GEF to Support China’s Energy Efficiency and Environment Programs

The World Bank’s Board of Executive Directors approved a US$17.8 million grant from the Global Environment Facility (GEF) to support development and implementation of China’s priority energy efficiency and environment programs, with a focus on improving the results measurement and verification system and developing market-based mechanisms.

China is the largest energy consumer in the world, relying on coal to meet two-thirds of its primary energy needs. Its energy consumption increased more than seven fold between 1980 and 2015, and is expected to double over the next two decades. The growth in energy consumption has led to twin challenges: environmental sustainability and energy security. China has some of the world’s most polluted cities and is the largest emitter of greenhouse gases in the world. It is also facing growing energy security concerns because of the increasing dependence on oil and gas imports.

“Improving energy efficiency is the most cost-effective way to simultaneously address these challenges. It produces energy savings, conserves scarce natural resources, improves local air quality, and enhances energy security. Energy efficiency can make the single largest contribution to achieving the government’s targets to reduce energy intensity and curb carbon emissions,” said Todd M. Johnson, World Bank’s Lead Energy Specialist and project team leader.

The GEF-funded Developing Market-based Energy Efficiency Program in China will support the national government’s efforts to develop measures and policies to reduce coal consumption and encourage energy efficiency, establish principles, methodologies and guidelines for energy saving measurement, reporting and verification, design and pilot the energy consumption trading scheme, and build the relevant capacity for government officials, third-party verifiers, energy service companies, priority enterprises, and provincial energy efficiency centers.

In addition, the project will support the implementation of two major World Bank-financed operations, i.e. the Innovative Financing for Air Pollution Control in Jing-Jin-Ji Program, and the Hebei Pollution Prevention and Control Program, by undertaking marketing and business development for green energy financing, providing analytical studies, technical assistance and training, verifying results by independent and credible third parties, and disseminating lessons learned.

The Global Environment Facility (GEF) unites 183 countries in partnership with international institutions, civil society organizations, and the private sector to address global environmental issues while supporting national sustainable development initiatives. An independently operating financial organization, the GEF provides grants for projects related to biodiversity, climate change, international waters, land degradation, the ozone layer, and persistent organic pollutants.