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Contributing to more than 25% of global emissions, China plays a critical role in the global push for decarbonization and has been making rapid progress on this front with various national and sectoral policies alongside increasing adoption of core clean technologies. Invesco and Invesco Great Wall has been collaborating with Tsinghua University National Institute of Financial Research Center for Green Finance Research (CGFR) on a long-term research project deep-diving into China’s decarbonization pathway.
This 3-part blog series covers an in-depth overview into China’s climate transition and corresponding investment opportunities and implications. Investing in China’s transition story requires an in-depth understanding of national climate policies, implications on traditional sectors, technological roadmaps, and global developments. This blog series will examine each of these 3 areas:
1) China’s State of Decarbonization: Looking at drivers of emissions in China including key fuel source and industry contributions as well as understanding the policy developments and implications.
2) High Emitting Sectors Deep-Dive: Existing dependency on fossil fuels implies transition required in high emitting traditional sectors like coal, power, and steel, all of which requiring a combination of policy support (like 1+N Policy Framework) and technologies (like Electric Arc Furnaces for Steel production).
3) Technology Roadmap and Investment Opportunities: Assessing technological maturity and unit economics in areas of renewables (solar, wind), electrification (EVs, batteries) and other sectors (energy- hydrogen, nuclear, carbon capture and storage (CCS); industry and energy efficiency).
Part 1 – China’s State of Decarbonization
China plays a critical role in moving our world towards decarbonization and achieving net zero. This first blog looks at the drivers of emissions in China including key fuel source and industry contributions as well as understanding the policy developments and implications.
Part 2 – Decarbonizing High Emitting Sectors
The second blog in our series covers what is required to decarbonize high emitting traditional sectors in China like coal, power, and steel, all of which requiring a combination of policy support (like 1+N Policy Framework) and technologies (like Electric Arc Furnaces for Steel production).
Part 3 – Technology Roadmap and Investment Opportunities
In the move towards decarbonization, it is estimated that RMB 3-4 trillion of green investments are required annually to achieve China’s 3060 targets. The third blog in our series assesses technological maturity and unit economics in the areas of renewables, electrification and other sectors.
