Understanding the Nature and Rationale of Carbon Neutrality

Abstract

To achieve carbon neutrality, it is necessary to grasp the essence of carbon neutrality. This paper looks into a few fundamental issues of carbon neutrality, and provides an in-depth analysis from the perspectives of environmental sustainability, technological innovation, economic viability, energy security, and international cooperation. It is shown that efforts for carbon neutrality need to focus on the key carbon dioxide (CO2) emissions from fossil fuel combustion. Fossil energy is considered to play a role as a short-term “ballast stone”, but its attributes decide that it can hardly lead to a sustainable future, and its phasing-out is inevitable. Disruptive zero-carbon energy production and revolutionary technological innovation in its consumption are accelerating that phasing-out process; the zero-carbon-oriented carbon neutrality goal is growing more resilient to market headwinds and releasing momentum for high-quality development. Carbon capture and carbon sinks are indispensable, but they are unable to provide a satisfactory path to carbon neutrality. Carbon neutrality requires substantial capital investment, which can be provided by zero-carbon products with ever-increasing market competitiveness. Investment in high carbon fossil fuel industry can be risky. High carbon lock-in not only increases the difficulty of carbon neutrality, but also intensifies the risk of energy security, and it is difficult to avoid the risk of market crowding-out, resulting in huge amounts of capital waste. Consequently, decarbonization is the trend of the times, giving an edge on seeking international justice and a louder voice in the international community, and also the focus of market competitiveness. However, the target year for carbon neutrality in China is before 2060, indicating that carbon neutrality is not a short-term goal. Therefore, it is impossible and unnecessary to have it realized overnight. The opportunity of carbon neutrality should be well taken for quality growth of the economy and enhancement of people’s well-being. Carbon neutrality is a long-term process which calls for thorough plans and step-by-step actions. It is also evident that along with energy revolution, carbon neutrality also brings revolutionary transformation of relations of production and development paradigm.