China orders compulsory energy-saving assessments of new fixed asset investments

China on Tuesday stepped up its efforts to boost energy conservation in the country, enforcing new rules demanding energy-saving assessments of new fixed asset investment projects. All new investments must undergo independent assessments and government reviews on whether they are energy-saving or not before being approved by regulators, the National Development and Reform Commission (NDRC), China's top economic planner, said Tuesday in a statement on its website.

"It is very important and urgent for us to curb excessive growth of energy consumption and raise energy use efficiency," the statement said.

According to the new regulations, independent institutions will carry out the energy-saving assessments while government departments will take charge of the review work.

Any fixed asset investment project that fails to meet the energy-saving requirements will be vetoed, according to the regulations, which take effect on Nov. 1 this year.

Those projects that pass energy-saving assessments and reviews will be subjected to strict supervision on their actual energy consumption.

According to the regulations, managers running a project with an annual energy consumption over 3,000 tonnes of coal equivalent must submit a detailed energy-saving report to government regulators.

Those who run a project with an annual energy consumption between 1,000 tonnes and 3,000 tonnes of coal equivalent will have to submit a brief energy-saving report.

While managers of projects which consume less than 1,000 tonnes of coal equivalent annually will only have to fill in government energy-saving registration forms.

Before the regulations take effect, there is no such compulsory restrictions on the country's new fixed asset investment project.

Li Zuojun, deputy director of Resources and Environmental Policy Research Institute under the Development Research Center of the State Council, said the rules are of great significance in China's rapid industrialization and urbanization process.

"Our country's industrialization and urbanization are mainly achieved through fixed asset investments, which consume a lot of energy," Li said, "thus the new rules are good for the government to restrain energy consumption from growing too fast and facilitate a reasonable use of resources."

China plans to cut its per unit gross domestic product (GDP) energy consumption by 20 percent at the end of 2010 from the 2005 level.

However, its energy consumption per unit GDP only dropped by 2.2 percent last year, failing to meet the annual target of 4 percent, according to data of the National Bureau of Statistics.