This piece was co-written with William Miao. It originally appeared on ChinaFAQs.

Amidst headlines detailing off-the-charts air pollution in Beijing, it may come as a surprise that China’s latest environmental scorecard does boast bright spots. The 2014 Yale Environmental Performance Index (EPI) – a biennial global ranking of how well countries perform on a range of critical environmental issues – ranks China at 118 out of 178 countries. With respect to other emerging economies with rapid growth and development, China does not fare as well overall as Brazil (77th), Russia (73rd), or South Africa (72th), but is considerably ahead of India, which ranked 155th. However, China is a leader in addressing climate change and is taking corrective action to address weaknesses.

Where does China lead and lag, and what might explain these trends in environmental performance? We unpack some of the key trends for China on the issues the EPI tracks, specifically air quality, and climate and energy.

China leading on climate and energy

Although the world’s largest emitter of greenhouse gases, China is emerging as a leader in tackling climate and energy issues. Their standing at 21st out of 121 countries, while Germany stands at 31st and the United States at 49th, is a testament to the actions the Chinese government has taken over the last decade to reduce the energy intensity of their economy.

The EPI’s climate and energy rankings gauge developed and major emerging economies according to their performance on two types of indicators. Developed countries are assessed according to how well they reduced carbon intensity over the last decade (2000 to 2010); while major emerging economies are evaluated in terms of the change in the growth rate of carbon-intensity between 2000-2005 and 2006-2010. This latter goal allows for emerging economies like China to grow their economies over time but to slow the rate at which carbon intensity increases. (Least-developed countries were not included in the climate and energy rankings).

‘Top-level’ leadership and commitment

With an energy intensity reduction target and policies in place since the 11th Five-Year Plan (2006-2010) and a carbon intensity target since 2009, China performed better than all other emerging economies (Brazil, India, Russia, and South Africa) in reducing its rate of carbon intensity growth.

The goal set by the government was to reduce energy intensity 20 percent by 2010 from 2005 levels, and the government’s programs and policies to reach this goal are well documented. These efforts include the closure of small, inefficient industrial and manufacturing facilities; a program aimed to improve efficiency at the Top 1,000 energy-consuming enterprises; and standards for energy efficiency aimed at buildings and appliances.

Figure 1. Change in Carbon Intensity Growth for major emerging economies between 2000-2005 and 2006-2010. (Source: YCELP and IEA, 2013)

Figure 1. Change in Carbon Intensity Growth for major emerging economies between 2000-2005 and 2006-2010. (Source: YCELP and IEA, 2013)

After initial reductions in energy intensity in the 11th Five-Year Plan, the government has continued to focus heavily on climate change and energy issues. The State Council adopted China’s Copenhagen commitment to reduce carbon intensity 40 to 45 percent from 2005 levels by 2020, including a 16-17 percent reduction in the 12th Five-Year Plan (2010-2015). The inclusion of this target into the 12th Five-Year Plan had the effect of binding provinces to achieve this goal, and evidence suggests that most provinces are making progress towards meeting their goals next year. To further its low carbon policies China also launched seven carbon emissions trading pilots last year and a feed-in tariff to encourage domestic uptake of solar-generated electricity. Statistics show China in 2009 surpassed the United States in installed wind capacity. Last year, China had 75 GW of wind installed compared to the United States’ 61 GW, although the U.S. still boasts more wind-energy generation. These efforts demonstrate the Chinese government’s concern for energy security, the impacts of climate change, and its recognition of its global position as a top energy-consuming country.

China’s progress on carbon intensity has not been paralleled when it comes to air quality. China saw the world’s worst performance for average exposure to fine particulate matter (PM2.5). In fact, the EPI shows China’s air quality worsening from 2000 to around 2007, at which point there is a small decrease followed by an increase back to previous levels.

However, comprehensive air pollution policies and targets have only recently become the focus of the top-leadership. The persistent media attention paid to staggering levels of air pollution in major Chinese cities like Beijing and Shanghai has pushed the government to ramp up efforts to tackle it. Since Jan. 1 2014, 15,000 of the largest State-Owned Enterprises (SOEs) are required to release real-time data on air and water pollution. SOEs historically have been some of the least transparent and often greatest pollution offenders. This compulsory disclosure follows the announcement of “air pollution control and responsibility” contracts to hold provincial leaders responsible for meeting strict reduction targets, as well as a $277 billion dollar air pollution control plan released last July, which prohibits new coal-fired power plants in some areas. The near real-time response with which the government has responded to hazardous air pollution events with vigilant monitoring, an $81 million USD smog lab, harsher penalties for smog offenders, and previous action on sulfur dioxide is impressive. Hopefully, these efforts will result in tangible, measurable reductions in air pollution for the millions of citizens living in China who are starting to demand better air quality, some even going so far as to sue local governments for it.

China’s divergent performance on these two issues suggests differences in policy commitment paid over the last decade, but also the complexity of the air issue.

Ultimately, China’s performance on the 2014 EPI may not come as a surprise to its decision makers, who have demonstrated and continue to demonstrate considerable attention and commitment to addressing environmental challenges over the last decade. What is important to recognize are the gains China has achieved, particularly on climate and energy, and that efforts are being made to address areas of weakness.