China must put even more electric cars on the roads at a faster rate to meet nation's 2060 carbon neutral target, Greenpeace says

Manufacturers and policymakers in China must work together to put even more zero-emission vehicles on the roads of the world’s largest vehicle market to meet the nation’s carbon neutrality target by 2060, Greenpeace said.

Zero-emission vehicles (ZEVs) will have to make up 63 per cent of total automobile sales by 2030, rising up to 87 per cent by 2035, for China to get on the path for meeting the 20 per cent emissions-cut target in 2035, according to research published by the environmental advocacy group on Tuesday.

“Cutting emissions is cumulative; the longer you wait, the more impossible it becomes,” said Bao Hang, a project leader in Greenpeace East Asia’s Beijing office.

The findings, which cannot be immediately corroborated, underscore the challenges and opportunities that lie ahead in the world’s fastest growing market for so-called new energy vehicles (NEVs), where three of every five new cars entering China’s roads are expected to be powered by electricity by 2030, according to a UBS forecast. Sales of NEVs made up a record 14.8 per cent of total sales last year in China, as generous subsidies and a steady flow of new models lured drivers to ditch their petrol-guzzling cars for fully electric models.

That replacement rate is not happening fast enough, according to Greenpeace. Vehicle emissions are expected to peak at 1.75 billion tons of carbon dioxide by 2027, with the reduction reaching a plateau of 1 per cent between 2027 and 2029, before peaking at 11 per cent by 2035. That would require extreme policies later to attain carbon neutrality by 2060.

“The premise of net zero commitments is an early peak and a long downhill, not a plateau and a cliff,” Bao said.

The transport sector accounted for around 10 per cent of China’s total carbon dioxide emissions in 2020, and was the third-largest source of carbon emissions in China, just behind its industrial and power sectors.

China has promised that emissions would peak by 2030, and reach carbon neutrality 30 years later – the car industry’s carbon emissions should peak in 2028, and drop to 20 per cent of peak levels by 2035, to reach net zero in 2060, according to the Chinese government.

The most effective policy for reducing emissions is to increase the replacement of vehicles powered by internal combustion engines (ICEs) with electric cars, including both battery-driven automobiles and vehicles running on hydrogen fuel cells (FCVs). Stalling on the sales targets could put carmakers at risk of failure later, Greenpeace said.

Policymakers will also need to set higher quotas for ZEVs sales into 2030, Greenpeace suggested.

In a development plan issued in 2020 for NEVs, the State Council ordered that by 2025, green vehicles including pure electric cars, petroleum-electric hybrids, and vehicles that run on fuel cells, should account for 20 per cent of all automobiles sold in China.

According to Greenpeace, the ideal response would be for Chinese carmakers to phase out internal combustion engine vehicles entirely by 2030. Anything later would jeopardise progress toward meeting the Paris Agreement target of limiting global warming to 1.5 degrees Celsius.

“Currently, carmakers in China are far behind. And especially foreign brands, which have a huge, influential presence in the Chinese market, are the farthest behind,” Bao said.

Volkswagen, which announced a 50 per cent sales target for NEVs by 2030, would need to raise that goal by 13 percentage points to reach 63 per cent. Honda Motors, which makes cars in Guangdong province, must add 23 percentage points to its 2030 NEV sales target of 40 per cent to reach the same, Greenpeace said.