U.S.-China Climate Deal: Setting the Record Straight

Misleading Charges and How to Get the Story Right

The surprise announcement of a major agreement between China and the United States has pundits scrambling for description. While most have gotten the story right, there are a number of misleading charges being leveled at the deal. Here, we hope to set the record straight on this historic agreement. 

  • China has already started taking action to reduce emissions (more)
  • A 2030 emissions peak means that China needs to pursue a much faster transition to clean energy.​ (more)
  • This sends a clear message to business to invest in clean energy and to other nations that we are on board with reducing emissions (more)
  • These goals are stronger than others, but still pragmatic (more)
  • Reducing emissions is good for the economy (more)
  • President Obama’s agreement reflects the public demand for clean energy. (more)

China is already taking action on climate change

Claims that this allows China to do nothing for 16 years ignore the facts. China has already taken multiple significant steps to start reducing emissions, and will require even more significant and verifiable action to peak emissions in 2030 or sooner, as pledged. To continue to suggest China could do nothing is to rely on an outdated excuse for inaction.  

This agreement follows prior indications that China is serious about addressing climate change. For example, the country started carbon markets in 7 regions in 2013, and has already planned to begin phasing in a national carbon market in 2016. They recognize the health threat of coal burning, having banned new coal plants in key regions. China is also the largest investor in green energy globally, as seven of the top ten photovoltaic firms in the world are either Chinese firms or have their manufacturing facilities mainly located in China. By supporting renewable and clean energy, China is fostering this sector growth and signaling to manufacturers that they can plan for a robust Chinese market share.

This actually isn’t the first agreement between the two economic powerhouses. In 2013 the countries agreed to limit hydrofluorocarbons, a powerful greenhouse gas. In July 2014, the US and China agreed to work together through business and research collaborations in order to share technology and begin developing solutions like Carbon Capture and Storage

Even still, the Chinese people are putting pressure on their leaders to cut emissions and improve air quality. This has elevated pollution as a key concern for the Xi administration and increased citizen support for climate action

A 2030 emissions peak means that China needs to pursue a much faster transition to clean energy.

Criticism that China is on track to peak by 2030 even without this agreement misstates the facts and ignores research to the contrary.  Analysts show that China's emissions would likely continue to soar past 2050 without concerted changes. Committing to an emissions peak as early as 2030 or before reflects the fact that China is still developing, having per capita emissions that are around a third of U.S. emissions. A recent MIT analysis found that in a baseline scenario China’s emissions would continue to rise well past 2050. With continued effort, however, emissions could peak somewhere between 2030 and 2040 and "accelerated effort" could bring a peak somewhere between 2025 and 2035. This pledge represents significant commitment by China.

This deal sends a clear signal to other countries, businesses, and civil society that the US and China are committed to clean energy research and development.

Pundits are criticizing the deal because it is not binding. Yet as an essential first step, it is a political signal intended to spur action across all sectors to speed up and support the clean energy transformation. It tells other nations as well as business that we are exiting the business-as-usual path and building a clean energy economy. Even non-binding targets send a clear message to investors. Tom Kiernan, CEO of the American Wind Energy Association (AWEA) has stated, “This agreement sends the right message to businesses and investors that scaling up clean energy not only benefits our economy, but will continue to be supported at the highest levels as something the world needs.”

The world is taking notice of this deal between the world’s two highest emitters. RussiaCanada, India, and Australia are all feeling new pressure to participate in climate policy. Australian Prime Minister Tony Abbott has indicated he intends to take climate change off the G20 agenda, but this deal makes it a highly difficult subject to ignore. The agreement is a precursor to an international agreement in Paris in 2015, where accountability standards are likely to be set. This means all eyes will be on China to ensure they are living up to this promise. 

These goals are ambitious but pragmatic, getting us closer to a pathway that keeps us below the 2°C limit.

Critics claim these goals are too weak and won’t accomplish anything. This ignores the fact that they are a significant improvement from past goals. It will take real effort to achieve these goals. China is already rapidly moving towards clean energy, with previous reports finding that a 20% renewable market share by 2020 is feasible under current investment and policy trends. Currently at 9.8% renewable energy, China will need to add 800-1,000 GW of clean energy, which would be enough to power the entire U.S. energy grid. While China’s renewable energy goal is attainable, these gains are also nothing to sneer at. Previously, China had only aimed to reach 15% renewable energy by 2020.

This deal nearly doubles the rate of reduction per the previous U.S. climate commitment of lowering emissions 17% from 2005 levels by 2025. In a sign of further ambition, this climate plan also exceeds past proposals in its domestic targets.  

Research by Climate Action Tracker has found that this plan moves China “closer to a pathway that is compatible with 2˚C,” and will go far towards the goal of avoiding catastrophic climate change. A separate analysis by Climate Interactivereports that "the new commitments by the US and China would, if fully implemented, keep 640 gigatons of CO2 from being emitted into the atmosphere. The total of 640 gigatons is greater than all global fossil fuel emissions from 1990-2013." 

Growing the clean energy industry is good for the economy.

Cries that this will be bad for the economy follow a long tradition of hyperbolic and ultimately incorrect predictions that environmental protection will destroy the economy. In reality, decades of successful environmental protection prove otherwise. For example, the Northeast’s Regional Greenhouse Gas Initiative has proven (.pdf) that the economy can grow while emissions drop. Two of the EPA’s Clean Power Plan’s building blocks, energy efficiency and renewable energy, are increasingly economically feasible options for electric utilities. Energy efficiency is the lowest-cost energy resource and the cost of renewable energy continues to decline dramatically and is quickly becoming cost-competitivewith fossil fuels. The deal supports the EPA’s efforts, helping to spur job creation and opportunity in the growing clean energy sector. This is because extra renewable capacity and installing energy saving efficiencies will employ resources that otherwise wouldn’t be put to use. According to Dean Baker, the co-founder of the Center for Economic and Policy Research, the construction sector still has one of the highest rates of unemployment of any in the country and “people in construction absolutely have the skills to put in solar panels and to add insulation to homes.”

Many utilities are now signing clean energy deals based on cost alone. Clean energy is projected to get even cheaper as the cost of solar panels and wind turbines continues to decrease. Market price aside, fossil fuel power has huge hidden costs that aren’t included in the price people pay for electricity. Accounting for the hidden costs of coal in the U.S. conservatively doubles to triples the price of electricity from coal per kilowatt-hour generated. To take a related example, the Clean Air Act was attacked early-on as an economy killer, but its overall benefits to health and the environmental outweighed costs by 30 to 1

President Obama is responding to the demands of the public.

Opponents charge that with this deal, Obama is overreaching his authority. In fact, he is acting well within his powers, and is upholding democracy by recognizing the overwhelming public support for clean energy. 91% of Americans think it’s a good idea to generate electricity from the sun, and 84% from wind. 67% support government investment into renewable energy research.

This plan is pragmatic, with CFR’s Michael Levi noting that “the administration appears to be putting forward the most it thinks it can do on all fronts.” A gridlocked Congress would be unlikely to approve a formal, binding treaty, leaving a non-binding agreement as a next best option. It may not be ideal, but it is still a significant sign of commitment. President Obama says that the emission cuts can be reached by enforcing existing EPA rules and promoting clean energy.