HK on Greenhouse Gases: All hot air

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Jaw jaw on reducing carbon emissions rules over action as Hong Kong gets a free ride on China’s developing country status.


It is now 23:57. The last time the Doomsday Clock showed this perilous time was during the Cold War era. Now, it is global warming that has driven the Clock towards an apocalyptic midnight. 2014 was the hottest year ever measured. While this may be good news for surfers and beach lovers, scientists and environmentalists feel cold sweat running down their backs.

Thinking of the world’s most ‘generous’ greenhouse gas contributors, the US, China, the EU and India come to mind. They collectively account for over 60% of the global carbon emissions. It is a known fact that China tops the world in total emissions but when it comes to emissions per capita, US’s figure (16.5 tonnes of carbon dioxide) is more than double than China’s 7.2 tonnes.

Here in Hong Kong, many people do not think the city’s emissions would be on par with the above big players but there is an inconvenient truth: Hong Kong’s emissions per capita on production basis is “around 6 tonnes but on consumption basis this rises to nearly 15 tonnes – close to the top among world cities,” says Albert Lai, CEO of Carbon Care Asia and Policy Committee Convenor of Professional Commons.


Christine Loh: Eyes on China’s moves

At the Lima Climate Change Conference last December, countries declared their Intended Nationally Determined Contributions (INDCs) – voluntary commitments and actions addressing post-2020 carbon reductions – which will be signed at the next talks in Paris this fall.

China will release its INDCs in the first half of this year and it is anticipated to include the terms that were promised during US President Barack Obama’s visit to China last November. Those terms will see China to peak its carbon dioxide emissions, and increase the share of non-fossil fuels in primary energy consumption to around 20% by 2030.

As the world largest greenhouse gas contributor, China’s moves will inextricably draw global attention. In Hong Kong, Under Secretary for the Environment Christine Loh reiterated the importance for the city to take heed of China’s new green policies to fight global warming. At a seminar organised by the Business Environment Council and Civic Exchange early this week, an environmental think tank she founded, Ms Loh says China is reforming the banking system and financial sector, and improving the energy efficiency in buildings to support the green transition of the nation.

“The question for Hong Kong is what our role should be? What is it that the private sector can do more in this bigger picture? What might Hong Kong be able to do? Because one of the most exciting things to go forward in many years to come is the transition of China.”


“In Hong Kong, I don’t think we have the expertise in emissions trading. We have a lot of expertise in trading other things but not emissions trading”
– Christine Loh


Carbon trading, NO!

The Hong Kong Government has already targeted a carbon intensity reduction of between 50-60% by 2020, using 2005 emissions as a base line. A public consultation will soon be carried out on the new Scheme of Control Agreement and the consultation report on future fuel mix for electricity generation will also be released shortly.

Furthermore, Ms Loh revealed there will soon be consultation on policies that are intended to tackle climate change. In it, she says the focus will be on building efficiency, adaptation policies, support to strengthen green financial services and more but she has not given further details. However, it is certain that carbon trading will not be brought up.

In 2010 HKEx concluded after conducting a consultation that “there is no imminent need for a Certified Emission Reduction futures market in Hong Kong.” 5 years after the decision, no one in the Hong Kong polity is challenging that decision.

“I think it was probably the right decision,” says Ms Loh who told the audience at the seminar that she has looked into carbon trading for 20 years and backed the HKEx’s conclusion.

“In Hong Kong, I don’t think we have the expertise in emissions trading. We have a lot of expertise in trading other things but not emissions trading,” she was candid in pointing out the shortcomings of Hong Kong.

She believes China will expand the current emissions trading scheme and Hong Kong can play a role to support such a move without establishing its own emissions trading market. “Looking at where we are today, what is it that Hong Kong may be able to offer to mainland on emissions trading?”

She provided hints to her own questions when she came out in strong support after Alexandra Tracy, President of Hoi Ping Ventures, talked about the potential of Hong Kong to draw funds for green businesses. Ms Loh has implied the Government will explore ways for Hong Kong to be the hub of green financing and openly suggested the financial sector to talk to Laura Cha, Chairman of the Financial Services Development Council and also an ExCo member.

There will be more details soon but already the Government has found itself an ally in the pan-democratic camp in LegCo. Kenneth Leung, lawmaker of the accountancy sector and Vice President of Professional Commons, has told Harbour Times that one of his priorities this year is to advocate for green financing and banking.

In a research report that will be published by Mr Leung shortly, a number of policies will be listed, such as tax incentives for green tech companies registered in Hong Kong, mandatory Environmental, Social and Governance reporting (requiring listed companies to disclose their emissions performance), rebates for buildings that meet energy-efficiency rating and more.


“While we claim Hong Kong is sophisticated and developed, Hong Kong is part of a developing nation, which means Hong Kong technically has no obligation to cut emissions”
– Albert Lai


Caught in the middle

Hong Kong is placed at an awkward position in the fight against global warming, Carbon Care Asia’s Albert Lai noted. The well known Kyoto Protocol was built on a basis that developed and developing countries have ‘common but differentiated responsibilities’, meaning developed countries, which are considered as culprits of the global warming crisis, have obligations to reduce current emissions but developing countries are left to a voluntary cut.

“While we claim Hong Kong is sophisticated and developed, Hong Kong is part of a developing nation, which means Hong Kong technically has no obligation to cut emissions,” Mr Lai says.

It was in this context that Carbon Care Asia was founded to push for voluntary reduction targets in both the public and private sectors. The group is the first in Asia to hold a Climate Strategist Corporate Leader Workshop. In the workshop, representatives from airline companies, power companies, construction companies and other sectors took on roles as the head of state for various countries and participated in a game where the aim is to cut global carbon emissions. The game required participants to make the appropriate decisions on national policies in order to keep the economy growing without creating environmental hazards. Diplomacy was also an important factor to win the game.

Founded in 2008, Carbon Care Asia has made strides in shaping a greener Hong Kong. It was commissioned by the Environmental Protection Department to build the online Carbon Footprint Repository (CFR) which enables listed companies in Hong Kong to disclose their carbon footprints and share successful stories on carbon management and practices. More than 60 listed companies have disclosed their emissions performance through the CFR since it launched last December.

With 3 minutes left until midnight, the doomsday clock does not leave us much room to hesitate. China’s new commitments to counter global warming will be made public soon but already, the nation has started phasing out the use of dirty coals. The big smog in Beijing last year has also forced the Central Government to be more serious in the nation’s green transition. Here in Hong Kong, just like in the question raised by Ms Loh, we have to search for our role to play in helping China become greener.