Energy strategy has become a growing focus both within and outside the industry. Recently, a book launch and the China Energy Strategy Seminar were held at the Yuanwanglou Hotel in Beijing. These events highlighted the increasing importance of energy planning in the context of global changes.
One of the key publications released during the event was "Five Fingers Boxing: China’s Energy Strategy in Response to New Changes in the World," commonly referred to as the "Five-Finger Strategy." This work presents a fresh and innovative approach to China’s energy policy, proposing a comprehensive strategy that includes energy saving, green development, structural adjustment, security, and reform before 2030.
The current energy landscape is marked by significant challenges. According to the study, there are five major new characteristics in the energy situation: increased volatility in international energy markets, rising pressures on energy use and trade, bottlenecks in resource supply and environmental capacity, contradictions in the energy management system, and emerging breakthroughs in energy technologies and production methods.
In recent years, Chinese authorities have placed greater emphasis on energy strategy research. The 2007 White Paper on China’s Energy Status and Policy outlined the core elements of China’s energy strategy, emphasizing energy conservation, domestic development, diversification, technological innovation, environmental protection, and international cooperation. It aimed to build a stable, efficient, clean, and safe energy supply system.
The "China Energy Policy (2012)" reinforced similar principles, including prioritizing energy conservation, promoting diversified development, protecting the environment, advancing scientific and technological innovation, deepening reforms, strengthening international cooperation, and improving people’s livelihoods.
Li Xiaoxi, a renowned economist and co-leader of the Five-Finger Strategy project, pointed out that the previous white papers did not fully address the evolving energy challenges. He emphasized the need for more specific and comprehensive strategies.
To tackle these new challenges, the Five-Finger Strategy integrates energy-saving measures, green development, structural adjustments, energy security, and institutional reform. Among these, the reform strategy serves as the foundation, aiming to establish an efficient energy operation mechanism through improvements in the energy management system.
According to Li Xiaoxi, the five sub-strategies must be coordinated to form a unified and effective energy strategy. He stressed that while reform may appear as the final component, it is actually the most critical one, as it underpins the successful implementation of all other strategies.
Wang Zhen, executive deputy director of the China University of Petroleum Energy Strategy Research Institute, even suggested that reform should take the leading role in the Five-Finger Strategy.
Despite over three decades of reform, China’s energy system still faces issues such as incomplete separation between government and enterprises, an irrational market structure, imperfect pricing mechanisms, weak industry management, and insufficient scientific governance. These challenges require systemic solutions.
The study advocates for top-level design in the process of energy marketization, emphasizing the need for a unified vision, clear direction, rationalized government functions, and better integration of market and government roles. It also calls for further separation of government and enterprises, reduction of policy burdens on state-owned enterprises, nurturing qualified market participants, and improving the energy management system to address market failures and achieve broader economic and social goals.
A key area for reform is the power sector. Lin Weibin, deputy director of the Five-Finger Strategy project, proposed that electricity reform should serve as the breakthrough point, driving the marketization of coal and electricity. He recommended accelerating direct electricity purchases by large users, building a competitive market, reforming the electricity pricing mechanism, enhancing regulatory systems, and deepening power company reforms to cultivate a more dynamic and transparent energy market.
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