Energy policy to fuel economic objectives

Although the 12th Five-Year Plan technically concludes in 2015, it is more apt to view the plan as the opening salvo to a pivotal decade intended to shepherd China toward a sustainable, innovative, and integrated continental economy. Indeed, the new plan is a sober recognition that pursuit of China's current export and investment-led growth model is facing diminishing returns.

Sustaining growth, in the face of a realignment in global consumption and demand patterns, will require a different emphasis on qualitative growth and domestic consumption. A lower 7 percent growth target and language that trumpets economic development over growth indicate that Chinese policymakers realize this.

China's economic model propels its energy consumption, which concentrated among heavy industry and manufacturing fuels an export juggernaut. In other words, China's energy problems are a direct result of being an industrial "producer", which is the opposite of the United States, which is a consumer-led energy guzzler. Viewed this way, it becomes obvious that the energy pattern in each country reflects a major symptom of the central economic imbalance of production and consumption between China and the US.