Negotiating a Low Carbon Transition in China: Aligning Reforms and Incentives in the 12th Five Year Plan

2010-007
Discussion Paper
Negotiating a Low Carbon Transition in China: Aligning Reforms and Incentives in the 12th Five Year Plan

This paper analyzes the content and incentives for low carbon reforms in China’s 11th and 12th Five Year Plans. The analysis finds that China adopted a progressive slate of command-control reforms in the 11th Five Year Plan and strengthened their implementation with performance-based compliance incentives. In the 12th Five Year Plan China appears likely to adopt a more varied set of command-control and market-oriented reforms that would benefit from a more varied set of national and international compliance incentives. The paper concludes that it is therefore in both China and the international community’s interest to come to a mutually agreeable accommodation on the MRVing of unilateral NAMAs. Moreover, the paper suggests that provisions for international consultation and analysis (ICA) and fast track financing in the Copenhagen Accord could help advance climate negotiations at COP 16 and enable a low carbon transition in China.

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