The Challenge of Reducing Energy Consumption of the Top-1000 Largest Industrial Enterprises in China

In 2005, the Chinese government announced an ambitious goal of reducing energy consumption per unit of gross domestic product (GDP) by 20% between 2005 and 2010. One of the key initiatives for realizing this goal is the Top-1000 Energy-Consuming Enterprises program. The energy consumption of these 1000 enterprises accounted for 33% of national and 47% of industrial energy usage in 2004. Under the Top-1000 program, 2010 energy consumption targets were determined for each enterprise. The objective of this article is to evaluate the program design and initial results, given limited information and data, to understand the possible implications of its success in terms of energy and carbon dioxide emission reductions and to recommend future program modifications based on international experience with similar target-setting agreement programs. Even though the Top-1000 program was designed and implemented rapidly, it appears that – depending upon the GDP growth rate – it could contribute to somewhere between approximately 10% and 25% of the savings required to support China's efforts to meet a 20% reduction in energy use per unit of GDP by 2010.