Energy saving, pollution control

Wen vowed that the government will meet the energy saving and pollution control targets between 2006 and 2010 despite last year's setback.

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The Chinese government set the goal of reducing energy consumption per unit of gross domestic product by 20 percent and major pollutants discharge by 10 percent in the Eleventh Five-Year Plan.

China's energy consumption per unit of GDP in 2006 went down 1.2 percent, and oxygen chemical demand and sulfur dioxide emission rose 1.2 percent and 1.8 percent, respectively, said Wen.

He said the country fell short of the targets set at the beginning of last year for cutting energy consumption per unit of GDP by four percent and discharge of major pollutants by two percent.

"The targets can't be revised and we must work resolutely to reach them," Wen said.
He noted that the State Council, or cabinet, will make annual reports on the progress made in saving energy and reducing major pollutants discharge to the NPC starting this year, and report on the overall progress made over the past five years at the end of the Eleventh Five-Year Plan period.

He blamed slow industrial restructuring and over-heated growth of the heavy industry, especially the highly energy-consuming and polluting sectors, for failure to attain the two goals.

"Lots of outdated production facilities are still in operation. Meanwhile, some local governments and companies failed to strictly comply with laws, regulations and standards on energy saving and environmental protection," Wen said.

Official statistics show the growth gap between the light and heavy industries expanded to 4.1 percent for the whole year of 2006 from 1.8 percent in the first half.

NPC deputy Liu Cigui, acting mayor of southeastern coastal city of Xiamen, said that it would be much harder to meet the targets if the irrational industrial restructure were not improved as soon as possible.

Wen pointed out in the report that China will not approve any new projects that fail to pass the government's energy saving and environmental impact assessment, and will close down any businesses that fail to comply with the energy saving and pollution control standards.

He also said the government plans to shut down small coal-fired power plants with total electricity generating capacity of 50 million kilowatts between 2006 and 2010 and shut down outdated production facilities in steel, cement, electrolytic aluminum, ferrous alloy, coke and calcium carbide industries.

Zhu Hongren, deputy director of the economic operation bureau at the National Development and Reform Commission (NDRC), said China's current extensive economic growth has gone beyond the bearing ability of the environment and resources. "We are left with no other alternatives but to meet the targets," said Zhu.

Wen said the government would apply a full range of economic levers such as pricing, government finance, taxation and credit to promote energy saving and environmental protection.

The government will deepen the reform of pricing system for major resource products and charges for pollution emissions, improve the system of taxes on resources and strengthen the compensation system for mineral resources exploitation. "It will take time for the relevant policies and measures to produce the desired results," he said.

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