On July 29th, the China Energy Model Forum (CEMF) held its fifth salon on the theme of "Building a Sustainable Future: Low-Carbon Economy Supporting Inclusive Growth." During this salon, the latest progress in research related to low-carbon economy and inclusive growth was shared, and discussions were held on how a low-carbon economy can provide more opportunities for inclusive growth. The salon was hosted by Professor Liu Yu from the College of Urban and Environmental Sciences at Peking University. The dialogue included Vice Director and Researcher Chen Ying from the Sustainable Development Research Center of the Chinese Academy of Social Sciences, Professor Zheng Siqi, a lifelong professor in the Department of Urban Studies and Planning at the Massachusetts Institute of Technology and Director of the Real Estate Research Center, and Professor Pang Jun, Dean of the School of Environment at Renmin University of China. CEMF has summarized the viewpoints of these experts to share with readers.

Group photo of experts

Is there a synergistic relationship between China's carbon neutrality goals and inclusive growth?

Professor Pang Jun, Dean of the School of Environment at Renmin University of China, pointed out that the core meaning of inclusive growth is to achieve a balance while pursuing economic growth, emphasizing fairness and justice. Carbon neutrality goals, as a crucial lever for achieving sustainable economic and social development and high-quality growth, not only promote high-quality economic growth but also drive the low-carbon transformation of energy structures and production methods, advancing the transition from an industrial civilization to a higher-level ecological civilization. In this process, the opportunities generated by carbon neutrality can generate income and increase employment opportunities in economically disadvantaged regions, benefiting different groups and improving the quality of life and health of residents. He emphasized that carbon neutrality goals encompass an important aspect of inclusive growth. There is a synergistic relationship between the two.

Pang Jun

Professor and Doctoral Supervisor, Dean, School of Environment, Renmin University of China

How to understand the relationship between climate change response and sustainable development?

Chen Ying, Deputy Director of the Sustainable Development Research Center of the Institute of Ecological Civilization of the Chinese Academy of Social Sciences, answered the question from the perspectives of climate change response and sustainable development respectively. She said, on the one hand, the threats and challenges posed by climate change to human society are becoming increasingly severe, and the impacts are extensive and profound, so responding to climate change to a certain extent maintains the sustainable development of human society; on the other hand, policies related to sustainable development are usually conducive to responding to climate change, and there exists a bidirectional interactive relationship between the two. Therefore, in order to fundamentally change the unsustainable mode of production and life, it is necessary to look at climate change response and green low-carbon development transition from a broad perspective of sustainable development.

Chen Ying

Researcher at the Institute of Ecological Civilization, Chinese Academy of Social Sciences.

Deputy Director, Research Center for Sustainable Development, Chinese Academy of Social Sciences

How is the ESG performance of real estate companies? As ESG gradually gains recognition from capital markets, governments, and even the public, how will it impact the future real estate market? Apart from market supply and demand factors, are there any other factors that can drive ESG performance?

Zheng Siqi, a lifelong professor in the Department of Urban Studies and Planning at the Massachusetts Institute of Technology and Director of the Real Estate Research Center, expressed concerns about the current ESG levels of real estate companies. He pointed out that the carbon emissions and energy consumption associated with the built environment (mainly buildings and infrastructure) account for 30%-40% of the total societal emissions, and in some major cities, this figure can go as high as 70%. Under carbon neutrality goals, government action is urgently needed to regulate the construction industry and achieve energy efficiency and emissions reduction.

He also emphasized that the real estate market is gradually shifting from an incremental market to a stock market. In the short term, the real estate market will face challenges, which is why sustainability should be emphasized. It is crucial to pursue a path of sustainable development, utilizing both policy intervention and the capital market as two important external forces to drive ESG performance.

Zheng Siqi

Professor in the Department of Urban Studies and Planning at the Massachusetts Institute of Technology (MIT)

Director of the Real Estate Research Center

Academic Committee Member of CIDEG

Inclusive growth encompasses multiple aspects. What are the potential pathways to achieve it?

 Chen Ying, Vice Director of the Sustainable Development Research Center at the Institute of Ecological Civilization, Chinese Academy of Social Sciences, highlighted several key points. First, achieving inclusive growth requires a shift in development philosophy, incorporating social equity into the development mindset, considering the societal need for shared prosperity rather than solely pursuing GDP growth. Second, it's essential to define development strategies and transform growth patterns through policy adjustments on multiple fronts. This could involve providing compensation measures or training opportunities for industries, communities, or populations significantly impacted during the transition, thus realizing inclusive growth.

What are the issues to be considered in the collaborative process between low-carbon economy and inclusive growth? Professor Pang Jun, Dean of the School of Environment at Renmin University of China, raised four important issues that need attention. First, achieving peak carbon emissions and carbon neutrality should be approached cautiously, with policies established on a solid foundation before gradually phasing out high-carbon industries. Second, different provinces should avoid one-size-fits-all approaches in the collaborative process and leverage their industrial advantages while steering clear of high-carbon polluting industries. Third, income fairness should be achieved through various regulatory measures, and the development of new energy sources should create new job opportunities for low-income individuals. Lastly, it's crucial to consistently work towards building a community with a shared future for humanity, uphold free trade, and protect the interests of low-income countries and populations to achieve the synergy between inclusive growth and a low-carbon economy.

Chen Ying, from the Institute of Ecological Civilization, shared her perspective on Professor Pang's points. She emphasized the need to avoid swinging to the opposite extreme during the implementation of gradual phase-outs and to use policies to facilitate a smooth transition. On one hand, it's important to motivate companies from the production side, and on the other hand, reforms should be made to existing policies through education, and even economic incentives, to generate consumer demand and create a collective societal effort, thereby better promoting sustainable development goals.

Zheng Siqi, a lifelong professor in the Department of Urban Studies and Planning at the Massachusetts Institute of Technology and Director of the Real Estate Research Center, emphasized the importance of micro-level coordination in addition to macro-level policies. He highlighted the need to incentivize various micro-level entities to go further on the low-carbon path. He mentioned that uncertainty is inherent in the future, and policy decisions may introduce biases leading to subsequent problems. Therefore, it's essential to acknowledge and accept this uncertainty, incorporate it into energy models for analysis, and provide support for policymakers to enable more precise policy and market mechanism design.