Building codes and pollution control

But there is much more to be done. Energy efficiency alone cannot solve the air pollution and climate change problems, but it is the biggest and cheapest step. As Vice-Minister Xie Zhenhua of the National Development and Reform Commission said, "The cause of air pollution and climate change is the same - the burning of fossil fuel."

Many policies and measures, such as reducing coal consumption and controlling the number of motor vehicles, tackle both climate change and air pollution at the same time.

Other areas where China can make efforts to win the air pollution and climate change battles include drastically expanding renewable energy, a world-class air pollution control system and a new type of urbanization.

China's manufacturing abilities have driven the price of wind and solar energy down by 50 and 80 percent, respectively, in the last five years. This means that a clean energy future need not cost more than a dirty one - so the proper response is to increase the use of those technologies at a rapid pace.

Second, China needs a world-class air pollution control system. This will require not only setting strong standards for smoke stacks and tailpipes, but building the institutions that can monitor emissions, issue permits, and enforce reductions. There is no substitute for a modern environmental enforcement system, including independent inspectors with proper training and in sufficient number to get the job done.

Finally, there are fantastic opportunities in rethinking urbanization. Well-designed cities encourage biking and walking. Transportation should de-emphasize the car and instead offer clean, fast, efficient public transport. New cities should be laid out with a highly permeable grid of smaller blocks with mixed uses. In China, this kind of development pattern has cut transportation energy use by more than 50 percent.

These ideas together - an aggressive push for energy efficiency, the rapid adoption of renewable energy technology, an air pollution system with serious monitoring and enforcement, and a new approach to city layout - create a recipe for a clean and beautiful China, and a prosperous one too.

The author is CEO of Energy Innovation LLC and also a senior fellow at the Paulson Institute.