2018 State Of Ecology & Environment Report Review

By China Water Risk 18 June, 2019

One year on from the MEE reform, we find mixed trends for water in China

Groundwater & shallow groundwater quality has worsened drastically; this may be rather reflecting the true state of groundwater as monitoring stations have up 2x from 5,100 to 10,168 stations
Good news on other fronts: national surface water quality continues to improve across all categories; Key Lakes & Reservoirs water quality finally back on track since its decline in 2015
Overall quality of main river basins improved but 5 major Northern rivers still below 70% target of Grade I-III water quality set by the Water Ten plan; Pearl, Songhua & Liao quality all worsened

On 29 May 2019, the Ministry of Ecology and Environment (MEE) released the 2018 State of Ecology and Environment Report (SOEE). This is the first SOEE report that looks at China’s environmental status since the implementation of the new Water Ten Law in January 2018, and the announcement of the MEE reform in March same year.

The report cites 2018 as “an important milestone for China’s ecological and environmental protection journey”, as many pollution focused policies were released over the last year. Some key points of the report are:

  • Central government upped funding of environmental protection and pollution control to RMB255.5bn, which is 5x compared to the RMB49.7bn in 2017;
  • China has delineated ecological protection “red lines” for 15 provinces/municipalities including: a) “Jing-Jin-Ji” provinces (Beijing-Tianjin-Hebei); b) Yangtze River Economic Belt (Jiangsu, Zhejiang, Anhui, Jiangxi, Hubei, Hunan, Guizhou, Yunnan, Sichuan, Shanghai and Chongqing); and Ningxia;
  • The rectification rate of problems in 1,586 water resource bodies has reached 99.9%;
  • 1,009 out of 1,062 black and smelly water bodies in 36 major cities have been fixed; and
  • 8% of provincial-level (or larger) industrial parks have built centralised wastewater treatment facilities and automatic monitoring devices.
Polluters have nowhere to hide…

  • A total of RMB15.3bn in environmental violation fines were handed out in 2018, an increase of 32% compared to 2017; according to the MEE, this was a 4.8x increase over 2014 before the revised Environment Protection Law was in effect;
  • However, the total administrative penalties against violations have dropped this year from 233,000 to 186,000, indicating average fines are getting heftier; and
  • More than 8,000 environmental crimes were detected and solved.
– 2018 State of Ecology and Environment Report

As for water quality, the report shows some significant improvement in several water-related aspects but also emphasised that much efforts still needed to win the “war on pollution”:

  • Groundwater worsened drastically… or has it?: both groundwater and shallow groundwater quality have dropped significantly: with the proportion of groundwater stations with “good” and “excellent” quality plunging almost 3x compared to last year; whereas the proportion of shallow groundwater stations with “very bad” quality surged >3x. But the fall in quality may not actually reflect worsening in groundwater quality but rather a truer reflection of the real state of groundwater – more on this below.
  • National surface water continues to improve across all categories: the improvement in surface water also reflected in following aspects:
    • Key Lakes & Reservoirs – finally shows improvement across all categories since the decline in 2016
    • Main Rivers – overall surface quality of China Main River Basins meeting Grade I-III rose to 74.3%, meeting the Water Ten target of 70%, but 5 Northern rivers still fail to meet the target

With the overview findings from the report mentioned above, we dive deeper into the 2018 SOEE report below starting with the notably different groundwater quality.

Overall groundwater quality plunges… finally the true state of groundwater?

China’s groundwater quality has been gradually deteriorating for the past several years (except for a blip in 2016). This year, however, things fell off the cliff. The proportion of groundwater stations with “good” and “excellent” quality fell drastically from 31.9% to 10.9%; while the proportion of groundwater stations with “bad” and “very bad” quality rose from 66.8% to 86.2%. This year, the proportion of “very bad” groundwater quality of 15.5% fails to meet the Water Ten Plan’s target of 15% by 2020.

But has groundwater quality really fallen that much? Or were we correct in saying in our SOEE review last year that we are finally seeing the true state of groundwater because of better coverage? After all, in the past year, there was an unprecedented rise in the number of groundwater monitoring stations, doubling from 5,100 to 10,168. In contrast, the number of surface water monitoring stations fell slightly from 1,940 to 1,935.

Or is the 2018 ministerial reform the root cause in the worsening numbers as well as the doubling of monitoring efforts?

It is worth remembering here that groundwater pollution control used to come under the Ministry of Land & Resources (MLR) which is now defunct. Post reform, surface and groundwater will be managed under one umbrella – the MEE. This was one of the five key unsilo-ing breakthroughs we mentioned in our review of the reforms.

The Minister of Soil Management and Groundwater Control from the MEE Minglu Li had this to say: “the monitoring of groundwater functions was dispersed across various ministries… now under the ministry reform, the MEE is fully in charge of monitoring the nation’s ecological environment and responsible for supervising and preventing groundwater pollution.”

In merging overlapping responsibilities & monitoring efforts of ministries a better picture of China’s groundwater woes is formed

In merging the various overlapping responsibilities and monitoring efforts of ministries a better picture of China’s groundwater woes is formed. Looking forward, with the ministry reform still in progress, do not be surprised to see more fluctuations in groundwater quality data like what we have seen. Hopefully, by the time the ministry restructuring is complete, we will finally see a comprehensive real state of water in China.

Regardless, groundwater continues to be a key front in the war on pollution so looking forward, we hope that the newly established “Soil Pollution Prevention & Control Law”, and the revised “Water Pollution Prevention and Control Law” will strengthen government responsibility and supervision to protect the groundwater.

China will establish a legal system & monitoring mechanism for groundwater pollution control by 2025

The good news is according to Minglu Li, the MEE will also establish a system for standards and rules related to the protection and treatment of groundwater pollution and a national monitoring mechanism by 2025. A detailed plan will be released before the end of 2020 to outline key tasks and steps for groundwater pollution protection and treatment for the 2021-2025 period.

Shallow groundwater of China’s river basins – overall quality deteriorated

Similar to the overall groundwater, the shallow groundwater quality of China’s main river basins has worsened significantly, especially the proportion of “very bad” quality has increased >3x from 14.6% in 2017 to 46.9% in 2018. The proportion of “good or excellent” quality has slightly decreased to 23.9%. Again, this may not be a true worsening but simply a truer reflection of the state of shallow groundwater.

For shallow groundwater: “very bad” increased >3x from 14.6% in 2017 to 46.9% in 2018…

… “good or excellent” slightly decreased to 23.9%

It is noteworthy that the shallow groundwater quality of individual river basins has not been disclosed this year with no given explanation. Perhaps, they are still trying to merge data across the ministries.

National surface water quality continues to improve gradually

Despite the negative trends in groundwater and shallow groundwater, there is an overall improvement in the national surface water quality.

Grade I-III rises from 68% in 2017 to 71% in 2018 and Grade V+ drops from 8% to 7%.

For national surface water: grade I-III rises from 68% in 2017 to 71% in 2018…

…Grade V+ drops from 8% to 7%


Key Lakes & Reservoirs – overall quality is back on track across all categories

Water quality of Key Lakes & Reservoirs has finally improved since its decline in 2015. The share of Key Lakes & Reservoirs with Grade I-III improved from 63% in 2017 to 67% in 2018. The proportion of water bodies that are “unfit for human contact” (Grade IV-V+) also improved from 11% to 8%.

Main River Basins quality – improving but 5 Northern rivers continue to struggle to meet Water Ten target

The overall quality of China’s Main River Basins has gradually improved from 2016 to 2018. Grade I-III water improved from 71.8% to 74.3%; Grade IV-V slightly improved from 19.8% to 18.9%; and Grade V+ improved from 8.4% to 6.9%.

Similar to previous years, Southern rivers (Yangtze and Pearl) are doing relatively well and Northern rivers continue to struggle in reaching the Water Ten target of 70% surface water meeting Grade III or better by 2020. Most likely the Yellow River will be the first Northern river to meet the Water Ten target of 70% in Grade I-III. The other four still have a long way to go to meet this target by next year.

Only Yangtze meets both “70% (Grade I-III)” & “<5% (Grade V+)” targets set by Water Ten

By 2020, the Grade V+ surface water quality of the main river basins must also be controlled fewer than 5%. At present, only Yangtze and Huai rivers have met this target (Pearl almost meets the target, currently at 5.5%). Yangtze is the only river that meets both “70% (Grade I-III)” and “<5% (Grade V+)” targets.

Breakdown of 7 major river basins – overall surface quality improved slightly but Pearl, Songhua & Liao deteriorated

Yangtze and Hai continue to improve while Yellow & Huai back on track; but only Yangtze meets the Water Ten target

Yangtze River – Grade I-III water quality improved from 84.5% in 2017 to 87.5% in 2018. Grade V+ water quality also improved from 3.5% to 2.2%.

Yellow River – Yellow has improved markedly across all categories this year since the dip in 2017. Grade I-III water quality materially improved from 57.7% to 64.4%. Grade V+ water quality also improved from 16.1% to 12.4%

Huai River – Grade I-III water quality improved drastically from 46.1% to 57.2%. Grade V+ water quality also significantly improved from 8.3% to 2.8%.

Hai River – Grade I-III water quality in Hai River improved materially from 41.7% to 46.3%. Grade V+ water also markedly improved from 32.9% to 20%. Hai River remains as the river with the least Grade I-III water.

Despite the improvements, Yellow, Huai and Hai rivers are still below the 70% target for Grade I-III water.

Pearl & Liao continue to worsen; Songhua’s water quality plunges

Pearl River – Grade I-III water quality deteriorated from 87.3% to 84.8%. Grade V+ water also slightly worsened from 4.2% to 5.5%, which is slightly higher than the 5 limit. Nonetheless, Pearl still reaches the Water Ten target of 70% water meeting Grade I-III.

Songhua River – Since the increase in 2017, Songhua water quality has plunged markedly across all categories this year. Grade I-III water quality deteriorated from 68.5% to 57.9%. Grade V+ water quality also worsened from 5.6% to 12.1%.

Liao River – Grade I-III water quality almost remained the same at 49%, but Grade V+ water worsened from 18.9% to 22.1%, which marked Liao River as the river with most Grade V+ water.


Further Readings

  • UAVs To Monitor Ship Emissions – Is it a bird? Is it a plane? No it’s a drone! Dr Zhi Ning from HKUST expands on their method to detect ship emissions & help check compliance
  • Beyond The Wall & Into The Watershed – Reducing your own factory’s water use is all well & good but what do you do when your basin is being impacted? Ecolab’s Ting He, Nestlé’s Qi Zhang & AWS’ Zhenzhen Xu provide examples on how to move into the watershed
  • Jiangsu Chemical Park Explosion: Rectify Or Shutdown? – The Jiangsu chemical plant explosion may have been deadly but the environmental & regulatory risks it’s bringing to light may be more worrying. China Water Risk’s Yuanchao Xu unpacks it for us
  • Your Inside Track To Rare Earths – Do China’s threats to weaponise rare earths in the trade war have any teeth? Even if not, a house of cards worth trillions could be at stake – find out why & get the edge now
  • Eco-preneurs To Combat Pollution – What are “eco-preneurs”? The Ministry of Ecology & Environment’s Dr Zhanfeng Dong explains & elaborates on their role as a lynchpin in winning China’s war on pollution

Regulations

  • Two Sessions: Reform – Transform – It has been a tough year but President Xi is staying true to his resolution to build a Beautiful China – what transformations can we expect? Find out in our review of this year’s Two Sessions
  • Key Water Policies 2018-2019 – Haven’t been following China’s environment & water-related policies? Get on top of them now with China Water Risk’s review, including China’s first Soil Ten Law & renewable energy quotas
  • Ministry Reform: 9 Dragons To 2 – What does China’s long-awaited ministry re-shuffle mean – who manages what and how? China Water Risk’s Woody Chan and Yuanchao Xu review the roles and impacts of the new Ministry of Ecological Environment & Ministry of Natural Resources
  • 5 Laws To Watch Out For In 2018 – From environmental taxes to compensation mechanisms to nuclear safety, China is continuing its regulatory push in the new year. China Water Risk’s Yuanchao Xu reviews 5 key laws to watch out for in 2018

River Basins

  • Audit! Yangtze River Economic Belt – China’s first ever basin-wide environmental audit on the Yangtze River Economic Belt is an unprecedented step towards balancing economy & environment. China Water Risk’s Woody Chan shares the good and not so good findings
  • Yangtze Flows: Pollution & Heavy Metals – Areas along the Yangtze River dominate Chinese production but at what cost? With Grade V water in its tributaries, rapid growth in upstream wastewater plus concerns over a disproportionately large share of the nation’s heavy metals discharge, can the Yangtze River Economic Belt still flourish? CWR’s Hu takes a closer look
  • Water-nomics: Trade-offs Along The Yangtze – With significant economic, water use and pollution disparities along the Yangtze River, China Water Risk & the Foreign Economic Cooperation Office of the Ministry of Environmental Protection, publish a joint brief to explore strategies to find the right development mix. Check out some of the key findings in this review
  • Pearl River Delta: 5 Water Must-Knows – China’s Pearl River Delta generates 9% of GDP but water challenges lurk behind the dazzling economic success. Don’t know what these are? China Water Risk’s Feng Hu shares 5 water must-knows for the region

Past State of Environment Reviews

  • 2017 State Of Ecology & Environment Report Review – Prioritising rivers appears to have paid off but overall groundwater and Key Lakes & Reservoirs both worsened. Are we now seeing the “real” state of China’s environment? Find out in China Water Risk’s review of the 2017 State Of Ecology & Environment Report
  • 2016 State of Environment Report Review – The signs are positive for China’s environment in 2016. Groundwater quality improved after 5 years of decline though there is mixed news for rivers & lakes. Is the tide turning in China’s ‘war on pollution’?
  • 2015 State of Environment Report Review – China says overall environment quality has worsened in 2015 with groundwater deteriorating for the fifth year straight. It’s mixed news for rivers but lakes & reservoirs see marked improvement. Get the latest pollution status updates from the newly released 2015 State Of Environment Report

China Water Risk
Author: China Water Risk
We believe regardless of whether we care for the environment that water risks affect us all – as investors, businesses and individuals. Water risks are fundamental to future decision making and growth patterns in global economies. Water scarcity has emerged as a critical sustainability issue for China's economy and since water powers the economy, we aim to highlight these risks inherent in each sector. In addition, we write about current trends in the global water industry, analyze changes occurring both regionally and globally, as well as providing explanations on the new technologies that are revolutionizing this industry.
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