The Work Package 2 touches the impacts of power sector on water and environment. A profound analysis on thermoelectric generation reflects its destructive force to water security, climate, environment and public health, particularly in one or two pilot provinces relying on power industry for local GDP. The recommendation to the key governments, i.e. the Ministry of Water Resources (MWR), the National Development and Reform Commission (NDRC), the National Energy Administration (NEA), Shanxi or Hebei Provincial Government, State Administration of Taxation, has both legal and fiscal procedures steering at those challenges.
The China’s 13th Five-Year Plan from 2016 through 2020 proposes the main targets and one of which is to encourage green ways for conservancy of water, ecosystem and the environment to cut water consumption, energy consumption, and carbon dioxide emissions per unit of GDP by 23%, 15%, and 18%, respectively’. The rapid growth of China drives development of power industry. The power generation, esp. thermoelectric power is fatal to water security, eco or environment. Some policymakers and power companies without rich knowledge can hardly comprehend the negative impact of thermoelectric power on water security (surface, groundwater & aquifer), climate and ecosystem, let alone apply law or fiscal policy tools to resist destructive force of the power industry.
China, in 2017, expects to reduce emissions from the burning of coal, promote cleaner and more efficient use of coal, and upgrades coal-burning power plants nationwide to achieve ultra-low emissions and energy efficiency. In addition, the State Administration of Taxation, with MOF and MWR, issued “Taxation Rules of Water Fees in Pilot Province” to apply tax tool as the leverage between water and power. Based upon an overall survey on water use in the Chinese power sector and its influence on global climate and water security, it will select one/two case(s), e.g. Shanxi, Hebei, relied on power industry (esp. thermoelectric) for local GDP and evaluate the pros and cons of existing policies regarding water consumption, discharge and emission of the power generation and water fees of the sector. Along with the risk analysis of thermoelectric power in local water security and environment, it has a workout with viewpoints and recommendations of legislative and fiscal tools, e.g. price instrument, a matter of cost and benefit of power industry. The policy proposal targeting at MWR, NDRC, NEA & local governments will state analysis result and optional policies or regulation measures appropriate.
 Source from the “Report on the 2017 Work of China’s Government” issued in January, 2017