Climate change remains one of the bright spots in an otherwise challenging bilateral relationship. Fan Dai, Director of the California-China Climate Institute, outlines the similarities between the US and China’s climate goals, explores ways they can both achieve net zero objectives, and offers insight on China Special Envoy for Climate Change Xie Zhenhua is climate diplomacy strategy.
Fan Dai is the Director of the California-China Climate Institute. Dr Dai has played a significant role leading California’s collaboration with China on climate, energy and environment. She was appointed by Governor Edmund G Brown Jr as Special Advisor on China. Under Brown, she chaired the state’s China Interagency Working Group, and acted as the state’s liaison on its critical economic and environmental initiatives on China. Previously, Dai served as senior advisor at the California Environmental Protection Agency and the California Governor’s Office of Business and Economic Development, advising on the state’s international policy and global climate partnership. In 2017, she organized Governor Brown’s trip to China, which resulted in a successful meeting with President Xi Jinping and the commitment to establish the California-China Climate Institute.
Dr. Dai is a graduate of Berkeley Law, University of California, and holds a doctoral degree on Environmental Policy and Economics from the State University of New York. Her research has been focused on market mechanisms for climate change mitigation, energy efficiency, and innovations.
As the director of the California-China Climate Institute, what are your main goals for the Institute, both in the long and short term?
Fan Dai: We set up the Institute in 2019 with the mission to accelerate climate solutions, specifically in California and China. Our long-term goal is to provide policy projections, pathways, and climate solutions to encourage countries to meet their mid-century net zero or decarbonization targets set during the Paris Agreement.
Those long-term aims inform much of the work we do in the near-term. The Institute has four pillar programs: climate research, climate dialogue, training, and solutions. These four pillars are informed by our long-term goal of making the decarbonization pathway clearer, by providing countries with accessible climate change solutions.
The Climate Institute is led by former California Governor Jerry Brown, in partnership with Xie Zhenhua, and you also previously served as a special advisor to Brown on China and international policy. What do you think is the impact of his legacy and the future of climate change in California?
Fan Dai: Governor Brown is one of the foremost thought leaders on climate. Under his leadership, California became an international model for climate change and decarbonization. California has the fifth largest economy in the world, and it’s a large and complex economy. Governor Brown demonstrated that it’s possible to grow the economy while simultaneously steadily decreasing emissions.
He also set in place a suite of effective climate policies, including the Cap-and-Trade Program (led by the California Air Resources Board) and implemented energy efficiency standards for both buildings and appliances. I am grateful to see Governor Gavin Newsom carrying on this legacy and continuing to innovate on climate change policy. It is especially great to see how he is working to better embed climate policies into existing economic development targets.
What can China learn or replicate from California’s climate model?
Fan Dai: California has set a carbon neutrality target for 2045. That’s an incredibly ambitious goal, and the policies I mentioned previously – the Cap- and-Trade Program, energy efficiency standards – all contribute to this goal. One target for 2045 is to source 100% of electricity from renewable sources. While these targets are ambitious, California is actually achieving them step-by-step.
This kind of progressive, but realistic, policy implementation provides a good example for other jurisdictions. For example, we worked with China in 2015 on their pilot Cap-and-Trade programs. More recently, we offered support on the program design for China’s launch of their national emissions trading scheme. We have established regular lines of communication between California and China on how the program should be run and operated in terms of carbon registry, and how the trading proceeds should be spent.
You recently helped to author the first in a series of three reports called “Getting to Net Zero” on the US-China framework for carbon neutrality. What were some of your key findings and what are your predictions for bilateral climate cooperation?
Fan Dai: The first report is one we call a synthesis report. A key result of the report was the establishment of a framework to support coordination on carbon neutrality between the US and China. That included identifying technology pathways, common milestones, and priority areas for dialogue, research, development, and even multilateral leadership. On the national and sub-national collaboration between the US and China, the report revealed that it’s possible for the US and China to accelerate momentum and support each other to reach their respective climate goals. There are many commonalities, especially given that the US and China have similar pathways to achieve carbon neutrality. Another key finding of our report was interpreting those pathways into six pillars: energy demand and reduction, electricity, decarbonization, fuel decarbonization, electrification, and non-energy CO2 reduction and CO2 sequestration.
More specifically from those common mile- stones we identified, similar long-term goals and high-level strategies that the two countries could use to develop a shared carbon neutrality pathway for 2030, 2040, 2050, and 2060. While we could be perceived as overly optimistic in laying out mile- stones and opportunities for collaboration, you can already see cooperation happening at both a nation- al and sub-national level. To further facilitate that cooperation, we outlined some policy suggestions on how sub-nationals from each side could cooperate. At the national level, the aim was to identify a common pathway, to which those six pillars that I mentioned are the most important for early, urgent action. We will release two more reports – a US Re- view and a China Review – to examine each country’s domestic situations, and identify challenges and opportunities for them to decarbonize at both a national and sub-national level.
It has now been several months since John Kerry’s meeting with Xie Zhenhua resulted in a joint statement about climate cooperation. What actions have we seen since?
Fan Dai: Following that visit, President Biden hosted an Earth Day Summit which brought together the major economies, the largest emitters in the world, including China, to make pledges for further re- duction. President Biden also announced the US reduction target as 50-52% from 2005 levels by 2030. China defined their coal consumption target, aiming for peak consumption by 2025. In terms of federal commitments, Biden’s largest climate plan to date is the American Jobs Plan, which links climate change with the recovery and rebuilding of the economy. In China, provinces are currently undergoing the process of making their carbon emission peaking plans, which should be done by the end of the year.
What insights can you give us on Xie Zhenhua? How do you think he will tackle this bilateral issue moving forward, and do you think he will prioritize certain focus areas over others?
Fan Dai: The Institute recently convened a dialogue with Minister Xie and Secretary Kerry, along with a group of governors from the US and China. It was a good opportunity to compare notes with each other. My perception of his approach is that it is similar to Secretary Kerry’s. Both are focused on climate diplomacy, and we can see Minister Xie is taking a multilateral climate governance perspective. This multilateral approach is different when compared to a few years ago when he was the Vice Minister for NDRC, and it has been beneficial. US-China relations are very complex, and climate is just one part of it. Minister Xie has the ability to engage other countries rather than the US, and it seems like he will use that ability to take a multilateral approach on climate diplomacy.
A second observation was that I found what Kerry and Xie shared about the carbon neutrality pathways in the US and China to be very consistent. For China, the biggest pressure comes from the power and industry sectors. While China is working on phasing out coal, the US needs to get rid of oil – it’s a very similar problem. The US and China share a lot of things in common from the emission reduction perspective.
My final observation was in regard to nature-based climate solutions (NBS). NBS would seem to refer to different concepts in the US than in China. Currently, it is unclear what approach China intends to take to address emission reduction from different sectors and carbon sequestration, especially given that they are hosting the UN Biodiversity Conference in Kunming this year. I have not heard Minister Xie speak to that aspect very frequently, so China’s priorities remain somewhat undefined in that area.
Do you think it is possible that tensions be- tween the two countries could lead to a “beneficial competition” on climate change?
Fan Dai: To create real change, I believe we must have both cooperation and competition. There is an aspect of competition in technology that we need. We want to speed up the transition away from fossil fuels, to decrease prices, and increase the availability of solutions on the market. We should work to cooperate on areas where there is opportunity, and compete on areas like technology, where competition results in wider accessibility and lower-cost solutions. This benefits not only the US and China, but the rest of the world, too, providing more readily available climate solutions. These solutions should not be bounded by the bilateral relations between any countries.
China’s NDRC recently created a high-level working group to ensure that China meets its goals for peak emissions by 2030 and for carbon neutrality by 2060. How significant is the creation of that group and what sort of impact do you expect it to have?
Fan Dai: It’s a good step forward. The task force, led by Vice Premier Han Zheng, sends a very positive signal. In the past, one of China’s issues has been inter-agency coordination. Previously, there have been multiple agencies involved in this issue – the NDRC, the Ministry of Environment, the Ministry of Commerce – all responsible for different aspects of emission reduction. That is not the most efficient strategy, so the creation of the taskforce showcases that China is prioritizing carbon emission reduction and emission peaking. With Vice Premier Han leading the taskforce, the inter-agency coordination will be much more effective. Yet to be seen is how the national level coordination is going to pass down to the provincial and municipal levels.
If the US and China can find common ground on climate cooperation, what are the roles of American and Chinese businesses in this cooperation?
Fan Dai: Businesses have a huge role to play – it’s both a huge opportunity and a daunting task. Climate is not just an emission reduction task, it is an economic opportunity. Many will have to go through a fundamental change in both thinking and practices, from decarbonizing supply chains to production processes. We’re hearing more and more about businesses considering carbon emissions in their decision making. Tapping into private capital is also a huge opportunity to bring more investment, while simultaneously decarbonizing and driving revenues from the transition.
How has the fall out and recovery from COVID-19 affected climate politics and progress?
Fan Dai: The slowdown of the whole world last year makes sense for carbon emissions but not for economic development. Naturally, as the economy rebounds and recovers, we’re seeing emissions climbing again, but this is not a bad indicator. We have witnessed first-hand how it is possible to ad- dress big challenges when the federal government and society work together. Going forward, we will need to see how countries maneuver to prioritize economic recovery with climate mitigation and emissions reduction.
Of course, this is not only a domestic issue, but a global challenge. Globally there has been a lot of discussion about how we can use climate change as an opportunity. We cannot go back to investing in fossil fuel-related projects. It is imperative to start greening investments, both to stimulate economic development as well as to support climate mitigation.
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