Something weird is happening. There's a view forming that the greatest emitter of greenhouse gases has peaked in its production of those planet-warming emissions, and that the next step is for them to reverse year after year. You know who we're talking about.

They're also the world leader in the development of green technologies. What China has been doing in terms of renewables is something no one has really done. It's at the heart of the problem of climate change, contributing so much to the emissions

over the last few decades, but it is also at the heart of the solutions. If China really has hit peak emissions, its journey to carbon neutrality could be underway. Unless that is, a cold economic force is building just up ahead.

China accounts for more than 30% of carbon emissions globally. This may not surprise you. What might is how long it's taken for that to become the case. If you look at a country like the UK, which began its industrial revolution

in the late 1700s, or the US, where it began in the late 1800s, it took decades, maybe even centuries, for the country's emissions profiles to sort of slowly rise and then hit a peak and then slowly fall.

China has done that all in fast forward. It's industrial revolution really only began in the 1980s, after Deng Xiaoping's economic reforms, and it's seen a huge, massive increase in emissions since then. This line, which tracks China's emissions over the past couple of decades, speaks

for itself, and loudly in comparison
with these other big polluters. Powering some of that rise
is this stuff, and lots of it. Coal is the most polluting fossil fuel. It emits twice as many greenhouse gases
as natural gas.

And China is absolutely full of it. China's power system is very heavily
reliant on coal power, and that is the largest contributor
in terms of China's domestic emissions. China mines and burns half of the world's
coal in order to power its economy.

An economy of 1.4 billion people,
no less, and rooted in heavy industry, literally producing
the building blocks for factories the rest of the world has grown
to depend upon. Any time a country imports
something from China, it's in essence,

exporting its own pollution to China that
it would have emitted at home otherwise. But growing international prominence inspired a rethink within Beijing's
halls of power. The turn of the Olympics was
when China really started thinking about things
like electric vehicles and clean energy,

because they wanted the skies
to start to clear up. And at the same time, they realized
that there was a huge economic opportunity here. Chinese companies were several
decades behind Western companies in a lot of technology. But if they could leapfrog them
by skipping over internal combustion

engines and going straight to batteries,
building gas turbines and going straight to solar panels, then they could get out
from being this low end manufacturing and advanced straight
to high end manufacturing. Then came a new face of power. Under his leadership in 2014 and 2015,

China decided to set a goal of peaking its emissions before 2030. According to some estimates, it's this target that might already have been reached well ahead of President Xi's schedule. And he still has his other bigger goal.

That would be a big deal. And not only for China. The world would be in a better position to slow global warming, a key focus of November's COP29 summit in Azerbaijan. It could also help offset the impact of nations less interested

in reducing emissions. And we will frack, frack, frack and drill, baby drill. Donald Trump has already signaled his intention to withdraw from the Paris Agreement, just as he did in his first term. With China's already vast lead in terms of renewable energy investments,

it's the US that could soon find itself under more scrutiny when it comes to emissions. Over the last two decades, the Chinese government has set out a range of policies that set the direction for China to become a leader in certain green technologies.

That's meant investing money into research and development. In 2023, the amount China pumped into energy transition technologies eclipsed other nations. And if you look at the total amount of renewable energy China now generates, it's more than double that of the US.

Massive facilities like this solar thermal plant in northwest China, are products of the country's R&D spending. But so are more consumer-focused technologies like these, referred to as the new three. And they've become a very important focus for the Chinese government

to promote these industries domestically, but also for China to become
a global leader in those industries and to export them to
international markets. China produces 80% of global solar panels. That is huge. There's not really
any international competitor for solar.

Green technologies
became the top driver of economic growth last year in 2023, and accounted
for roughly 40% of GDP growth. Their companies are building
the biggest wind turbines in the world. Their batteries had the longest range of any batteries
in electric vehicles out there.

And generous government subsidies
consistently helped that, meaning developers could fund projects
even before they were cost competitive. And those subsidies were offered year
after year, at great cost to China because officials knew taking them away
could hurt the market,

and those companies might fail. This is what happened in the US. This is what happened in Germany,
in Spain. The subsidies would get canceled,
and industries that popped up around the subsidies would get sort of cut off
at the knees. Even with significant government
support, the strength of China's green

energy innovation obscures the view of
what's happening outside the power sector. Things like steel and cement making, right
now, those emissions are coming down because of a drop in production thanks to
the property sector being in a lull.

But long term, they're going to still need
to produce those things. In short,
it could simply be that lower emissions are a side effect of China's
slower economic growth and that if its economy picks up again,
that progress could be pushed back.

The Chinese government and the companies
it supports will have a choice. Double down on renewables
and make China a global climate leader, or kickstart the old fossil fuel engines to power an industrial revival. But if emissions really have peaked, once you get beyond where we are
now into really cutting into emissions, 

going into industries
like steel and cement that are difficult to decarbonize,
into investing in the grid in a way that you can really start
to cut coal power out more heavily. Those are going to take
a lot more political willpower.

It's going to take difficult choices
that are going to cost people jobs and perhaps cost important companies
a lot of money. And that's the real question, though. Does China have the political willpower to back up
what's been so far a happy accident?

Has China Really Hit Peak Emissions?

Bloomberg Originals offers bold takes for curious minds on today’s biggest topics. Hosted by experts covering stories you haven’t seen and viewpoints you haven’t heard, you’ll discover cinematic, data-led shows that investigate the intersection of business and culture. Exploring every angle of climate change, technology, finance, sports and beyond, Bloomberg Originals is business as you’ve never seen it.


Bloomberg Originals

China's potential peak in greenhouse gas emissions and its role in global climate change.

A view is forming that China, the world's largest emitter of greenhouse gases, may have peaked in its emissions.

China is a significant contributor to climate change but also a leader in developing green technologies and renewables.

If China has truly hit peak emissions, its journey to carbon neutrality could begin, but economic factors could hinder progress.

China's rapid emissions increase contrasts with the slower rise and fall experienced by countries like the UK and US.

China's heavy reliance on coal for its power system is a major contributor to its emissions.

China's shift towards green technologies and renewable energy.

China's focus on electric vehicles and clean energy started around the time of the Olympics, driven by environmental concerns and economic opportunities.

China aimed to leapfrog Western companies in technology by focusing on batteries and solar panels.

Under Xi Jinping's leadership, China set a goal of peaking emissions before 2030, a target potentially already reached.

The Chinese government implemented policies to support green technologies, investing heavily in R&D and renewable energy.

China's investments led to the development of large-scale renewable energy projects and consumer-focused technologies.

Challenges and uncertainties in China's path to emissions reduction.

Lower emissions might be a result of slower economic growth, and a resurgence could reverse progress.

China faces a choice between prioritizing renewables or reviving fossil fuel industries.

Substantial efforts are needed to decarbonize sectors like steel and cement, requiring significant political will.

The real question is whether China possesses the political will to sustain its progress in emissions reduction.