China Cabinet to get Energy Law Draft by Early 2008

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BEIJING - A draft energy law that may lay the groundwork for an energy ministry will be submitted to China's cabinet by late this year or early 2008, an official presentation showed, as Beijing seeks to bolster efficiency and control.  China, the world's number two energy consumer, has made resource efficiency and security top priorities because of concerns about a growing reliance on foreign oil and massive pollution problems.

BEIJING (Reuters) - A draft energy law that may lay the groundwork for an energy ministry will be submitted to China's cabinet by late this year or early 2008, an official presentation showed, as Beijing seeks to bolster efficiency and control.

China, the world's number two energy consumer, has made resource efficiency and security top priorities because of concerns about a growing reliance on foreign oil and massive pollution problems.

Discussion by the State Council, or cabinet, would be only the first in a series of revisions, but the tight timetable suggests Beijing may hope to have the law ready for the brief annual session of its parliament in early spring, analysts said.

A preliminary version has already been circulated to a group of industry insiders, an official involved in the drafting said.

"We have printed 200 copies and sent them to people around the country," he told Reuters on Thursday.

Their suggestions will be worked into the new draft, which could reach top decision makers in just a couple of months.

"Public opinions will be solicited again before it is submitted to the State Council by the end of this year or at the beginning of next year," an energy official said in remarks prepared for an international conference and seen by Reuters.

Cabinet approval is just the first step in a complicated road. The State Council law office feeds comments from ministries into a new draft sent to the Law Committee of China's parliament, the National People's Congress, a Chinese legal expert said.

That committee also talks to ministers and interest groups and has the right to make repeated revisions. For some laws, like a controversial one on property rights which endured a record seven readings, the process can drag on for years.

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The law can be passed by parliament's standing committee, but if Beijing wants it heard by a full session it must either race to be done by early 2008 -- parliament usually meets in March -- or wait another full year to legislate on the hot topic.

"There might still be technical issues to be worked out but on such important policy issues, political will often prevails. If they want to do it, they will do it," said Wenran Jiang, an expert in Chinese energy at the University of Alberta.

"It will look like too much delay if this is considered in 2009. People would raise questions about the commitment and the ability of the central government in moving forward the energy/ environment/sustainability agenda," he added.

Earlier this month sources told Reuters that the current draft calls for new energy administrator, which could be called a ministry or commission, and a sector watchdog. The law is also likely to cover foreign investment and strategic reserves.

China dismantled a previous energy ministry in 1993, and brought energy affairs under the control of the National Development and Reform Commission (NDRC), an economic planning super-ministry.

International experts warned that the complicated negotiations needed to hive off such a key policy area from the NDRC would make a 2008 vote on the bill a tight squeeze.

"It sounds like that is what they want, but its a very compressed schedule -- I suppose if people at the top are really banging heads together it might happen," said one who works with the Chinese government but declined to be named.