Information Act, and while we hope that a similar process is not required in China, I think we need to recognize that it will take time 

to build strong and transparent environmental governance and 

that there are ways that we can work together to do that to help 

ensure public trust in government information. 

I’d like to comment on one important model where the transparency of government information has been used to create some 

very real environmental improvements. In this model, the Institute 

of Public and Environmental Affairs [IPE] in China has made great 

progress using open government data to publicize pollution sources 

through a national water pollution map. IPE then works collaboratively with business, government, and local NGO representatives 

to encourage third-party audits of polluting factories that can make 

recommendations for pollution reduction. 

This model demonstrates how Chinese civil society can use publicly available information produced by the government to achieve 

environmental progress. IPE has now expanded its model to tackle 

air pollution issues, with evident applications within a climate 

change context. 

So one of the critical questions that we’ve been asking is: how 

can the lessons learned from civil society’s efforts against water 

pollution in China also be applied to climate change issues? We believe that public transparency of environmental information is a 

critical underlying component to appropriate and effective measurement, reporting, and verification [MRV] of climate change mitigation efforts. 

Just as in water pollution, the Chinese Government has made a 

number of significant and encouraging statements about reducing 

greenhouse gas emissions, and we’ve already heard about some of 

these. A critical part of working with China on climate change 

issues is empowering China’s civil society and environmental organizations. With the right information and tools, communities 

throughout China can advocate for better energy choices. Civil society organizations can encourage provincial and industrial leaders 

to reduce greenhouse gas and other pollutant emissions. 

In the United States, we have seen similar actions at the local 

and state levels that have been remarkably successful in developing greenhouse gas emissions reduction strategies. Indeed, the 

shift to local- and state-level strategies represented an enormous 

breakthrough in the United States from shifting awareness into action on climate change issues, and we’ve seen some of the most innovative efforts developed at the city and state levels. In China, 

provincial-level strategies also have the potential to build local action around as yet unimplemented central government policies. 

During the Copenhagen negotiations in December, concerns were 

raised about China’s willingness to accept MRV requirements suggested by developed countries, including the United States. These 

concerns, I think we have to recognize, came about as a result of 

a fundamental lack of trust in official government statistics and action in China. These concerns are real and we need to find ways 

to address those. But China also raised a number of valid concerns 

9 

in its own right about how international MRV requirements can become an intrusion on its own sovereign rights. 

So I’d like to suggest that there could be other ways that we can 

approach the MRV efforts, and that is to strengthen multiple systems within China that will verify data and information, and especially strengthen local systems within China. If these are systems 

developed within China, then this avoids the very tricky problem 

of intruding on sovereign rights. 

A critical component to a healthy MRV system anywhere in the 

world, including here in the United States, is a healthy and independent civil society sector. A healthy and independent civil society 

sector can help ensure that the government provides and acts upon 

accurate information, that the sector can help partner with all levels of government to find environmental solutions. 

So in conclusion, I would just like to say that we’ve seen a significant amount of progress in the last five years on water pollution 

efforts within China. We’ve seen civil society organizations, at the 

Beijing level and at the provincial level, start to make real progress 

in working together with local government agencies to shut down 

the most egregious polluting factories and to improve quality and 

standards at other factories. Over the long run, we’ll see that this 

creates a lot of very important public health benefits within China. 

I think the question we can ask today is, how can we take these 

lessons of how civil society organizations have helped to engage 

productively within China to partner well with the government, 

and how can we apply these lessons to climate change issues? The 

conclusion I’d like to leave you with, is I think there is a very large 

area for collaboration in strengthening the civil society sector, 

which in turn will help build an international public trust of government information within China. 

Thank you. 

[The prepared statement of Mr. Gordon appears in the appendix.] 

Ms. OLDHAM-MOORE. Thank you, David Gordon. We appreciate 

your remarks. 

Deborah Seligsohn, please. 

STATEMENT OF DEBORAH SELIGSOHN, SENIOR ADVISOR, 

CHINA CLIMATE AND ENERGY PROGRAM AND ADVISOR, CLIMATE CHANGE AND ENERGY NETWORK, WORLD RESOURCES 

INSTITUTE 

Ms. SELIGSOHN. Thank you very much, Charlotte. I’m delighted 

to be here today to discuss China’s efforts to measure, monitor, and 

report on energy and climate data. 

Over the last three decades, I’ve actually lived in China for more 

than 16 years. I was first a Foreign Service Officer, and then I’m 

now the Senior Advisor to the World Resources Institute’s China 

Climate and Energy Program. 

Part of my work involves helping Chinese universities, companies, and government agencies develop better ways of collecting 

and analyzing energy and pollution statistics. I’d like to outline 

just four main points right now. All of these are covered in much 

more detail in my written testimony. 

First, what the United States and other countries need to assess 

the success of the Copenhagen Accord is national-level information. 

10 

We have that from China. In fact, China’s overall energy and environmental data are quite strong by developing country standards. 

Over the last decade, the aggregated national-level numbers have 

become increasingly dependable. There are a couple of reasons for 

this. One, is that China does a very good job in tracking big energy 

producers and users. It pays close attention to companies like 

Huaneng, which is the world’s second largest power producer, and 

to the biggest coal, steel, and petroleum companies. 

Another reason is the majority of China’s energy is consumed in 

its developed eastern provinces. They import their energy either 

from other provinces or internationally. Anything that moves 

across a boundary in China is captured more effectively in the statistics. These provinces have the money and the manpower to 

maintain strong statistical information systems. As a result, the 

provinces with the highest energy use have the best data. 

Finally, the National Bureau of Statistics aggregates data from 

companies and from local and provincial governments. This allows 

the number-crunchers in Beijing to crosscheck and correct their figures. It becomes pretty obvious, for example, if power companies 

report burning more coal than the mining companies say they produced. 

The system is not perfect. There are still problems with accuracy, 

timeliness, and transparency, but there is now a standardized system for issuing corrections, as we also have in the United States. 

Here is an example of how this system works. In the early part 

of this decade, the China Statistics Bureau noticed a deep dip in 

coal consumption that did not align with other economic indicators. 

They fixed that problem and then issued revisions for prior years. 

In 2007, we saw another example of this increased reliability. 

International observers mistakenly thought the Chinese had 

misreported a steep decline in electricity use after the global financial crisis. In fact, the statistics were right, as later confirmed by 

industrial output numbers. 

This brings me into my second point. At the national level, China’s energy statistics are already a robust indicator of its greenhouse gas emissions. Some three-quarters of China’s emissions 

come from energy use. This is important because China’s national 

commitment reported under the Copenhagen Accord is to control 

energy-related carbon dioxide emissions. So for the moment, we’re 

not focusing on China’s emissions from farming or chemical processes or other complexities. 

The bottom line is that we can be confident that we are getting 

a good idea of how China’s energy emissions are changing just by 

looking at the overall numbers. 

My third point is that China is spending a lot of time and money 

to improve data collection systems. This will allow the government 

to better understand how specific policies and programs are affecting energy use and emissions. We know that over the last four 

years China has improved its energy intensity, in other words, the 

amount of energy used per unit of economic output. We also know, 

from detailed program evaluations, that almost two-thirds of those 

improvements came from two major programs: One closed small 

and inefficient industrial plants. The other targeted the thousand 

largest industrial enterprises for big efficiency improvements. 

11 

What China needs for better program management, and is developing now, is the same kind of data for smaller programs and for 

local governments. 

My fourth point is that China is also moving quickly to improve 

its methods for collecting data on actual greenhouse gas emissions, 

not just energy use. In 1994, China produced its first national 

inventory of emissions with the help of the U.S. Department of Energy. Now it is working on its second inventory. And under the Copenhagen Accord China has agreed to report its emissions every 

two years. They are currently creating a system that will allow for 

much easier updates than was the case under the first national inventory. 

Finally, I would like to note that moving from preparing just national-level inventories to collecting firm-level numbers is quite recent, even in the United States and other developed nations. The 

European system is only one decade old and the Unted States required firm-level reporting only last year. In China, under the new 

40–45 percent carbon intensity target, we are likely to start seeing 

annual reporting from local and provincial governments during the 

12th five-year plan, which begins next year in 2011. 

In sum, China’s national data is already good enough for us to 

evaluate its commitments under the Copenhagen Accord. At the 

same time, China is making significant efforts to improve the quality and quantity of the data it collects on energy use and greenhouse gas emissions. 

With that, thank you very much. 

[The prepared statement of Ms. Seligsohn appears in the appendix.] 

Ms. OLDHAM-MOORE. Thank you, Deborah. 

Professor Wara, please. 

STATEMENT OF MICHAEL WARA, ASSISTANT PROFESSOR, 

STANFORD UNIVERSITY LAW SCHOOL 

Mr. WARA. Good afternoon. Thank you for inviting me to testify 

before the Commission. 

My testimony concerns the role that carbon markets, and in particular the Clean Development Mechanism [CDM], have played and 

can play in increasing transparency in energy and climate governance in China. 

The Clean Development Mechanism is a carbon offset market 

created by the Kyoto Protocol. After the EU emissions trading 

scheme, it’s the largest carbon market ever created. Approximately 

12 million tons of carbon dioxide offset credits are issued every 

month in the program, and it’s estimated roughly that around 800 

million tons of offsets will be generated prior to the expiration of 

the Kyoto Protocol at the end of 2010. 

Fifty-five percent, roughly speaking, of offset creation occurs in 

China, and that’s because rapid growth of emissions, in practice, 

creates the best opportunities for emission reduction opportunities. 

So, offsets tend to follow or to go where there is emissions growth. 

The CDM is widely considered to have increased transparency in 

energy and climate governance in China, both in terms of public 

knowledge of the detailed implementation of energy policies by the 

NRDC, and in terms of firm-level greenhouse gas emissions within 

China. 

12 

The CDM creates incentives for information disclosure. In order 

to get credits, project applicants—either energy or industrial facilities in China—need to show, need to prove within the CDM regulatory process, both an estimate of baseline emissions, i.e., the no 

carbon offset project emissions, and a measurement of actual emissions by the project. 

In practice, both estimates—one an estimate, another a measurement—are checked by third party verifiers, internationally certified 

under the Clean Development Mechanism, and are checked again 

by the CDM’s governing body, the executive board, which meets 

regularly in Bonn. 

Thus, transparency of information is necessary in order to determine both whether a project is additional—that is whether the 

credits being generated represent real change in behavior from the 

baseline case. In order to know that, one needs to know what the 

baseline case was for a particular powerplant or industrial facility, 

and transparency is necessary in order to determine the level of 

credit generation that should occur. In order to measure the difference between actual emissions and the estimate of the baseline. 

Overall, the extent to which information disclosure enhancing 

the transparency of the energy sector in China occurs is largely a 

function of the sense that project developers, carbon offset project 

developers, i.e., large electricity generators such as Huaneng Power 

have, that they must disclose this information in order to win approval of their project applications under the CDM, and subsequently to generate issuance of carbon credits once the projects 

have operated. 

Thus, the extent to which projects are transparent and/or render 

transparent aspects of the industry in which they operate is largely 

a function of how stringent the third-party verifiers—essentially 

the policemen, the enforcers—of the Clean Development Mechanism are in enforcing the rules and in checking claims made by 

project applicants. 

This process of disclosure and review by third parties, in practice, has worked modestly well. Many projects disclose information 

that would otherwise be unavailable to the public. A wonderful example of this has occurred in the renewable energy sector, in particular in the wind sector in China, where, prior to the CDM, the 

tariff rates allowed by NRDC for particular wind farms were confidential business information. That made it very difficult for new 

wind farms to understand where their negotiating position should 

be relative to NRDC and created uncertainty in the marketplace 

with respect to returns. 

Subsequent to the CDM, because all project documents are 

placed on the CDM Web site and are available globally, there is 

much greater transparency information about business prospects 

for wind within China. At the same time, a large amount of information that would be pertinent to determining baselines, to determining the business-as-usual case without carbon offsets, changing 

incentives, has not been disclosed or has been disclosed imperfectly. 

I think the best example of this would be dispatch and tariff policies for coal-fired powerplants, which really are at the base case 

generation for much of China. In part, that disclosure has not ocVerDate Mar 15 2010 10:15 Nov 23, 2010 Jkt 000000 PO 00000 Frm 00014 Fmt 6633 Sfmt 6633 U:\DOCS\56971.TXT DEIDRE
13 

curred because the third-party verifiers and the CDM executive 

board have not asked for it. 

Transparency of verification, transparency of the actual measurement of emissions from projects has been much better. In general, 

monitoring documents are available publicly on the Web, and those 

documents provide a wealth of information that would otherwise be 

unavailable with respect to the operation of individual facilities 

within China. 

The United States is not a participant in the Kyoto Protocol and 

so has limited prospects for impacting the operation of the Clean 

Development Mechanism. That being said, there are a number of 

U.S. NGOs that are increasingly participating in the process, along 

with a number of European, and to a lesser extent developing country, environmental NGOs, and attempting to serve a watchdog role, 

attempting to, by commenting on their registration of projects, increase the amount of disclosure that does occur within the CDM, 

in particular with respect to baseline issues. 

In order to increase scrutiny further, the United States is likely 

going to have to become a major participant in global carbon markets. Of course, that is a subject of substantial debate within the 

United States at this point, and of substantial uncertainty. However, were the United States to become a major participant, there 

are a number of avenues that might be pursued to increase the voluntary disclosure and transparency that has been created by carbon markets. 

Because of the need to prove a baseline case and the need to 

measure emissions relative to that baseline case, there are tremendous opportunities for increasing transparency, both for citizens living within China and for the broader international community with 

respect to both Chinese energy policies and to the actual practice 

at the facility level of both operating powerplants and measuring 

and monitoring greenhouse gas emissions. 

Thanks very much. 

Ms. OLDHAM-MOORE. Thank you, Dr. Wara. 

Now we are going to turn to the second part of the event, which 

is we’ll open to questions from the audience. First we’ll start with 

Anna Brettell, and after Anna offers a question to the panelists, 

we’ll turn to the audience. 

When you have a question, please raise your hand. Please direct 

your question to one panelist. 

So Anna, please begin. 

Ms. BRETTELL. Great. My question is probably for David and 

Barbara. I think David noted that there’s been a shift in the Chinese Government’s attitudes toward environmental protection over 

the last few years, but that to sustain the momentum toward 

reaching China’s environmental goals, more participation by environmental groups are necessary in that process. 

So I’m just curious. Besides the examples that you already mentioned in your testimony, are there other examples of groups that 

have been working in cooperation with the government to improve 

the environment and monitor polluters? Are there any stories 

where groups were able to make a difference in a policy outcome 

or where you could see that there was better enforcement and environmental quality improved? 

14 

Mr. GORDON. Thank you. Sure. Let me tell you about a couple 

of examples. One thing I think that’s important to point out, is that 

when we talk about environmental groups in China I think people 

recognize that the political space within China for civil society is 

a little bit different than perhaps here in the United States, and 

that’s important to understand and important to recognize. 

The groups that we partner with have found ways to adapt their 

approaches in a way that they can work cooperatively with Chinese 

Government officials, and especially creating those partnerships, 

creating those relationships at the regional level, the provincial 

level, the municipal level has been one element that we have seen 

as truly critical to their long-term success and their ability to create real environmental improvements. 

In terms of the examples that you’re asking for, I’ll give a couple 

of examples. One was an example in Anhui Province recently, 

where three chemical factories were shut down. These were chemical plants in what’s commonly referred to as a ‘‘cancer village’’ 

along the Hui River that had been polluting the waterway for quite 

some time, and community efforts to raise these concerns to the 

local Environmental Protection Bureau had largely gone unheeded 

for many years. 

The partner organization that we worked with in that province 

worked together with the local community members to help find 

avenues to bring it to the attention both of the regional Environmental Protection Bureau, as well as to the national Ministry of 

Environmental Protection. They also worked to get some media 

coverage of these issues. 

Taken together, that helped lead the government to a decision, 

in early 2008, to shut down those factories. There was a period of 

time given for the relocation of those factories. True to their word, 

at the end of 2008, the government did follow through on its promise, which resulted in some very significant public health benefits 

and environmental benefits to the people living in that community 

directly. 

Since that time, just to give another example from that same 

province, the partner group that we worked with discovered a polluting factory on Chao Lake, and just their work, together with the 

regional Environmental Protection Bureau and the local media, 

helped to get that factory to shut down as well because of their pollution practices. 

These were factories that were far out of compliance with laws 

and norms within China, so, in fact, the relationships that our 

partner organization developed with the government have turned 

out to be very friendly because the government was relying on our 

partners to help them carry out these objectives of dealing with 

this level of pollution. 

In one other example in Gansu Province, we have a partner organization that was attempting to use the Open Government Information laws and gain access to information. They approached the 

Environmental Protection Bureau early last year, in early 2009, at 

which point they were told that, well, with the financial crisis, now 

is a bad time to ask companies to provide more information. 

However, even though they got an initial rejection in that way— 

which I think Barbara talked about, the time it takes for various 

15 

government agencies to learn how to implement transparency laws 

appropriately—the long-term result was positive in that, as a result of that correspondence and that engagement, our partner organization developed relationships with that department, with that 

bureau that has since led to the bureau inviting our partner organizations to assist them in environmental monitoring efforts with 

regard to specific factories. 

So they’ve been invited to join in on government-sponsored monitoring efforts. They’ve tied that together with the work that I mentioned in my testimony to conduct third-party audits of factories. 

This has led to some specific improvements being made in at least 

one biochemical plant in the region, improved standards being applied there. So again, these are important examples to understand 

in terms of how local organizations can adapt some of these models 

to find ways to work effectively within the system. Thank you. 

Ms. FINAMORE. That’s a very interesting question. In addition to 

the examples that I gave in my written testimony, I’d also like to 

highlight a couple of small, but very promising developments in the 

use of the court system, both for enforcement purposes and for 

open information, in particular, development of a system—currently very tiny, but promising—for public interest lawsuits. 

Now, I’m sure many of you know that there have been many 

years of lawsuits by groups like the Center for Legal Assistance to 

Pollution Victims, including some class action suits that have yielded damages for injured members of the public, particularly farmers 

and fishermen whose livelihood has been threatened by pollution. 

But what has happened in the last year or so that’s different, is, 

number one, the development of 11 environmental courts, mostly 

focused in three provinces, and interestingly enough, located in 

places you may never have heard of or wouldn’t expect to see them. 

But these are areas where there have been severe environmental 

problems, most often water-related, and where there has been environmental unrest. This indicates very clearly the role that the government sees for environmental lawsuits as a way to help promote 

social stability, because the alternative is often social unrest. 

Even more exciting to me as an environmental lawyer, is that 

two of the cases that have been resolved in these environmental 

courts have actually been brought by an environmental NGO, not 

on behalf of members of the public, but on behalf of the public as 

a whole. This is the kind of lawsuit that NRDC pioneered in the 

United States 40 years ago and the potential, if this is continued 

and expanded, for improving enforcement and environmental information cannot be overstated. 

Now, I hasten to add that this environmental organization is 

what is often referred to as a GONGO, a government-organized 

NGO. It’s the All China Environment Federation. This is a publicly, government-approved NGO. So I think that’s part of the reason why these lawsuits were able to go forward. 

One of them resulted in a settlement of a dispute that had been 

ongoing for 15 years, so that shows the power of these lawsuits. We 

believe that they set a precedent. Even though the plaintiffs in 

these two cases were not the types of independent NGOs that 

David was talking about, we think they set a precedent that is 

16 

going to make it possible for other NGOs to bring cases in the future. 

Ms. OLDHAM-MOORE. Thank you. 

Now we’ll turn to the audience. Yes, please. Can you please 

stand? Please state your name, but project your voice. Usually we 

have microphones. Today we don’t, so we’ve got to project. 

AUDIENCE PARTICIPANT. I thank all of you for a very insightful 

set of discussions. Thank you. I’m (inaudible) with (inaudible) 

Strategies. Rather than tracking absolute emissions reduction, 

China wants to track emissions reductions through energy intensity targets. In your opinion—maybe directed to Debbie, but all of 

you could address this—will China really get where it needs to be 

in terms of absolute reductions? Are there any challenges with respect to the measurement, reporting, and verification that this presents? 

Ms. OLDHAM-MOORE. Great question. Please, Debbie. 

Ms. SELIGSOHN. Okay. So China’s moving from energy intensity 

to carbon intensity in the 12th five-year plan, so both are intensity 

per unit GDP, but what they’re measuring is going to change. It’s 

going to be energy-related carbon dioxide emissions per unit GDP. 

So I think the reason the Chinese chose to use this metric is because the other alternative that a lot of developing countries have 

chosen to use is an offset from business as usual [BAU]. That gets 

you immediately into a lengthy and complicated discussion about 

what business as usual is. 

I think Michael illustrated, in his discussion of this on the CDM 

market, that even in what is relatively simple and small-scale at 

the project level, determining what the baseline is and determining 

a BAU is very hard. So one of the tricks or advantages of using 

a carbon intensity metric is it’s straightforward, it’s CO2 per unit 

GDP, and you don’t have to worry about what the baseline is. 

It’s worth realizing, the CDM market is minuscule compared to 

China’s overall emissions, so the type of approach that he talked 

about at the project level is not conceivably scalable, even in a developed country like the United States, much less in a developing 

country with resource constraints. So you need something that’s 

fairly straightforward, and that’s why they chose to go with this 

carbon intensity approach. 

The reason you wouldn’t use an absolute emissions approach at 

this point is because China is still a developing country. Remember, their per capita GDP is about $5,000 per capita, compared to 

$45,000 in the United States. They are still in the period of rapid 

build-out of infrastructure, rapid urbanization as people choose on 

their own to move from rural areas to urban areas seeking jobs, et 

cetera. 

So I don’t think there’s any question among anyone who observes 

developing country emissions that China’s emissions are going to 

continue to grow for quite some time, and there’s no one in the climate world who thinks that it would be otherwise. So what you’re 

looking for is a way to slow the rate of that growth, and then hopefully reach a peak and then hopefully find a way to get over to the 

other side and start declining. 

So you want something that is a control on growth rather than 

seeking to decline from a baseline. That was recognized all the way 

17 

back in the U.N. Framework Convention in 1992, and it’s clearly 

recognized, first in the Bali Action Plan, and then in the Copenhagen Accord. I think everybody understands that. So that’s why 

you would choose it. 

I think the other part of your question is, is the way China is 

going about this going to be sufficient? So when we look at that 

question we’re really looking at where we’re trying to get, both by 

2020 and by 2050. The Chinese, for a lot of reasons, have said they 

have agreed to the 2-degree goal, to keep the global temperature 

within a maximum rise of 2 °C, but they mostly wanted to talk 

about actual practical measures up to 2020. I think that has a lot 

to do with being a rapidly developing country, where it’s hard to 

know what’s going to be going on beyond 10 years from now. 

If we look at the International Energy Agency’s [IEA] scenario 

for what you would need to keep the world within 450 parts-permillion carbon dioxide equivalent, which is what is hypothesized to 

be necessary to keep the world within 2 °C, China’s carbon intensity target is basically in line with what they suggest would be 

needed under the 450 scenario up to 2020. What the IEA’s scenario 

does is stabilize global emissions by 2020, and then look for significant reductions after 2020. 

Now, to stabilize by 2020, developed country emissions need to 

be going down now. Remember, in the 1992 convention, what all 

of us as developed countries agreed to was that we were going to 

start reducing our emissions right away, and that was 18 years 

ago. So the IEA’s scenario is basically all of the developed countries 

would be reducing now, and then you would have these various 

controls in developing countries trying to control the rate of increase. 

China’s carbon intensity target, as long as average economic 

growth does not go much above 8 percent over the next decade, 

would be broadly in line with that. If economic growth winds up 

being really high, I think they would need to re-look at it. If you 

still have the same carbon intensity target, you would definitely 

see much more rapid growth in emissions. 

The U.S. target of 17 percent is a little shy of the IEA 450 scenario. It’s close. For the United States, about 18 percent would fit 

the 450 scenario. I think the Chinese set that 40–45-percent goal 

with some concern that growth might actually be well less than 8 

percent, and they’re always pretty cautious in their planning and 

their predictions, assuming a somewhat lower growth rate than 

they actually wind up with. 

There has been some disagreement among economists on where 

China is going to go in the next 10 years in terms of growth, but 

I think most people don’t expect it to be much above 8 percent. 

There is a school of thought that thinks it will be less. So to some 

extent we’ll have to wait and see. They have an opportunity, in the 

middle of the period, to reexamine and adjust because they’re going 

to incorporate this target in their five-year plans, so they’ll have 

two five-year plans to work with. 

Ms. OLDHAM-MOORE. All right. Thank you. 

Yes. The gentleman with the purple collar. Please. 

Mr. Weis. Hi. Robert Weis with Global Resources Institute. My 

question is for either (inaudible). You both spoke about environVerDate Mar 15 2010 10:15 Nov 23, 2010 Jkt 000000 PO 00000 Frm 00019 Fmt 6633 Sfmt 6633 U:\DOCS\56971.TXT DEIDRE
18 

mental protection and climate change as being basically the same 

thing, or at least moving in the same direction. But recent research 

indicates that they are separate (inaudible) for example, sulfur dioxide and also CO2. Sulfur dioxide actually has a net cooling effect. In fact, our research indicates that aerosol (inaudible) sulfur dioxide and organic 

(inaudible) so there is somehow some synergies between (inaudible) 

and in some of them there is a (inaudible) we’ve seen of (inaudible) 

environmental benefits, but also considering climate considerations 

as well since (inaudible). What are some of the steps that China 

can take (inaudible)? 

Ms. FINAMORE. I would hate to think that China’s main tool for 

controlling its CO2 emissions was to increase its sulfur dioxide 

emissions. I know what you’re saying, though. Research has shown 

a cooling effect on the SO2 emissions. When I was saying they were 

going in the same direction I was basically talking about the transparency issue, not the actual levels of pollutants, whether it be carbon or SO2. So to me, in finding ways to reduce CO2 there are 

synergies, of course. If it means using less coal you’re going to reduce both and you’re going to improve the health and economy of 

China. To me, that’s the win-win situation. 

One of the ways to do that is, of course, through renewable energy. I was just in Beijing last week touring some of the very exciting developments on solar power in China, including a whole city 

called Solar City that’s designed to promote the solar hot water 

heaters that China leads the world in. But I was struck by the fact 

there and at other solar facilities, that the level of particulates in 

the air made it very difficult for the solar radiation to reach these 

facilities. 

So here’s an area where reducing coal is going to have an impact 

in several ways and it makes it more likely that solar can increasingly substitute for coal. So to me, that’s the way to go rather than 

to say let’s just focus on one pollutant and try to reduce that. In 

fact, that’s one of, I think, the areas where China can improve its 

air pollution regulation. 

In this current five-year plan it’s focused so heavily on reducing 

SO2, and it claims to have met its five-year target a year ahead of 

schedule, what we’re hearing is that that focus on SO2 reduction 

has meant less resources, less attention paid, less accountability for 

reducing a number of other air pollutants, so we’re hoping that will 

change in the coming years. 

But I think in general, my view is that a comprehensive approach is needed for all pollutants. We have promoted this four-pollutant strategy in the United States for many years. We believe it’s 

cheaper for powerplants, in particular, to regulate SO2, CO2, NOx, 

and mercury all at the same time rather than regulating them sequentially, which is going to cost more money and therefore be less 

likely to be implemented. 

I would say also that the equipment that is often used to monitor 

the SO2 in the powerplants can also be used for CO2 reduction, another reason to put that monitoring equipment in place that can be 

used to monitor more than one type of pollutant. So in general, I 

think a comprehensive approach is the way to go. 

Ms. OLDHAM-MOORE. Debbie, you wanted to say something? 

19 

Ms. SELIGSOHN. Yes. I, first of all, want to say that I absolutely 

agree with Barbara. We’re certainly not suggesting, at the World 

Resources Institute, that we would use one pollutant to counter another. In fact, a lot of our work, in working at the company at the 

local level in terms of greenhouse gas emissions accounting is specifically to help companies and localities plan their energy efficiency moves in the hope that it does yield those co-benefits on 

both local pollution as well as on energy. 

The other thing to note in addition to what you said, is that in 

fact a number of provinces have used their experience with continuous emissions monitoring of sulfur dioxide under the 11th fiveyear plan to add continuous emissions monitoring of NOx as well 

at their powerplants. There are now three or four provinces that 

have mandated this, even though it’s not nationally mandated yet. 

I think we are going to see that mandated in the next five-year 

plan. It’s with the monitoring of NOx where you actually have to 

monitor an additional gas as a diluent, that you have to choose either carbon dioxide or oxygen. And therefore most places choose 

carbon dioxide. That’s going to give you the actual continuous emissions data on CO2 from powerplants, and potentially from other big 

installations. 

So while I completely agree with you that there was this kind of 

mono-fixation on SO2 in this five-year plan, some of the learning 

process from actually focusing on one pollutant and making a big 

dent in those emissions, which I think was the Ministry of Environmental Protection’s philosophy in choosing to do this, has actually 

helped provinces start to think about other pollutants. 

Ms. OLDHAM-MOORE. Yes, please. 

AUDIENCE PARTICIPANT. Hi. My name is (inaudible). I have a 

question for Debbie (inaudible) about the majority of power use (inaudible). I wonder if any—we talked about (inaudible) energy 

sources (inaudible) of energy (inaudible) different as we see more 

development (inaudible)? 

Ms. SELIGSOHN. I mean, I don’t know that it’s going to change 

the ratio, at least in the short to medium term, because the efforts 

to develop the west have been longstanding, and the east has continued to boom. What I think we’ve seen over time, is there’s a 

learning curve on environmental issues where innovations tend to 

happen on the east coast. 

Once provinces get wealthy, the governments get more focused 

on it and they get a lot more pressure from their citizens. As these 

lessons get developed, they get picked up sometimes directly by 

other provinces, but often by the national government that then decides to make them national policy. So while there has been this 

tendency globally for each country to have to go through its own 

mistakes and then learn from them, that seems unfortunate. It 

would be better if we could all learn from each other’s mistakes. 

Within China, there does seem to be sort of a learning curve 

from one place to the other, so that hopefully the lessons learned 

on the east coast can be transmitted to the west. But I think in 

each province, there’s going to be sort of a period where there has 

to be some effort and some pressure from the center and from others to improve data, et cetera. But as what western provinces do 

20 

becomes more a part of the national economy, that data gets picked 

up better by national recordkeeping mechanisms. 

AUDIENCE PARTICIPANT. Do you have any examples of (inaudible) 

that are (inaudible)? 

Ms. OLDHAM-MOORE. Examples of western cities that are leapfrogging—— 

AUDIENCE PARTICIPANT. Or any examples of (inaudible) and implementing (inaudible). 

Ms. OLDHAM-MOORE. Western cities that are making greater 

progress than anticipated, learning from eastern cities. 

Ms. SELIGSOHN. I have to admit that most of the cities that I 

know of that are working are in the east or in the center. There 

are some in the center that are really focusing on it, like Baoding, 

which is not a wealthy city but has decided it wants to be like a 

low-carbon leader. But I don’t actually know of any sort of far-west 

cities. I don’t know if Barbara’s survey has some. 

Ms. FINAMORE. Well, in answer to your first question, two trends 

that I see of interest are, one, China’s very heavy investment in 

what they call a strong, smart grid. A lot of that investment is emphasis on the strong. It’s building the transmission lines that are 

going to help connect the renewable energy resources in the west 

to the sources of demand in the east. But the lessons to be learned 

from within China are how to connect the renewable resources to 

the grid. That’s been a real problem, not just in China, but also in 

the United States. This is another area where I think there’s tremendous interest and potential for collaboration. 

The other area I note is that China’s target for non-fossil energy 

of 15 percent by 2020 relies heavily on large hydro, a lot of which 

is planned or being constructed in the west and other parts of 

China. But what we’re seeing and hearing is a lot of increasing 

concern within China based on all the droughts that are going on 

right now, and concern that even with the dams that they are planning to build, if they build them, there’s not going to be the water 

in there to be able to generate the electricity at the high rates that 

are being planned. So these are two things to watch. 

Ms. OLDHAM-MOORE. Yes, sir. Please. In the back. 

AUDIENCE PARTICIPANT. I have a question for Barbara and Deborah. So what lessons has the United States learned from China in 

terms of data collection and data reporting process for energy (inaudible)? And a second question. What can you tell us about the 

progress in China in the second national communication in terms 

of factory inventory? 

Ms. OLDHAM-MOORE. In terms of the inventory? Okay. Great. Of 

greenhouse gases. Thank you. 

Ms. FINAMORE. Well, maybe I’ll address the first question and 

Deborah can address the second. 

I don’t necessarily think this is an area where the United States 

can learn from China; I don’t think it would work in our system. 

But I think it’s important for people to realize that a new approach 

that China is taking to improve accountability, and therefore transparency and enforcement, is the job performance rating system of 

provincial governors and the heads of the large enterprises. Just 

for an example, the SO2 target in the current five-year plan. There 

was a similar target, actually much larger, a 20-percent reduction 

21 

target, in the 10th five-year plan that was just not even close to 

being reached. Rather than going down 20 percent, SO2 emissions 

went up about 27 percent in the period 2000 to 2005. What 

changed between the 10th five-year plan and the current one to enable China to meet that SO2 reduction target? I think one of the 

main factors was the adoption of this new job performance rating 

system in which provincial governors and other leaders are rated 

not just by how well they grow their GDP, but by how well they 

meet the SO2, the COD, and the energy intensity targets. 

There’s actually a very complex system, a scorecard that the government at the central level has put in place and that applies to 

every province and local government that rates these officials and 

determines what their career path is going to be, whether they’ll 

get a bonus, whether they’ll be transferred to Beijing for a higher 

level position, or perhaps even lose their job. This is almost unheard of; if you think of President Obama telling state governors 

that they’re going to be rated on how well they meet certain of his 

environmental targets. 

But China has a different political system and they are finding 

that this is a way of really motivating the local governments in a 

way that’s never been seen before. So we hear that the carbon intensity targets will probably be added to that job performance rating system in the next five-year plan, and also several other air 

and water pollutants. Again, I’m not going to say this is something 

we should adopt in the United States, but people need to realize 

the power of this important new tool. 

Ms. OLDHAM-MOORE. Thank you. 

Anybody else? Debbie? 

Ms. SELIGSOHN. Actually, I think there may well be some lessons, whether they’re going to be for the United States or whether 

they’re useful for other developing countries, because in certain 

areas China is innovating lower-cost ways to do things that we’re 

doing. For example, the continuous emissions monitoring equipment that they’re using, they’ve installed it in a way that’s much 

less expensive than in the United States, and U.S. EPA is working 

with them on it. So if it turns out that it gets you as good data, 

or close enough to as good data, it would mean it would become 

much more useful not only in China, but elsewhere in the developing world. 

The Chinese have already shown that they can produce scrubbers for powerplants that are slightly less effective than those that 

are used in the United States and Europe for radically less cost, 

and that may be an excellent trade-off for developing countries, or 

certainly in the short- to medium-term. So there are a lot of innovations there where I think there’s a lot of cost-saving lessons that 

people are going to be able to take away. 

On the inventories, we know they’re actively developing them. 

They launched this project more than two years ago now. They 

have that new memorandum of cooperation with the U.S. EPA that 

they signed during President Obama’s visit last October. It is specifically working on developing these systems so that the inventory 

is not a one-off exercise, but actually becomes something that can 

be updated every two years. 

22 

Because the big issue—and this was in all developing countries— 

was the way the first set of inventories were done in the 1990s, the 

first set of national communications, is that countries got some 

project financing and they did it once, and then they had no system 

for regular updating. So only one developing country has submitted 

a third national communication and less than a dozen have submitted two, so this is sort of a global issue. Again, hopefully some 

of the lessons that the Chinese and EPA, together, learn on how 

to get these systems set up for regular updating will be useful to 

other developing countries as well. 

Ms. OLDHAM-MOORE. Thank you. 

Will? Please. 

Mr. CHESTER. Will Chester—Commission. My question is for Mr. 

Wara and Mr. Gordon. I think in the past, China has taken a few 

different approaches to a lot of environmental issues and pollution 

controls. There’s the 2006 Green GDP (inaudible) sensitive (inaudible), and then recently in February, the Pollution Census was 

released. My question is, the Pollution Census, which was a large 

undertaking, that took two years, reported much higher rates of 

pollution than official numbers had shown currently. 

My question is why there was such a discrepancy in the first 

place, if these figures are going to be reconciled going forward, and 

is there any acknowledgement by the government that there might 

be some discrepancies as to the current system? 

Ms. OLDHAM-MOORE. Great. Thank you. Great question. Mr. 

Wara? 

Mr. WARA. Well, my understanding of the cause of the discrepancies—and I will confess to not knowing all of the detail on this 

issue, is that the more recent estimates included agricultural inputs to water, like non-point source biological oxygen demand, 

whereas the earlier estimates did not. 

In a context where the price of fertilizer is heavily subsidized, 

and it’s a known issue that there’s substantial over-fertilization, 

over-use of fertilizer in agricultural settings, it’s not surprising that 

the numbers that include that input would be much higher. That 

may not be the whole story, but that’s a piece of the story that I 

have heard. 

Ms. OLDHAM-MOORE. Great. I’m sorry. Will, did you direct your 

question to somebody else? 

Mr. CHESTER. To Mr. Gordon. 

Ms. OLDHAM-MOORE. Oh. Excuse me. 

Mr. GORDON. I would just add that I think the point I take from 

this is that it’s an iterative process. I do expect there to be further 

versions of this, whether it be a new version of the Pollution Census or some further approach that is taken. Again, this is very 

similar to the kinds of processes we’ve seen work here in the 

United States, that not all the information is going to be accurate 

the first time around and it’s impossible to expect that. 

However, the more you have multiple systems of reporting the 

more you’re able to verify, you’re able to check between them. If 

those multiple systems are transparent, then you have plenty of 

options for raising some of the questions like you’re raising now to 

try to refine those systems over time. I believe there’s a very strong 

23 

commitment coming from government levels, especially the central 

government within China, to do that. 

Ms. SELIGSOHN. May I? 

Ms. OLDHAM-MOORE. Yes. Absolutely. 

Ms. SELIGSOHN. The extraordinary thing about the Pollution 

Census was getting the active cooperation of the Ministry of Agriculture and getting the Ministry of Agriculture actually at that 

table announcing those results. I think that was a deliberate effort 

by the State Council, China’s highest governing body, to get that 

part of the pollution picture that they’ve very much known is a big 

part of the picture, but getting different ministries working together and making it happen is always a difficult political process. 

I think the census was actually a major step forward and I think 

we’ll start to see more collaborative action on agricultural pollutants, which of course are a major issue in the United States and 

every other agricultural country as well. 

Ms. OLDHAM-MOORE. Great. Yes, sir? 

AUDIENCE PARTICIPANT. I’m (inaudible) and I am a student at 

the University of Maryland School of Law (inaudible). My question 

relates to what you mentioned earlier that two of these cases have 

been brought by citizen environmental groups. Did the local rules 

that were passed extend to environmental groups based in the 

United States? 

My question is two-part. First, is this the kind of (inaudible) you 

talked about earlier in terms of further (inaudible)? And second, is 

this kind of (inaudible) problem for the cooperation (inaudible) in 

terms of (inaudible)? 

Ms. OLDHAM-MOORE. That’s a fascinating question. 

Ms. FINAMORE. Guiyang is one of the sites of the environmental 

courts. We’ve been working closely with them on these regulations. 

I did not mean to suggest that the window would open for NGOs 

based outside of China to bring lawsuits, I meant NGOs within 

China. NRDC, for example, has no plans or interest in bringing 

that kind of litigation within China, but we do think there is certainly a role for the many NGOs, especially in the local areas, that 

are concerned about their local sources of pollution, to take action 

on behalf of the community as a whole. 

One problem I would mention that means this whole process is 

going to move slowly is that, even though these courts have been 

set up under some basic laws in China that allow local courts to 

be established, there is still no specific regulations or judicial interpretations in China that allow for the types of regulations that 

you’re talking about. So we’re now working with the higher level 

courts to try and get them to put these court experiments, such as 

they are, on a more legal footing. I think that has to be the next 

step. 

Ms. OLDHAM-MOORE. Great. Thank you. 

Anybody else? Oh, I’m sorry. David, are you going to respond? 

Oh, great. Terrific. 

Mr. GORDON. Since some of the question was, I guess, addressed 

toward how will this affect our local partners, first of all, I very 

much agree with what Barbara said. Just to be on the record, Pacific Environment also would have no plans to start any lawsuits 

in China. It’s not our role. 

24 

Now, it is a standard practice for legal systems, including the 

U.S. legal system, to have standards whereby a foreign NGO could, 

under appropriate circumstances, bring a lawsuit here in the 

United States. In fact, there are some efforts under way where 

that’s being tried. 

I would just comment that really the development of these public 

interest lawsuits and litigation practices in China are very important and they’re part of the solution for local capacity and building 

local solutions to these problems. 

The key point here is helping people within China to have standing, to have access to the courts, to have access to all of the legal 

ways to resolve any conflicts or differences so that the rule of law 

becomes the mechanisms that they use to resolve key pollution 

issues. 

Ms. OLDHAM-MOORE. One final question and then we’ll close. 

Please, sir. Actually, we have two questions. How about both of you 

ask a question, but just very quickly, please. 

Mr. LITTLE. Maybe someone on the panel can respond to this, 

and that would be great. My name is Mark Little, House Regulatory Affairs. (inaudible) natural resources (inaudible) outside of 

China, so I was wondering, is there any interest by the Chinese 

Government to buy loans, maybe by Chinese banks, to get (inaudible) in Southeast Asia and in Africa on board with some of these 

kinds of—— 

Ms. OLDHAM-MOORE. That’s a great question. External migration 

of good practices. Is that happening? 

Ms. SELIGSOHN. Actually, the Export-Import Bank of China came 

out with its first set of principles on that about two years ago. It’s 

an area where I think there’s a lot more work that everybody 

wants to see done. It’s an area where even some of the Chinese 

local NGOs have been talking to various ministries, including the 

Ministry of Commerce, about how to set up good practices for companies moving outside of China. The Ministry of Commerce has set 

some up on forestry, actually. It is an area that we are working on 

in terms of working with the IFIs [international financial institutions] and with other Export-Import Banks to try to work globally 

on this question, so I think it is a developing area. 

I don’t think it’s going to be an easy one, necessarily, for China, 

as it has not been easy for other countries. I think people often 

overestimate how much knowledge the Chinese Government has of 

what its companies are doing when they go abroad, and there’s an 

awful lot that is going on that involves small, private Chinese investors that the government may have no knowledge of. So it’s definitely a work in progress, but it’s something that is increasingly on 

their radar screen. 

Ms. OLDHAM-MOORE. Thank you. 

And sir—oh, excuse me. Did you want to say something? 

Mr. GORDON. Just quickly, to add to that, that’s all very much 

a work in progress and it’s very good that the Export-Import Bank 

of China regulations were mentioned. It’s an area that is getting 

a lot of attention right now. One important area worth mentioning 

is the Chinese Government has adopted rules to try to prevent financing of egregious polluters within China, and that’s been an effective tool used to try to control pollution domestically. Many of 

25 

the NGOs see an opportunity to take that over into the international arena and educate the Export-Import Bank of China, and 

others, about that. It is going to be a long process but I think it’s 

a very worthwhile one. 

Ms. OLDHAM-MOORE. I cut you off. Please, young man. Thank 

you. 

Mr. COATES. My name is David Coates. I’m with the Natural Resources Defense Council. This is a question for Michael Wara. 

Dr. Wara, I was wondering whether you could share with us 

some lessons from (inaudible) regarding the concept of business as 

usual, or a baseline. This is something that’s much more a mainstream question following China’s announcement of its decision to 

reduce carbon intensity in the lead-up to the December Copenhagen Conference. What’s tricky is kind of the lack of standard 

methodologies or accepted principles (inaudible). I was wondering 

whether the (inaudible) experience might (inaudible). 

Ms. OLDHAM-MOORE. You have the last word. 

Mr. WARA. I would tend to agree with what Debbie said earlier. 

To the extent that it’s possible, baseline setting is an approach 

where we try to project far into the future some business-as-usual 

baseline. It’s one that we should be very cautious about. 

The CDM to this day struggles with this issue and it leads to 

some of the most difficult and controversial decisions that the executive board has to make. There are no signs that that problem is 

going away, is going to get any easier anytime soon. The same 

problem is likely to bedevil red programs, if and when they are implemented at scale. I think we saw some of the same issues coming 

up in Copenhagen with respect to base years from which to judge 

emissions reductions. 

So it’s a problematic concept because we do not know the future 

terribly well, especially projecting out 10 to 20 years. So I would 

just say that if there’s one lesson the CDM teaches with respect to 

baselines, it’s be careful, be cautious, and recognize the uncertainty 

that’s inherent in an unobservable. 

Ms. OLDHAM-MOORE. I want to thank the panelists for an absolutely fascinating discussion today. Thank you for traveling and 

being with us today. 

Thank you to Anna Brettell for pulling this event together. You 

did a terrific job. 

Have a great afternoon. Thanks. 

[Whereupon, at 3:34 p.m., the roundtable was adjourned.] 

(27) 

A P P E N D I X 

28 

PREPARED STATEMENTS


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PREPARED STATEMENT OF DAVID GORDON

APRIL 1, 2010

Thank you for the opportunity to provide testimony to you today on the subject 

of transparency in environmental protection and climate change in China. 

Pacific Environment is a U.S.-based NGO that protects the living environment of 

the Pacific Rim by promoting grassroots activism, strengthening communities, and 

reforming international policies. Our successes over the past 20-plus years stem 

from a deep and abiding trust that local people, armed with the right tools and solid 

support, are the best hope for protecting the world’s environment. As such, we support the development of grassroots organizations, prioritize community-based advocacy, and leverage international resources in service of our local partners. Together 

with these grassroots advocates, we have protected tens of millions of acres of wilderness, spearheaded campaigns to protect endangered species, launched efforts to 

fight water pollution, reformed environmental and social standards for export credit 

agencies, and publicized critical environmental issues around the Pacific Rim. We 

support communities in China, Russia, Alaska and California to have a larger voice 

on the critical environmental issues that affect them, including climate change 

which increasingly impacts their livelihoods. 

Pacific Environment has worked in China for over 15 years, assisting local environmental organizations to grow a mature environmental movement that is effective 

at working together with the Chinese government to address the most pressing environmental issues affecting China’s development path. 

The majority of our work in China focuses on strengthening Chinese non-governmental organizations to address water pollution issues. The lessons we learned 

through these efforts have relevance to questions of transparency in environmental 

protection, and can also help us understand how to promote transparency in dealing 

with climate change issues in China. 

One of China’s most critical environmental problems is water pollution; In 2005, 

top Chinese governmental officials indicated that over 360 million rural Chinese 

lack access to clean drinking water; over 70 percent of lakes and rivers are polluted; 

and major pollution incidents happen on a near daily basis. 

Water pollution not only strains the environment, but also severely impacts public 

health. Today, China has an alarmingly growing cancer rate, with hundreds of ‘‘cancer 

villages’’ sprouting up near polluted water sources. The World Health Organization 

recently estimated that nearly 100,000 people die annually from water pollution-related illnesses in China, and 75 percent of disease comes from water quality issues. 


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China’s water pollution crisis made international headlines following a 2005 

petro-chemical plant explosion which released 100 tons of benzene into the Songhua 

River, a major waterway in Heilongjiang Province and a water source for millions 

of people. Such spills are not rare in China, yet the accident and ensuing cover-up 

opened a new space for encouraging the Chinese government to change its approach 

to water pollution, specifically as it relates to public access to information, enforcement of pollution laws and accountability, and international information-sharing 

and cooperation. 

Over the past several years, there has been a noticeable shift in behavior by the 

Chinese government as it pertains to environmental issues, particularly water pollution. Pan Yue, a Vice Minister of China’s Ministry of Environmental Protection 

(MEP), openly acknowledged that ‘‘the environmental crisis, particularly for water, 

is coming to China earlier than expected.’’ 

Pacific Environment believes that improvements will only be successful and sustainable if local, regional and national environmental groups are able to establish 

themselves as stronger watchdogs of, and advocates to, the government and private 

industries. 

Working with many partner environmental groups across China, Pacific Environment is reaching out to local communities concerned about water pollution and helping them to conduct legal, public relations, and advocacy campaigns to reduce the 

impacts of water pollution on public health and the local environment. Through 

these actions, our partners are playing a pivotal role to ensure clean water for China’s future. 

Just as in the United States, China’s decades of economic and industrial growth 

have brought major environmental challenges, including pollution, deforestation, 

biodiversity loss, and desertification. In response to these ecological challenges, a 

public environmental movement has emerged and grown. 

China’s water crisis includes overall ecosystem degeneration and a lack of public 

access to clean drinking water. Despite strong national policies to address water pollution, lax implementation of these laws inhibits local progress. These policies can 

become successful and sustainable, however, especially if NGOs can establish themselves as resources and experts that assist regional environmental protection bureaus to monitor and report on water pollution. The time is especially ripe for this 

type of public involvement in the wake of the implementation of China’s environmental information disclosure law—a powerful tool for environmental groups to 

assist their communities in accessing information on polluting enterprises and to ensure public participation in environmental decision making. 

Using China’s new Public Disclosure of Environmental Information law, groups 

can request pollution information from local enterprises and governments and 

achieve water quality improvements at the local level by using this information to 

ensure that polluters are accountable to the law and to local communities. This 

strategy helps communities to understand issues related to water pollution and engages them in local environmental issues. It also ensures that those working for 

pollution reductions are involved directly in local ecological and public health 

improvements and that they are accountable to local communities. Over time, increased public participation in pollution monitoring will result in governmental action to enforce pollution control and improve water quality. 

The Public Disclosure of Environmental Information Law is, in many ways, similar to the U.S. Freedom of Information Act. Just like the Freedom of Information 

Act, it will take time for Chinese government agencies to learn how to fully implement the law. Last year, when a partner organization in China requested information from a local environmental protection bureau, they were told that the time was 

not right to provide information due to the economic crisis. However our partner 

used the opportunity to build closer relations with the local government agency and 

since has been invited by local government officials to participate in pollution monitoring. 

In the United States, years of precedent-setting litigation was required to ensure 

quality implementation of the Freedom of Information Act. While our partners hope 

that litigation is not required within China, they recognize that it will take time 

and patience to encourage the release of environmentally relevant information to 

the public. We are already seeing progress. Public transparency of environmental 

information within China is a critical step toward ensuring public trust in government information. 

In one important model, the Institute of Public and Environmental Affairs (IPE) 

in China has made great progress using open government data to publicize pollution 

sources through a National Water Pollution Map. IPE then works collaboratively 

with business, government, and local NGO representatives to encourage third-party 

audits of polluting factories that can make recommendations for pollution reduction. 

38 

This model demonstrates how Chinese civil society can use publicly available information produced by the government to achieve environmental progress. IPE has 

now expanded its model to tackle air pollution, with evident applications within a 

climate change context. 

How can the lessons learned from civil society’s efforts against water pollution in 

China be applied to climate change issues? We believe that public transparency of 

environmental information is a critical underlying component to appropriate and effective measurement, reporting, and verification of climate change mitigation efforts. 

Just like the United States, China has the potential to either make the climate 

crisis more severe, or lead the world in finding solutions. As in the United States, 

climate change is impacting the people of China with increasingly erratic and severe 

weather patterns that create environmental and economic damage and reduce the 

amount of arable land. A significant portion of China’s greenhouse gas emissions 

comes from major industrial development, which in turn pollutes waterways, dirties 

the air, and ruins ecosystems; these externalities are ultimately being paid by Chinese citizens. 

China’s central government has made encouraging statements about reducing 

greenhouse gas emissions. The National Development and Reform Commission stated that China aims to ‘‘integrate energy conservation, environmental protection, and 

control of greenhouse gas emissions into regional economic development.’’ Despite 

such central government commitments, valid concerns remain about what actions 

are being taken at the local level to address climate change. To be effective, measures to reduce greenhouse gas emissions must be implemented both centrally and 

provincially. 

Pacific Environment believes that a critical part of working with China on climate 

change issues is empowering China’s civil society and environmental organizations. 

With the right information and tools, communities throughout China can advocate 

for better energy choices. Civil society organizations can encourage provincial and 

industrial leaders to reduce greenhouse gas and other pollutant emissions. 

In the United States, actions at the local and state levels have been remarkably 

successful in developing greenhouse gas emissions reduction strategies. Indeed, the 

shift toward local and state-level strategies represented an enormous break-through 

in the United States from shifting awareness to action on climate change issues. In 

China, provincial-level strategies also have the potential to build local action around 

as-yet unimplemented central government policies. 

During the Copenhagen negotiations in December 2009, concerns were raised 

about China’s willingness to accept measurement, reporting, and verification (MRV) 

requirements suggested by developed countries, including the United States. These 

concerns were raised out of a fundamental lack of trust in official government statistics and action in China. These concerns are real and must be addressed. However, 

China also raised valid concerns about how international MRV requirements can become an intrusion on its own sovereign rights. 

A different approach to MRV is to strengthen multiple systems within China that 

will verify data and information. A critical component to a healthy MRV system 

anywhere in the world is a healthy and independent civil society sector. A healthy 

and independent civil society sector can help ensure that the government provides 

and acts upon accurate information. A healthy and independent civil society sector 

within China is compatible with China’s sovereign interests; indeed, the organizations with which we partner are very interested in collaborating with all levels of 

government to find environmental solutions. 

Historically, both the United States and China have lacked credibility in international climate change negotiations. However, it is clear that we can make the 

most progress in mitigating climate change if both the United States and China lead 

by example within their own countries to set a high standard that other countries 

can meet. This can help build each country’s international credibility and together 

we can work to save our planet from the climate crisis. 

As we have heard today, China is emerging as a leader in clean energy production. China also needs to voluntarily ramp up its coal reduction measures and 

address short-lived climate forcers, if it is to both provide significant health and economic benefits to its population and combat climate change. 

The key to mitigating the threat of climate change in China and around the world 

is to help China develop an independent civil society that will support the government in MRV, ensure that national environmental regulations are implemented locally, and improve the availability, credibility, and transparency of environmental 

information overall. 

Thank you for the opportunity to address you on the important subject of transparency in environmental protection and climate change in China. 

39 

PREPARED STATEMENT OF DEBORAH SELIGSOHN

APRIL 1, 2010

Thank you for the opportunity to contribute to the deliberations of this Commission. My name is Deborah Seligsohn, and I am Senior Advisor to the China Climate 

and Energy Program at the World Resources Institute. The World Resources Institute is a non-profit, non-partisan environmental think tank that goes beyond research to provide practical solutions to the world’s most urgent environment and 

development challenges. We work in partnership with scientists, businesses, governments, and non-governmental organizations in more than 70 countries to provide 

information, tools and analysis to address problems like climate change, the degradation of ecosystems and their capacity to provide for human well-being. 

I am delighted to speak with you today about China’s systems for measuring, 

monitoring, and reporting energy and climate data, how these systems have been 

implemented and the opportunities for continuing to build capacity and improve 

these systems. 

Measurement and reporting systems provide information for a number of different 

purposes. It is important to distinguish the functions we expect the system to provide—both in the development of the system itself, and in the evaluation of the 

system’s effectiveness and utility. Energy and climate data can be collected or disseminated for three purposes: 

1. Measuring overall progress through national-level data. This is the essential level for evaluating any country’s commitments to any international climate 

regime. It is the level at which we compare country commitments. It is also essential for the country’s own purposes in considering energy and climate policy 

in the context ofoverall macro-economic policy. 

2. Measuring the impact of specific programs or players—in other words the 

data needed for energy and climate policymakers to track progress toward specific policy goals. This includes measuring at the sub-national level since China 

allocates provincial and local quotas. It would include sectoral or company-level 

reporting to enforcement bodies (to the extent that enforcement is at those levels). Finally, it includes programmatic data—metrics collected to assess the 

progress of specific energy or climate programs. 

3. Providing data that civil society can access (public transparency). The 

transparency function can occur at all levels from national to the local. 

It is important to distinguish these three functions and the types of data needed 

to meet each goal, as well as the separate history of each type of data collection and 

dissemination in the international sphere. 

1. NATIONAL LEVEL DATA

In contrast to traditional environmental pollutants, where in the developed world 

there is now a 40-year history of collection and dissemination of all three types of 

data listed above, in the energy area until very recently data collection has focused 

mainly on the first area—the development of national-level, aggregated data sets. 

China’s history with collecting and producing energy data for an international as 

well as domestic audience is much lengthier than its focus on environmental issues. 

If one goes to the website of the National Bureau of Statistics (NBS) of China, one 

can find production data from 1952 and consumption data, starting in 1957. Over 

the years this data becomes substantially more sophisticated. Energy data in this 

regard is collected as part of overall national accounts data collection, an area that 

China has focused on during the past 30 years. 

National-level energy data is relatively easy to collect—there are relatively few 

major suppliers and some very large demand centers—and production (from the 

major energy suppliers, coal and oil companies) and consumption data (power 

plants, major industry, transportation information) can be cross-checked. The consensus of scholars we have interviewed as part of our ChinaFAQs program both in 

the United States and China is that (1) it is unlikely that energy data will depart 

from reality for long before the gap between supply and demand numbers, which 

are collected through separate networks, becomes very clear and requires a correction, and (2) the best way to track Chinese data is to observe the trend rather than 

focus on an specific short-term result. The most recent data may well need to be 

corrected in the normal cycle (as is true in other countries, as well), and especially 

in China there are some rapid fluctuations (such as the precipitous rate at which 

electricity demand dropped immediately after the 2007 Financial Crisis) that really 

need more time and context to analyze. 

Both of these points are illustrated in the most commonly raised concern about 

the quality of China’s national energy data, a period between 1998 and 2001, where 

40 

the Chinese National Bureau of Statistics (NBS) substantially underreported Chinese energy data, primarily because of an underreporting of coal production and 

use. By 2002 data collection had improved sufficiently so that what had previously 

looked like a trend toward rapidly improving energy intensity instead looked like 

a peculiar dip followed by a rapid rise in consumption. NBS recognized the aberration, and published a correction, along with a revision to national accounts data in 

2005. This incident shows the need to look at long-term trends and not rely on single year data, to recognize the ability of the Chinese system to self-correct, and the 

formal systems enabling such self-corrections to occur predictably. In 2005, NBS initiated a new program of 5-year economic censuses, specifically to assess and revise 

economic data. 

It is worth noting that since the early 2000s there has not been a similar period 

of apparent drift in Chinese energy statistics and the variability in energy intensity 

improvements have been much more easily explained in terms of current policy or 

global economic conditions than was the case in the late 1990s. Moreover, the last 

period when Chinese energy and indeed GDP statistics were questioned by international analysts—directly after the global financial crisis in 2007—it turned out 

that China’s statistics reflected the unusual way the crisis played out in China, with 

a rapid drop in heavy industrial demand that led to a short-term and dramatic drop 

in electricity generation, followed by a much more rapid and robust overall GDP rebound than in any other country. 

These statistics can thus act as a reasonably reliable guide to national energy accounts and conditions, ones that can be used both by the Chinese national government in making policy decisions and by other countries looking to see how China 

is implementing its energy efficiency and renewable energy programs. 

There is no doubt data could be improved. While NBS has become much more 

willing to revise its data sets—a practice standard in other countries, as well, (for 

example, US GDP figures have a cycle with three revisions)—Chinese revisions of 

recent-year data do not always include revisions of prior-year data, making time series analysis difficult. 

In contrast to energy data, China has substantially less experience collecting and 

reporting greenhouse gas emissions data. China produced one Greenhouse Gas Inventory of its 1994 emissions, which it submitted in its First National Communication to the United Nations Framework Convention on Climate Change (UNFCCC) 

Secretariat in 2004. This work was done with assistance from the U.S. government 

during the 1990s. China is currently in the process of preparing its Second National 

Communication, including a new inventory. During President Obama’s visit to Beijing in October 2009, the United States Environmental Protection Agency (EPA) 

signed a Memorandum of Cooperation (MOC) with the Chinese National Development and Reform Commission (NDRC) for capacity building in preparing this inventory. Our understanding of the capacity building needs as perceived by both sides 

is that it is not in the area of data collection per se, but rather in data analysis, 

and in creating a replicable and updatable system, so that China can update and 

submit an inventory every two years as provided by the Copenhagen Accord. 

One of the issues with national inventories not just in China, but in most developing countries, is that the first versions, conducted with project support from organizations like the Global Environmental Facility (GEF), were conducted as one-off 

exercises, rather than conducted with systems creation in mind.1 As a result few 

developing countries that conducted these first inventories in the 1990s found them 

easy to repeat. Needless to say, there are other issues involved, including negotiating issues about who pays for inventories, but as a practical matter the first inventory exercises did not leave in place easily replicable systems. 

Since China has not conducted regular inventories since 1994, its own GHG emissions figures that it uses for internal policy purposes are based on estimates. Since 

China’s current national policy as reported to the Copenhagen Accord relates only 

to energ-yrelated CO2 emissions, it can make reasonably good estimates based on 

its energy data. From interviews with Chinese energy researchers, we understand 

that the Chinese government has a complete set of local emissions factors (the 

amount of CO2 emitted per unit energy, differentiated by type of energy and type 

of technology used to consume it) with which they use internally to make these estimates.2 Its next inventory, currently underway, should enable it to assess the accuracy of overall GHG emissions estimates. It is not clear whether China will be 

publishing a new inventory in 2010 or 2011, but in the Copenhagen Accord it agreed 

to every two years. 

41 

2. TRACKING SUB-NATIONAL GOVERNMENTS, COMPANIES AND PROGRAMS

China can assess overall progress toward meeting its energy intensity, renewable 

energy and carbon intensity goals by looking at national-level data; however, to 

manage targets and influence the behavior of sub-national governments and firms, 

the Chinese government requires more detailed data. Over the last several years, 

the Chinese government has developed its energy information systems to track this 

data in a more detailed manner than was previously the case. Changes include more 

frequent reporting—up to twice a year for China’s largest companies—as well as detailed auditing procedures. 

China’s programs for promoting energy intensity and the greater use of renewable 

energy are complex and to some extent overlap. For example, a program to improve 

industrial boiler efficiency will assist some companies in the 1000 Enterprise Program, but might also assist smaller companies outside the scope of that program, 

and both programs serve the overall energy intensity goal. At the level of the national targets these do not cause double-counting, but tracking individual programs 

is more complex. Table 1 below details some of the major programs that contribute 

to controlling carbon dioxide emissions. There are dozens of other programs. Some 

of the successful national programs have been replicated at the provincial level, and 

there are also separate provincially-initiated programs, making a comprehensive list 

almost impossible to compile.3

TABLE 1: MAJOR CLIMATE-RELATED PROGRAMS AND ASSESSMENT

MECHANISMS

NAMA Scope Metric Reporting 

Mechanism 

Assessment 

Mechanism Time Frame 

Five-Year 

Plan 

National 

comprehensive planning document 

Qualitative 

evaluation 

of policy 

implementation 

Annual work 

report by 

Premier 

and by 

each Ministry 

Monitored 

and assessed by 

standing 

committee 

of National 

People’s 

Congress 

New targets 

set every 

five years 

Energy 

Intensity 

National, 

with targets given 

to each 

province, 

locality 

and 

stateowned 

enterprise 

Energy used 

(MTCE/ 

Unit GDP) 

Calculated by 

NBS and 

published 

in a semiannual statistics bulletin 

Collected 

from multiple 

sources to 

ensure 

crosschecking 

Five year 

goal. Many 

data are 

tabulated 

monthly. 

Provinces 

are required to 

report 

semi-annually 

Renewable 

Energy 

National, 

with targets given 

to provinces and 

power generation 

companies 

Renewable 

energy 

portfolio 

standard 

(specified 

percentage 

of renewable in 

total output) 

Energy Bureau aggregates data 

from NBS, 

various 

Ministries 

and industrial associations 

Internal data 

quality assurance 

system 

within various Ministries and 

crosschecking 

Goals to year 

2010 and 

2020, calculated annually 

42 

TABLE 1: MAJOR CLIMATE-RELATED PROGRAMS AND ASSESSMENT

MECHANISMS—CONTINUED

NAMA Scope Metric Reporting 

Mechanism 

Assessment 

Mechanism Time Frame 

The Thousand 

Enterprise 

Program 

National, targeted at 

1,000 largest enterprises 

Energy Intensity per 

unit output 

Enterprise to 

local DRC 

to NDRC 

NDRC inspection 

teams 

5-year program with 

annual targets; 

progress 

reports 

twice a 

year 

Individual 

Industrial 

Sector Targets 

Set by Sector 

Energy 

Intensity per 

unit physical output 

Industrial association to 

NBS/ 

NDRC 

Aggregated 

data from 

individual 

companies 

Annual and 

5-year reporting 

Program to 

Close Small 

Enterprises 

National, 

specified 

closures in 

electricity 

and other 

sectors 

GW capacity 

for power, 

tons of production capacity in 

industry 

Provincial 

government and 

related enterprises 

reporting 

to national 

NDRC 

NDRC conducts onsite 

verification 

5-year 

targets, annual 

progress 

reports 

Much of the effort in the 11th Five Year Plan (2006-2010) was focused on the 

large programs that would yield the energy intensity improvements needed to meet 

the national targets, in particular the 1000 Enterprise Program, whose enterprises 

use one-third of China’s primary energy, and the closure of small and inefficient enterprises. From our own work with local researchers and an upcoming assessment 

of the 11th Five Year Plan by the China Energy Group at Lawrence Berkeley National Laboratory, it is clear that the data from these programs is significantly better than that related to other programs. For these programs not only can specific 

program-related targets, such as setting up energy plans, or closing specific units 

be tracked, but they can also be related to a specific amount of energy savings. 

While for other programs, the specific program elements might be tracked (for example, number of compact fluorescent light bulbs distributed), they might not be 

linked back to the actual amount of energy saved. The challenge is that programs 

were established without necessarily being linked to the metrics collection needed 

to assess program outcomes in terms of energy use. The programs that have the 

best metrics used fairly labor-intensive evaluation techniques, in particular regular 

inspections. Table 2 below provides the evaluation metric used by inspectors to 

firms in the 1000 Enterprise Program and shows the level of detail national officials 

could focus on for such large energy users. The State Statistical Bureau is focused 

on improving statistical approaches, which would be beneficial. 

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TABLE 2: EVALUATION SCORE SHEET FOR 1000 ENTERPRISE PROGRAM

Energy conservation 

target (40 points 

maximum) 

100 percent of target achieved: 40 points; 

90 percent achieved: 35; 

80 percent achieved: 30; 

70 percent achieved: 25; 

60 percent achieved: 20; 

50 percent achieved: 0 

Energy conservation 

measures (60 points 

maximum) 

Energy conservation leading group: 3 points 

Energy conservation management department: 2 

Decomposition of target to unit and person 3 

Assessment of energy conservation target 3 

Reward and punishment system 4 

Energy efficiency performance in 1000 enterprises: 10 for top 10 

percent and 5 for top 50 percent 

Energy conservation R&D fund 4 

Annual energy conservation plan 4 

Closure of backward equipment 7 

Retirement of outdated equipment 

Implementation of local regulation 2 

Implementation of energy consumption norm 4 

Norm management for energy consuming equipments 2 

Implementation of energy conservation design 2 

Energy audit and monitoring system 2 

Energy statistics manger and account 3 

Energy monitoring appliance 3 

Energy conservation training 2 

Further developing these program evaluation approaches might help China in addressing its future carbon mitigation targets and programs. As it moves from energy 

to carbon targets, there will be a need for integrated carbon accounting at the enterprise and possibly at the municipal and provincial level. The World Resources Institute has been working with Chinese partners on enterprise-level greenhouse gas 

accounting for four years. We have focused mainly in heavy industries, and our 

standards have been adapted for the cement and petroleum and petrochemicals sectors and are now being adapted for the power sector. These types of tools will enable 

Chinese enterprises and the Chinese government to better track their greenhouse 

gas emissions. 

It is also likely that the Chinese government will assign carbon dioxide intensity 

targets to provincial and local governments. The current energy intensity target is 

distributed to each of the provinces. The challenge for provinces is tracking all the 

economic activity within their boundaries, a much more difficult task in all countries than tracking national data, since provinces do not have enforced borders, control of a currency or customs agents. Current provincial energy data actually derives 

in part from bottom-up data from localities and local enterprises, but also top-down 

data from the central government, which receives data directly from many nationallevel companies. 

This complexity will continue to exist with the move to carbon intensity. Calculating CO2 emissions at the sub-national level is more difficult that accounting at 

either the national or the firm level, because the ‘‘boundaries’’ of the organization 

are not so clear. A program like the European Union Emissions Trading System 

(EU ETS), for example, accounts at the national and the firm level. Because of the 

need in China, a number of international groups are working in this area. We at 

WRI are currently examining the existing tools available internationally, including 

the French Ministry of Environment’s Bilan Carbone (Carbon Balance), and a tool 

produced by Local Governments for Sustainability (or ICLEI) to provide advise on 

how to best address this need. 

NBS is actively developing its carbon dioxide reporting requirements for China. 

These are not yet public, but from presentations at various conferences it seems 

clear that they are carefully studying the European system as well as the EPA’s 

GHG reporting rules. One area in which they seem to be looking closely at the 

EPA’s rules is in monitoring CO2 from coal-fired power plants. The EU system is 

an estimation system, based on energy use and emissions factors. EPA requires continuous emissions monitoring on coal-fired power plants, because of difficulties in 

measuring coal input as well as variation in the coal itself. While we do not yet 

know what China will choose to do, we know that researchers have been considering 

44 

the costs and complexity of adopting the U.S. approach. In the last two years China 

has required continuous emissions monitoring for SO2 from coal-fired power plants, 

and now a few provinces have introduced monitoring for NOχ. The equipment that 

monitors NOχ also measures CO2, but as yet it is limited to a few provinces. US 

EPA has provided some assistance to Chinese localities in areas such as calibrating 

SO2 monitors. If China were to rapidly deploy NOχ/CO2monitors, more technical assistance of this sort might help the program significantly. 

What types of metrics China will need for domestic implementation, as opposed 

to overall national accounts described above, in the future will be determined in 

part by the types of mechanisms it chooses to use. In our current research with 

Tsinghua University we are looking at the different requirements needed if China 

were to choose at some point to use a cap and trade system, a carbon tax or additional emissions standards, in contrast or in addition to the current emphasis on 

quotas. While both cap and trade and carbon tax require regular monitoring and 

reporting, a carbon tax, for example, offers the choice of imposing it upstream or 

downstream in the energy production chain. These two would both require more facility-level verification—at whatever level the allotments or tax is being imposed. In 

contrast, standards will require separate systems for different types of standards 

verification, a seemingly more complex option, but one where China already has significant experience. 

3. PROVIDING DATA TO THE PUBLIC (TRANSPARENCY)

Traditionally energy data is treated quite differently from environmental data. 

Energy agencies like the U.S. Energy Information Administration aggregate data, 

and the public are unable to see specific firm-level or facility-level information. 

Firms have traditionally viewed this data as confidential business information, 

which they give to governments, but governments then protect. Aggregated data is 

widely available and used, and in the energy area this aggregation was never considered a barrier to transparency. 

In recent years there has been a movement for transparency in climate data, 

which WRI supports. Transparency is a principle of our Greenhouse Gas Protocol, 

which we began to develop with the World Business Council on Sustainable Development in 1998.4 The earliest public mandate to provide facility-level climate data 

is within the European Emissions Trading, a system only established in the past 

decade.5 The U.S. EPA GHG reporting rule went into effect only in 2009. With an 

EPA requirement, this information is now public, but as you can see, this is very 

new. 

Private groups have also promoted the idea of carbon transparency. In particular, 

the Carbon Disclosure Project (CDP) surveys companies listed in 29 stock indices 

around the world. 2009 marked its seventh annual report.6 Participation rates 

range from 8 percent in Central and Eastern Europe to 95 percent among the UK’s 

FTSE 100.7 The China 1008 reported 10 firms or 10 percent reporting in 2009, double the number in 2008. While China’s number was quite low, it reflected a broader 

trend, with Russia and India also both below 20 percent; even Japan had only a 

37 percent reporting rate. The idea of GHG transparency in the Asian region is 

clearly just beginning. 

The general argument for making pollution data available is so the public can 

know the risks they are exposed to. Since climate change has global impacts, global 

totals are the best indicator of the public’s risks, and national-level data the best 

indicator of how each country is contributing to mitigating the risk. However, CDP’s 

argument is that investors need to know a company’s climate change risk (including 

both risks from dependence on GHG-generating energy and processes and from impacts) as part of the transparent information needed for a healthy market. 

Transparency can also facilitate better analysis and can actually help promote innovation in GHG mitigation. As noted above China has an uneven record with program assessment. Freely available data sets that enabled academics and others to 

develop new approaches to assessing and evaluating data would assist national and 

local level policymakers. At present much of the information needed for companies 

to make independent assessments, such as access to the actual emissions factors the 

government uses, are also difficult to access. 

Greater access to disaggregated data could thus facilitate investor and others’ 

evaluations of specific companies, innovation in the use of the data and tools, and 

the companies’ own efforts to manage their GHG emissions. This issue is not directly related to national-level accounting for inventory purposes, where nationallevel energy data can be used to calculate energy-related CO2 emissions, but rather 

is related to program assessment and once sub-national targets are assigned to target enforcement. 

45 

In summary, there is a difference between calculating energy and emissions data 

at the national level to track how a country is doing overall and the country’s own 

needs domestically for implementing, assessing and enforcing specific domestic programs and mandates. 

China has a long history of national-level energy accounting, and the reliability 

of this data has increased significantly, especially in recent years, when new systems were put in place to implement the energy intensity target under the 11th 

Five Year Plan (2006–2010). GHG Emissions accounting is relatively newer, going 

back to 1994, but China is actively involved in improving its systems in this regard, 

and because its international commitments are for energy-related CO2 emissions, it 

will be able to fully use the dataimprovements in its energy information systems 

to support its GHG data collection and analysis. 

1Taryn Fransen, ‘‘Working Paper: Enhancing Today’s MRV Framework to Meet Tomorrow’s 

Needs: The Role of National Communications and Inventories,’’ The World Resources Institute, 

June 2009. 2From interviews with the Energy Research Institute we understand these emissions factors 

to be more technology specific and less aggregated than the type that would generally be released to assist companies in making their own accounting. 3This information and the table are drawn from, Fei Teng, et al ‘‘Working Paper: Mitigation 

Actions in China: Measurement, Reporting and Verification,’’ the World Resources Institute, 

June 2009. 4See www.ghgprotocol.org for details on the program. 

5 Information on the EU ETS is available on the web at http://ec.europa.eu/environment/ 

climat/emission/index—en.htm 6 Carbon Disclosure Project 2009: Global 500 Report. www.cdproject.net 

7The CEP is a voluntary report and the level of participation varies with many companies 

submitting full GDP accounting, while others provide only much more general information. 8This appears to be CDP’s own selection of 100 top companies. It is not one of the standard 

stock indices, in contrast to the others in CDP’s compilation. 

Æ