China’s National People’s Congress, the country’s top legislature, approved the country’s first-ever Energy Law on 8 November 2024 at the 12th session of the Standing Committee Meeting. The Energy Law has taken effect on 1 January 2025. The release of this law, 18 years after the legislative process began, strengthens the legal framework governing China’s energy sector, supports energy security, and facilitates the country’s energy transition. As the foundation for the regulation of the energy sector, the Energy Law will also provide guidance and coordination for other sectoral legislation and policies.
Structure
The Energy Law consists of nine sections and 80 articles. It covers general provisions and details on topics such as energy planning, development and utilisation, energy markets, energy reserves and emergency measures, energy technology innovation, supervision and management and legal responsibilities.
Highlights
The Energy Law prioritises addressing carbon emissions and sets a clear overarching goal: facilitate China’s carbon peaking and neutrality targets while ensuring energy security. It marks a shift from the previous dual-control system for energy consumption to a dual-control system for carbon emissions. Article 5 mandates the acceleration of establishing this system, including mechanisms for total carbon emission and carbon intensity control.
The law also highlights the role of market. Article 6 calls for the establishment of a unified energy market system and the regulation of market order. The fourth section specifies requirements for all aspects of the energy market.
Provisions for an energy standard system also exist, underscoring the Energy Law’s importance in supporting China’s energy transition. Article 8 aims to establish a standard system to ensure energy security and promote low-carbon development, energy technology, and industry evolution.
Renewable energy development and consumption is the central focus of the Energy Law. The text provides specific requirements for various types, including hydropower, wind, solar, biomass and more in Articles 24–26, along with the definitions in Article 73, not only for renewable energy but also for fossil energy, non-fossil energy, and hydrogen. The law supports both centralised and distributed renewable energy systems, laying a legal foundation for distributed power trading, microgrids and other innovative business models. Article 23 mandates setting and meeting minimum renewable energy consumption targets, placing responsibility on different stakeholders, including power suppliers, electricity sales companies, consumers and captive power plants. Therefore, the Energy Law clarifies that the responsibility for renewable energy consumption is no longer solely on grid companies but is shared by multiple parties. This shift emphasises a broader participation in renewable energy consumption. Article 34 advocates the Green Electricity Certificates (GECs) system to incentivise green energy consumption, thus enhancing their importance in supporting the low-carbon energy transition.
The Energy Law places both coal- and gas-fired power plants in a supporting role. Article 28 focuses on improving the coal consumption structure, promoting the clean and efficient use of coal, and underscores the role of coal as a basic safeguard and system regulator in the energy supply system. Article 32 calls for enhancing the flexibility of coal-fired power generation for guaranteeing stable power system operation and electricity supply security.
Strengthening grid infrastructure to support a renewable energy-dominated new power system is emphasised in Article 31, especially for the coordinated development of generation and grid infrastructure, intelligent grid upgrades, and the construction of smart microgrids.
The Energy Law also recognises the role of new technologies in supporting energy transition. Articles 32 and 33 address the importance of energy storage and hydrogen technology.
The long journey of China’s Energy Law
The legislative process for the Energy Law began in 2006, with the first draft released for public consultation in 2007. Subsequent drafts were released in April 2020, April 2024, and September 2024. The April 2024 draft was deliberated during the ninth session of the Standing Committee of the 14th National People’s Congress, and the September 2024 draft underwent a second deliberation.
Compared to the 2020 version, the 2024 drafts and the final law are shorter, emphasising pragmatism over extensive logical structuring.The September 2024 draft introduced clearer definitions of energy types in its supplementary provisions. The final version also further refined measures for energy demand-side management, elevated provisions for regulating energy emergencies into a standalone article and added an article prohibiting discrimination and restrictive measures in international energy trade and business.
Original source: NEA (2024), Energy Law (CN)
Article: China Daily (2024), Maiden energy law expected to hasten green wave (EN)
