18: Urbanization

In recent decades, hundreds of millions of people have moved from rural to urban areas in China. The percentage of Chinese people living in cities has grown from roughly 18% in 1978 to just under 65% today.¹

Urbanization often results in higher carbon dioxide (CO2) emissions due to demand for steel and cement as well as rising consumption levels. However beyond a certain level of per capita income, urbanization may reduce CO2 emissions as people move into denser urban spaces. The relationship between urbanization and CO2 emissions remains the topic of substantial research.²

The Chinese government has a range of policies to promote low-carbon urban development. This chapter provides background on urbanization in China and summarizes those policies.

Background

During the last decade, more than 235 million people moved from rural to urban areas in China. In 2021, seven Chinese cities (Shanghai, Beijing, Shenzhen, Chongqing, Guangzhou, Chengdu and Tianjin) had populations of more than 10 million people and 14 cities had populations between 5 million to 10 million. By 2030, roughly 75% of China’s population—more than 1 billion people—are expected to live in urban areas.³

China’s current stage of urbanization—with widespread and rapid construction of buildings, roads and other infrastructure—is energy intensive and produces significant carbon dioxide (CO2) emissions. In addition, Chinese urban residents typically emit more CO2 per capita than rural residents. Studies have found that:

• Cities contribute roughly 85% of China’s CO2 emissions.⁴
• Chinese urban residents emit roughly 1.4 times more energy-related CO2 on average than Chinese rural residents.⁵
• One hundred million people moving from the countryside to cities in China increases CO2 emissions an average of 200 million tonnes per year over five years.⁶
• The wealthiest 5.3% of the Chinese population, almost all of whom live in cities, have carbon footprints nearly four times greater than the Chinese average.⁷
• Urban agglomerations formed by megacities currently contribute roughly 78% of China’s GDP and 72% of China’s carbon emissions, which will be further increased to 90% and 83% respectively by 2030.⁸
• In 2019, the city with the highest carbon emissions (458 million tonnes) is Yulin in Shaanxi Province. The city with the lowest carbon emissions (1.49 million tonnes) is Ganzi in Sichuan province.⁹

Studies suggest that per capita CO2 emissions in Chinese cities peak at approximately $21,000 per capital GDP (2011 PPP). Above that level, as Chinese cities get wealthier, per capita emissions tend to decline.¹⁰ There is evidence of a statistically significant negative relationship between population density and per capita emissions, even after controlling for income, economic structure and proxies for environmental policy.¹¹

Meanwhile, urbanization also has implications for carbon sinks. As forests are cleared to build cities, carbon stored in trees, other plants and soil is released into the atmosphere. However at least one study has found that urbanization in China can lead to long-term growth in carbon stocks as (i) urban tree planting and greening increases carbon stocks in cities after an initial loss, and (ii) carbon stocks increase in rural areas with less dense populations.¹²

Policy

The Chinese government promotes urbanization as a matter of policy. The 14th Five-Year Plan sets a target for the urbanization rate to reach 65% at the end of 2025 (a goal that has almost already been achieved).

At the same time, in light of President Xi’s commitment to peak carbon emissions by 2030 and reach carbon neutrality by 2060, greening the urbanization process has become an integral part of policy planning. The 14th Five-Year Plan includes the following goals for 2025:

• The percentage of days with good air quality in cities should rise to 87.5%.¹³
• Implement recycling transformation in industrial pilot parks.¹⁴
• Build 100 “zero-waste” cities and promote zero-waste development in each province.¹⁵
• Apply green building standards, including low-energy consumption and net-zero emission, to all new buildings.¹⁶
• Construct 50 million m2 of new buildings with low-energy consumption and net-zero emissions. Renovate 350 million m2 in existing buildings by adopting energy-saving designs.¹⁷

In June 2022, the State Council approved a new urbanization plan for the 14th Five-Year Plan period (2021–25) submitted by the National Development and Reform Commission (NDRC). According to the State Council Information Office, the plan should “promote healthy, livable and safe urban development” and focus on “high-quality urbanization.”¹⁸

In 2021, the State Council released the Opinions on Promoting the Green Development of Urban and Rural regions¹⁹ which sets the overall goals for 2025 and 2035. It lays out in broad terms an ambition to formalize a green development mechanism and policy system for urban and rural development in order to reduce pollution in cities by 2025. The Opinions aims for a comprehensive urban and rural green development system in each province and for carbon emission reductions to further accelerate by 2035.²⁰

Meanwhile, the Plan to Peak Emissions in Rural and Urban Construction,²¹ issued in 2022, outlined more detailed targets. The Plan includes an ambition to build ecological corridors, improve urban transportation and commuting, save energy by speeding up the renovation of existing buildings and promote the use of renewable energy in buildings. Specifically, the Plan calls for:

• Covering 50% of new-build public buildings and factories in towns and cities with solar panels by 2025. This complements a policy to install solar PV on existing buildings issued in June 2021.²²
• Retrofitting public buildings so that they are 10% more energy efficient than current levels by 2030.

The Plan to Peak Emissions in Rural and Urban Construction also addresses land and water usage and includes a goal for urbanized areas across the country to achieve an average of 45% permeable land by 2030, a measure to protect against flooding. Cities are also instructed to maintain green land, which should reach 38.9% of urban land by 2030.

If implemented, these plans could significantly impact China’s energy consumption and emissions profile. For instance, demolished buildings in China are on average 25–30 years old, despite a designed service life of 50–100 years. Tsinghua’s Institute of Climate Change and Sustainable Development estimates that the massive demolition and construction of new buildings leads to as much as 40 to 50 Mt of steel and 220 to 260 Mt of cement every year.²³ When taking into account the energy consumed in the construction process, this results in an additional 120 mtce of energy consumed every year, or 5% of global energy consumption. In response to these challenges, targets for prefabricated buildings (40%) and construction waste were specified in the Plan to Peak Emissions in Rural and Urban Construction.²⁴

Meanwhile, as part of China’s afforestation strategy linked to urbanization, billions of new trees have been planted while the move into dense urban areas has left large tracts of land behind. In addition, the Chinese government’s ecological civilization policy has mandated percentages of urban parks, trees, green roofs and vertical gardens. At the same time, the population decline in rural areas has provided more space to plant new trees in the countryside. One study found that only 6% of urban expansion has come at the expense of forested land. New development has primarily replaced agricultural land (81%) and grasslands (10%)—types of vegetation that have low-carbon storage potential compared to tree cover. Despite cities having made the biggest inroads into agricultural land, China’s agricultural area has only shrunk by 3.8% between 2002 and 2019.²⁵

Low-carbon cities

The central government also uses pilot projects to promote low-carbon cities, while cities introduce their own plans to peak and reduce emissions.

In 2022, the Institute of Public and Environmental Affairs and China Research Academy of Environmental Science assessed the emissions of 110 major cities and their efforts to peak emissions. The more economically developed regions such as Beijing–Tianjin–Hebei, the Yangtze River Delta, Guangdong–Hong Kong–Macao Greater Bay Area, which account for 42% of China’s GDP and 34% of heat-trapping gas emissions, were found to be leading the carbon peaking process, with most progress seen in cities that introduced low-carbon pilot projects.²⁶

Another study released in 2022, assessing CO2 emission inventories of 287 Chinese cities from 2001 to 2019, showed that 38 cities managed to proactively peak their emissions for at least five years and another 21 cities were able to reduce emissions, albeit passively. The 38 cities that proactively peaked emissions managed this through efficiency improvements and structural changes in energy use, while the passive declines in emission were related to economic recession or population loss.²⁷ Maintaining future emissions reductions will therefore require different policy approaches in different cities. In recognition of this, the 14th Five-Year Plan encourages cities to strive to peak emissions before the national goal of 2030.²⁸

Low-carbon development pilot programs have been part of China’s green cities programs for more than a decade:

• In 2010, the NDRC issued the Notice on Carrying Out Pilots of Low-Carbon Provinces and Cities, calling for dozens of low-carbon city pilots to be launched around the country.
  In 2016, the 13th Five-Year Plan for Controlling Greenhouse Gas Emissions highlighted low-carbon urban development as a core part of China’s strategy for controlling emissions. The Plan calls for low-carbon transit systems, energy efficient urban buildings, methane recovery at municipal landfills and more.²⁹
• Also in 2016, the State Council and Communist Party Central Committee released urban development guidelines giving priority to the development of mass transit and calling for “the construction of energy-saving cities”.³⁰
• In 2016, the NDRC launched the Working Plan for Pilot Programs on Climate-Adaptable Urban Development. The Plan calls for 30 pilot cities to develop and implement climate adaptation plans.³¹

In September 2020, a senior Ministry of Ecology and Environment official reported that China had developed at least 6 low-carbon provinces, 81 low-carbon cities, 52 low-carbon industrial parks, more than 400 low-carbon communities and 8 low-carbon pilot cities.³²

The Chinese government reports on these pilots in its Biennial Update Reports to the UNFCCC and annual Actions for Addressing Climate Change, among other places.

• According to China’s First Biennial Update Report (December 2016), CO2 emissions per unit of GDP in these pilots fell 19.4% from 2010 to 2014—faster than the national average.³³
• According to China’s Second Biennial Update Report (December 2018), there are now more than 400 provincial pilot low-carbon communities.³⁴
• According to the State Council Information Office’s report Responding to Climate Change: China’s Policies and Actions (October 2021), the Chinese government has launched low-carbon pilots in 10 provincial-level units and 77 cities.³⁵