(Yicai) July 10 -- China updated new climate targets plan through 2030, stepping up its push to ensure the country reaches peak carbon emissions on schedule while accelerating the transition to cleaner energy.

The State Council aims to cut carbon dioxide emissions per unit of gross domestic product by 17 percent from 2025 levels by 2030 and raise the share of non-fossil fuels in total energy consumption to 25 percent, according to a plan released yesterday. The plan also calls for new electricity demand to be met by additional clean power generation wherever possible.

The latest roadmap builds on China's Action Plan for Carbon Dioxide Peaking Before 2030, released in 2021, which laid out the country's overall decarbonization strategy. It also sets new targets for accelerating the energy transition, including raising total installed wind and solar power capacity to more than 2.8 billion kilowatts by 2030, expanding distributed photovoltaic systems, speeding up the construction of ultra-high-voltage transmission corridors, and accelerating the development of virtual power plants.

Analysts said the measures would also strengthen China's energy security. Lv Wenbin, director general of the Energy Research Institute, a top national think tank under the Academy of Macroeconomic Research and the National Development and Reform Commission, and Tian Zhiyu, director of the institute's Sustainable Development Center, wrote in a jointly authored article published yesterday that, amid current global uncertainties, China faces growing challenges in safeguarding both energy and industrial security. Expanding clean energy generation to meet new electricity demand would fundamentally reduce the country's reliance on imported fossil fuels, they said.

Industry participants said the plan's key focus is the requirement to ensure new electricity demand is covered by additional clean energy generation. They added that future growth in wind and solar installations will depend not only on the pace of project construction but also on improvements in power system dispatch, demand-side consumption capacity, and electricity pricing mechanisms.

"Currently, distributed PV projects are experiencing an overall decline in returns," an executive at the regional branch of a central state-owned energy company recently told Yicai. “We are exploring participation in virtual power plants through project aggregation, but we have not yet seen a clear profit model.”

The executive said aggregated distributed PV projects currently participate in virtual power plants mainly through demand response and ancillary services markets. However, invitations to participate in these markets remain too infrequent for companies to accurately assess project economics, and further improvements to pricing policies are needed.

Editor: Emmi Laine