china-air-pollutionChina has announced that it will not set carbon emissions reduction targets for itself at the United Nation’s climate change conference in Copenhagen in December. Its government has also been vocally opposed to U.S. legislation pending in the House that would establish “carbon tariffs” — regulations that would put an import tax on any goods from countries that do not have emissions reduction quotas in place.

If carbon tariffs are approved, China would be hampered in its ability to sell cheap steel, damaging its ambitious plans to sell cars in the U.S. Zhang Haibin, an adviser to China’s Ministry of Commerce, warned that if the bill passes with carbon tariffs intact, “China would be very frustrated and angry,” which is hardly the mood the U.S. wants to meet them in in Denmark.

Without setting lower emissions targets, China has the freedom to produce as much cheap steel as it wants, and to sell it to whomever wants it. The U.S. carbon tariff would make it expensive for them to maintain these lax standards. They would lose revenue and prices would become less competitive.

That’s something China can’t afford to do right now, as it’s seemingly wedged itself between a rock and a hard place. On one hand, it is the No. 1 polluter, No. 1 concrete pourer (with much of it going into the Yahtze river) and No. 1 land-mover in the world. On the other, it the largest country on the planet that has pledged to reduce carbon dioxide emissions, invest in green power, and plant enough trees to cover an area equivalent to that of Norway.

“At stake in the fight against climate change are the common interests of the entire world,” Chinese president Hu Jintao said. “Out of a sense of responsibility to its own people and people across the world, China fully appreciates the importance and urgency of addressing climate change.” China says that there is to be a “notable” decrease in the country’s carbon emissions by the year 2020 (from 2005 base levels). “Notable” has yet to be defined, though the government also says it will generate 15 percent of its electricity from renewable sources by 2020.

In the run up to December’s climate talks, the question is: Which way will China go? Will it operate independently and keep decisions in-house? Or will president Hu live up to the country’s “sense of responsibility” and play nice in Copenhagen? We probably won’t know until we get there.

greenbeat_logo73VentureBeat is hosting GreenBeat, the seminal executive conference on the Smart Grid, on Nov. 18-19, featuring keynotes from Nobel Prize winner Al Gore and Kleiner Perkins’ John Doerr. Get your early-bird tickets for $625 before Oct. 31 at