(Source: China Petroleum Enterprise Magazine Issue 10, 2025)
Dong Xiucheng
On September 24, 2025, President Xi Jinping announced China’s new round of nationally determined contribution goals at the United Nations Climate Change Summit. The details are as follows: By 2035, China’s economy-wide net greenhouse gas emissions will be reduced by 7% to 10% from the peak, and we will strive to do better. Non-fossil energy consumption accounts for more than 30% of total energy consumption. The total installed capacity of wind power and solar power generation will reach more than 6 times that of 2020, and strive to reach 3.6 billion kilowatts. The forest stock volume reaches more than 24 billion cubic meters. New energy vehicles have become the mainstream of new sales vehicles. The national carbon emissions trading market covers major high-emission industries. A climate-adaptive society has been basically established. The new round of nationally determined contribution targets reflects China’s ambition and determination to address climate change, and marks the acceleration of China’s energy transformation. As an important pillar in the energy field, the petroleum and petrochemical industry occupies a pivotal position in the national economy and assumes important historical responsibilities and missions in the context of reducing carbon emissions and promoting clean energy transformation.
1. The importance of a new round of nationally determined contributions
Nationally Determined Contributions (NDCs) are emission reduction targets and related policy measures proposed by governments based on their own national conditions under the framework of the Paris Agreement. China's new round of nationally determined contributions include not only greenhouse gas emission reduction targets, but also specific actions and adaptation measures to address climate change. By submitting a new round of nationally determined contribution targets, the Chinese government has demonstrated to the world its ambition and positive actions in addressing global climate change.
Specifically, China’s announcement of a new round of independently determined contribution targets has the following important significance:
1. Lead the international community to jointly respond to climate change. The formulation and implementation of nationally determined contribution commitments will help build consensus among the international community and form a global synergy for emission reduction. This will not only help slow down the rate of global climate warming, but also promote the sustainable development of the global economy.
2. Promote the improvement and implementation of domestic dual-carbon policies. In order to achieve the goals set by NDCs, the Chinese government needs to improve and implement relevant laws, regulations and policy systems, strengthen environmental supervision and law enforcement, and promote clean energy to replace traditional energy. The introduction and implementation of these policies and measures will help optimize the industrial structure, improve energy efficiency, and reduce greenhouse gas emission intensity.
3. Further stimulate market vitality and innovation power. In the process of realizing NDCs, the Chinese government will continue to adopt a series of incentive measures, such as financial subsidies, tax incentives, etc., to encourage enterprises and social capital to participate in the research and development and application of clean energy. The introduction of these policies and measures will stimulate market vitality and innovation power, and promote the development and technological progress of related industries.
II. The impact of the new round of nationally determined contribution targets on the petroleum and petrochemical industry
As an important pillar industry of the country, the petroleum and petrochemical industry plays an important strategic role in the national economy and social development. The country’s new round of independently determined contribution targets will have a significant impact on the petroleum and petrochemical industry.
1. Accelerate the adjustment of energy structure. According to the promised goals, the proportion of non-fossil energy in primary energy consumption will gradually increase, reaching about 25% by 2030 and more than 30% by 2035. This means that the proportion of the petroleum and petrochemical industry in energy supply may gradually decline, prompting companies to increase their deployment of new energy businesses. For example, PetroChina plans to account for about 50% of new energy production capacity such as thermoelectric hydrogen and hydrogen by 2050, achieving green and low-carbon transformation and development.
2. Promote the development of low-carbon technologies. In order to achieve the greenhouse gas emission peak target and reduce greenhouse gas emissions per unit of GDP, the petroleum and petrochemical industry needs to increase the research and development and application of low-carbon technologies. Petroleum and petrochemical companies must increase investment in technology research and development and promote the research and application of key technologies such as clean energy substitution and carbon capture and storage (CCS). At the same time, the government will also provide support and guidance in the field of research and development to further stimulate technological innovation, promote technological upgrading and industrial transformation of the petroleum and petrochemical industry, promote the research and development of energy-saving and consumption-reducing technologies, improve energy utilization efficiency, and reduce carbon emissions.
3. Promote the optimization of industrial structure. In order to realize the nationally determined contributions, petroleum and petrochemical companies need to optimize their layout in the upstream and downstream of the industrial chain. This includes increasing investment and construction in new energy projects, developing clean production and circular economy, reducing production costs and improving resource utilization. At the same time, we will strengthen exchanges and cooperation with international partners to jointly address the challenges of global climate change. The introduction of the Nationally Determined Contribution Commitment clarifies China’s strategic direction in carbon emission reduction and green development, and will profoundly affect the investment direction and development strategy of the petroleum and petrochemical industry. The goal of the Nationally Determined Contribution Commitment requires the elimination of backward production capacity. The petroleum and petrochemical industry will accelerate the pace of "reducing oil and increasing chemical production", reduce dependence on traditional fuels, increase the output of chemical products, produce high value-added, low-emission chemical products, such as high-performance synthetic materials, specialty chemicals, etc., optimize the industrial structure, and improve economic and environmental benefits.
4. Intensify the market competition. In the context of the establishment and operation of the global carbon emissions trading system, the petroleum and petrochemical industry will face more stringent carbon emission restrictions and carbon trading costs. This will directly affect the market competitiveness and profitability of enterprises. Therefore, enterprises will pay more attention to market positioning and product structure adjustment, and enhance market competitiveness by providing differentiated, high-quality products and services. According to the commitment, the scope of national carbon market governance has accelerated and will soon be extended to petrochemical and chemical industries. Petroleum and petrochemical companies will face carbon emission quota restrictions. If their emissions exceed the quota, they will need to purchase additional indicators, which will increase production costs. This encourages companies to strengthen carbon emission management and reduce carbon emissions through technological transformation and optimization of production processes to occupy a favorable position in the carbon trading market.
5. Strengthen corporate social responsibility. The Nationally Determined Contributions commitment target reflects China’s determination to address climate change. Petroleum and petrochemical companies, as important entities in the energy industry, need to assume more social responsibilities. Petroleum and petrochemical companies must not only reduce carbon emissions in production and operations, but also pay attention to aspects such as biodiversity protection. For example, PetroChina has established an independent contribution biodiversity protection area and actively participated in afforestation activities to establish a good social image.
6. Strengthen talent training and introduction. Faced with the challenges of technological upgrading and the direction of emission reduction and green development required by the Nationally Determined Contribution Commitment, petroleum and petrochemical companies urgently need to strengthen talent training and introduction. First of all, it is necessary to strengthen the training and education of existing employees to improve their professional skills and environmental awareness; secondly, it is necessary to attract more innovative talents to join and inject new development impetus into the enterprise; finally, it is necessary to focus on cooperation and exchanges with top international scientific research institutions and enterprises to jointly promote the technological progress of the industry.
3. A new round of nationally determined contributions commitment targets to promote the transformation and development of the petroleum and petrochemical industry
As one of the most important energy industries, the petroleum and petrochemical industry provides strong driving force for national economic and social development. However, with the launch of a new round of nationally determined contribution targets, the industry is facing unprecedented challenges: On the one hand, traditional petroleum and petrochemical businesses, such as oil and gas exploration and production and refining and chemical business, are in a critical period of transformation and development; on the other hand, the rapid development of new energy technologies such as solar and wind energy, coupled with the unexpected development of new energy vehicles, is gradually squeezing the market share of oil and gas consumption.
The Nationally Determined Contribution Commitment has pointed out the direction for the development of the petroleum and petrochemical industry and given it a new historical mission. Petroleum and petrochemical companies need to actively respond to the national call, grasp the pulse of the times, and join the wave of green and low-carbon development with a high sense of responsibility and mission. Through technological innovation, industrial integration and international cooperation, we will continue to improve our core competitiveness and make due contributions to achieving global climate governance goals and building a clean, low-carbon, safe and efficient modern energy system. In the future development process, the petroleum and petrochemical industry will adhere to the concept of sustainable development and explore a development path for the petroleum and petrochemical industry that meets the requirements of the times and has Chinese characteristics.
(1) Promote low-carbon industrial transformation
While pursuing economic benefits, the petroleum and petrochemical industry needs to pay more attention to environmental benefits and social responsibility. Actively promote clean energy substitution plans, reduce dependence on traditional fossil fuels, and gradually expand the proportion of clean energy such as natural gas in energy supply. The petroleum and petrochemical industry is one of the major carbon-emitting industries. The new round of independent contribution commitments requires the reduction of greenhouse gas emissions, prompting the industry to accelerate green and low-carbon development. The commitment to emphasize low-carbon development will further optimize the production capacity structure of the petrochemical industry. Regarding petroleum refining capacity, new additions will be strictly controlled in the future, with a focus on supporting the transformation of old equipment. At the same time, the elimination of backward production capacity is intensified. Small refineries with an annual production capacity of less than 2 million tons may be gradually shut down, pushing the industry to develop in a high-quality direction. As the market demand for refined oil products declines, "reducing oil and increasing chemicals" has become a mainstream trend. Companies are converting more crude oil into chemical products, such as special lubricants, high-performance synthetic materials, etc., to meet market demand and increase added value. At the same time, we are actively developing green hydrogen refining, and in accordance with the direction of "hydrogen and electricity integration, green hydrogen and carbon reduction", we are arranging large-scale renewable energy power generation-hydrogen production-hydrogen storage-utilization projects, such as the Ordos scenery-solar integrated green hydrogen demonstration project and the Xinjiang Kuqa green hydrogen demonstration project to help achieve the "double carbon" goal. Adjust product structure and transform to high-end and refined products. Concentrate efforts to conquer a number of high-end chemical materials, such as electronic chemicals that are inseparable from chip manufacturing, key materials needed for new energy batteries, etc., and encourage companies to produce high value-added chemical products. Enterprises need to take energy-saving and carbon-reducing measures. For example, the CNOOC Daxie Petrochemical Project adopts a complete set of process technologies for direct cracking of heavy oil to produce chemicals. Compared with traditional processes, it can reduce energy consumption per unit product by more than 30% and reduce carbon dioxide emissions by 200,000 tons per year.
(2) Improving technological innovation capabilities
The petroleum and petrochemical industry will aim at the high-end direction and promote the deep integration of technological innovation and industrial innovation. In order to realize their independent contribution commitments, petroleum and petrochemical companies need to strengthen technological innovation. On the one hand, we develop and apply low-carbon technologies to reduce carbon emissions in the production process; on the other hand, we use new technologies such as artificial intelligence to empower us to improve production efficiency and management levels. For example, PetroChina uses Huawei's Pangu model as the basis to conduct AI large model research on seismic data volumes to improve exploration and development efficiency. Increase investment in research and development and strive to break through key technical problems such as carbon capture and storage (CCS) and hydrogen energy conversion. Leading the transformation and upgrading of the petroleum and petrochemical industry through technological innovation, providing strong support for achieving carbon emission reduction goals.
(3) Actively expand business development space
Although the traditional energy market share may be squeezed by non-fossil energy, the petroleum and petrochemical industry can actively explore new business areas and market space. For example, chemical manufacturers and downstream users are encouraged to establish long-term and stable cooperation, vigorously explore applications in emerging fields such as new energy and low-altitude economy, tailor new materials for these new tracks, and create new opportunities for industry development. Actively participate in the construction and operation of domestic and foreign carbon trading markets, explore green financial products and services that are in line with its own development, especially strengthen carbon asset management capabilities. Obtain more development opportunities and market share through carbon trading, and achieve a win-win situation of economic and environmental benefits. Petroleum and petrochemical companies have a huge producer service industry. For example, Sinopec has created an "Internet + supply chain" platform "Epac" to effectively connect supply and demand. Enterprises can also accumulate experience by building smart oil fields, smart refineries, etc., and develop into a new productive service industry to provide services to other domestic and foreign enterprises. In addition, the industry is market-oriented, providing technical products and services based on demand, strengthening the coordination of the technological innovation industry chain, promoting the transformation of production-oriented manufacturing to service-oriented manufacturing, and opening up new paths for growth.
(4) Actively promote digital and intelligent transformation
It is foreseeable that in the next few decades, artificial intelligence will become one of the main themes of the world's economic and social development, and also one of the important means to achieve global energy transformation. It will surely become one of the key areas of long-term attention and investment in the world. Moreover, artificial intelligence will be highly integrated with major industries, including the petroleum and petrochemical industry. Artificial intelligence + petroleum and petrochemical industry will definitely be one of the core directions for long-term development in the future. Therefore, the petroleum and petrochemical industry will definitely use big data, artificial intelligence, Internet of Things and other technologies to comprehensively and systematically upgrade the production process, thereby continuously improving the accuracy of oil and gas exploration and development activities and the efficiency of production and operation of petroleum and petrochemical industry enterprises, while providing technical support for production and operational decisions. For example, Lanzhou Petrochemical took the lead in launching a digital transformation pilot for refining and chemical enterprises. Through the Kunlun MES system and a large-scale centralized ERP system, it achieved daily balance of production and operation data and integrated management and control of business and finance. The digital coverage of the main business exceeded 80%, the financial analysis efficiency jumped by 90%, and business decision-making entered the minute-level era.
(The author is affiliated to the China International Carbon Neutral Economic Research Institute, w88 casino)
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