US and China Announce Joint Greenhouse Gas Emission Reduction Commitments

November 17, 2014


On November 12, 2014, China and the United States reached an agreement on greenhouse gas (GHG) emissions reduction commitments and issued a joint announcement in Beijing. According to the announcement, the U.S. intends to reduce net GHG emissions by 26–28% below 2005 levels by 2025 (consistent with prior U.S. Obama administration policy). China pledged that its GHG emissions will not increase after 2030 with an effort to reach peak emissions at an earlier date. In addition, China has targeted a 15% increase in the use of non-fossil fuels in primary energy consumption by 2015 and 20% by 2030.

The significance of this agreement is both symbolic and practical. It reflects China’s foremost commitment to limit GHG emissions and to change its energy consumption. In addition, this agreement is likely to spur other countries to tackle climate change issues and possibly achieve an agreement binding all parties at the United Nations Climate Conference in Paris in 2015.

The Obama administration will face challenges from Congress to meet its commitment, but these are substantially the same as the opposition to the EPA power plant GHG reduction rule issued in June of 2014 [covered here in previous alert]. China has already been proactive in taking measures to meet its commitment. Upon approval from China’s State Council, on September 19, 2014, the National Development and Reform Commission issued a detailed blueprint on how to address climate change for the period of 2014 to 2020. Among other goals, the blueprint has laid out major emission reduction goals for 2020, which include: (1) reducing carbon dioxide emissions by 40–50% below 2005 levels; (2) increasing the use of non-fossil fuels to around 15% by 2015, and (3) increasing forested areas by 40 million hectares (100 million acres) and available forest stock by 1.3 billion cubic meters from 2005 levels. In addition, to facilitating emissions reductions, the blueprint provides commitments to use renewable and zero emission energy resources, such as wind, water, nuclear, solar, biomass, and other renewable energy resources.

This memorandum is a summary for general information and discussion only and may be considered an advertisement for certain purposes. It is not a full analysis of the matters presented, may not be relied upon as legal advice, and does not purport to represent the views of our clients or the Firm. Qiang Li, an O'Melveny partner licensed to practice law in New York, Alan Bao, an O'Melveny associate licensed to practice law in California, and Eric Rothenberg, an O'Melveny partner licensed to practice law in Missouri and New York, contributed to the content of this newsletter. The views expressed in this newsletter are the views of the authors except as otherwise noted.

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